A condominium under construction in Langford offers an alternative to the traditional home buying model that may prove an attractive option as home prices and rents continue to rise beyond the reach of many people in Greater Victoria.
Studio, one-bedroom and two-bedroom apartments at Centennial Court on Carlow Road are expected to go on sale in the near future, with move-in expected over the winter. Prospective residents will have the option of enrolling in EP Homes’ Bridge to Homeownership program as an alternative to purchasing a unit with cash or with a traditional mortgage.
“What EP does…is they really help educate people and guide them financially so they can create savings,” said Tony Zarsadias, co-owner of Island Realm Real Estate. “There’s a typical security deposit like you would have in any rental, and then there are two components to your monthly payments: the first is rent, which is set by a third-party appraiser…and the second component is the savings component, which will effectively save that person the 5% they need to qualify for a mortgage, over three years.
Once the down payment has been saved, Zarsadias said the tenant is then able to purchase the unit from EP Homes at “market rate” through a conventional mortgage, which EP Homes will help the tenant to ask.
Zarsadias, whose company Iron Clad Developments has partnered to sell units in the building, said the program’s goal was to enable people who could afford monthly mortgage or rent payments, but not l down payment required to secure a mortgage, an opportunity for easier access to home ownership.
Paul Schure, a professor in UVic’s economics department, said there is a clear societal need to make homeownership more accessible, and for some buyers the program offered by EP Homes could be very attractive.
“Homeownership isn’t impossible, but it’s become much more difficult than it was 25 years ago,” Schure said. “I see a need and I see a potential market for what EP Homes offers.”
But he notes that there are some important caveats to keep in mind, and it may be possible to get a better deal by going through parts of the EP Homes deal through traditional channels.
For example, it may be possible for potential homeowners to simply save themselves for a mortgage down payment, and if they are careful about how they invest their savings, they may be able to take out more than the minimum needed for a deposit. . And while the convenience of having all the elements of the deal with one company is certainly appealing to many, Schure is generally cautious about putting too many eggs in one basket when it comes to a company’s finances. nobody.
Despite precautions, he sees such alternative routes to homeownership growing and becoming more common, though he doubts they will become mainstream anytime soon.
“Providing a viable pathway to home ownership is a very significant societal issue that is not being adequately addressed in Greater Victoria and the broader North American context,” Schure said. “I think some of the solutions will have to come from the government, but it’s difficult because you don’t want these interventions to become so drastic.”
An example of government intervention is on display on the West Bank in the form of the Town of Langford’s Accessible Housing Program, which sees the town contribute to the down payments of eligible first-time home buyers.
As of Oct. 20, the city told Black Press Media that more than 800 people have expressed interest in the program, which is still in its early stages, with 12 having formally applied with all required documents, five having been accepted into it and one. has already purchased a condo.
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