Student Loan & Real Estate… “Should I Buy or Rent?”

Written by Posted On Wednesday, 31 August 2016 13:18
Student Loan & Real Estate Student Loan & Real Estate

A lot of millennials are just finishing up college and wondering if they should dive into the housing market. Are you in this same situation? It might be stressful trying to figure out what you should do, especially if you have student debt that's built up from your education. It's important to know that you're certainly not alone, as a lot of recent graduates are in the very same situation. They want to invest so they can stop paying rent but aren't sure if now is the time. If you need some perspective to make sure that you are ready for homeownership, take a look at Jack and Johanna's story initially shared by The Globe and Mail.

Investing After Graduating

After graduating college Jack and Johanna had $45,000 in student loans along with a $19,500 car loan. Naturally, they were thinking about purchasing a home, especially since their household income totalled around $140,000. But before they started to look at places to call home, they decided to do some research on home buying tips and asked an expert if this was a financial move they'd end up regretting. That expert was Christine White, who is a money coach in Toronto who helps people maximize their investments and make smart financial decisions.

White determined that renting was going to be the best choice until the couple had their student debt paid off. And in order to pay that off, she recommended they put in a combined $1,600 per month towards re-payment. Under this plan, they'd have their loans paid off in 2.5 years and would avoid paying thousands of dollars in interest as well. Are you thinking about doing the same thing? See the same benefits by paying off the highest interest loan first.

The next piece of top-notch real estate advice from White was for the couple to take $50 from every paycheck and put it in a retirement savings plan. If each did this, then they will be able to withdraw it in the future under the government's Home Buyers' Plan. This can be used towards a down payment, and both Johanna and Jack could retrieve $25,000 each, meaning a total of $50,000! And once the couple is ready to pull that money out and buy a home, they'll want to make sure they have at least 20% down so they can avoid mortgage loan insurance, which will only cost them more money. In order to make sure they have spare cash to cover that down payment, they should save the $1,600 per month they were paying towards their loan for a year or two.

Looking at Your Situation

If you're in a situation where you have student debt, take it from an expert and pay it off before you head out to buy a home in Calgary. This will free up a lot of your money so you can save more and do more once you actually have the keys to your home. This might take you a little longer to achieve, but it will be worth it in the long run, especially with the money you save on student loan interest.

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Joe Samson

I have lived in Calgary, AB since 1991 and have started working in real estate in 2005. Up to date, I have helped hundreds of satisfied buyers and sellers to successfully complete their real estate transactions. 

Initially, I have fallen in love with real estate even before I’d ever thought about becoming a real estate agent. My early years were fulfilled with buying and selling revenue producing properties. As the years passed, I have become more attached to dealing with real estate and as people got to know me and a little more of what I have done, I have naturally transitioned into helping others to build a path to their financial success by investing in real estate. And the rest has become the story of my life…

This may shock you, but my main focus isn’t on selling real estate. I mostly put my attention toward online marketing which ultimately helps my sellers to find a buyer for their property and to get the maximum possible sale price. 

In the 21st century, marketing is immensely different then what it used to be 10 years ago. I find it imperative to stay ahead of the competition and figuring out what works and doesn’t is the backbone of my business and it allows me to generate the best results for my clients. 

I also love providing help to my buyer clients by offering them a state of the art website and access to all homes for sale in Calgary, AB. 

I also believe that by answering my client's question in advance helps me to provide the best experience and I intend to achieve that by keeping my Calgary real estate blog up to date on a regular basis.

I service the greater Calgary area and its surrounding suburb communities. Some of the most popular communities in South Calgary that I service are Evergreen, Silverado, Chaparral, and Cranston. West Calgary and City Centre Calgary also contributes a great deal to my business area. Other parts of the city such as Southeast Calgary where many new homes are being built have also become a great joy to work in while helping clients finding their new homes. 

One of the principal foundations of my business model is that I’ll always tell you what you need to hear versus what you want to hear. Your interest is guaranteed to be more important to me than anything else. Integrity is the lifeline of my daily interactions with others and our mission is to “honour our clients with our world and do what we say we are going to do... when we say we are going to do it.”

If you’re thinking of buying or selling a home in the Calgary area, please reach out to me anytime and I’d love to help you to navigate you through your home buying journey.

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