How A Consultant Bought Her $1.4M Etobicoke, ON Townhome

Welcome to How I Bought It, where, each month, one Canadian shares how exactly they managed to buy their home. Our goal is to demystify the path to home ownership by talking openly about the challenges — and often the privileges — in getting there.

Location: Etobicoke, ON
The home: 3+1 bedrooms, 3 bathroom semi-detached townhouse that was built in the 1920s but was completely renovated in 2020. This included digging out the basement to raise the ceiling and tearing down walls on the main floor to make it open concept.
When I bought: Spring 2021
What I spent: $1.465 million
Downpayment: $385,000 (Split 50/50 with my partner)
Monthly mortgage payment: $3,800 (We pay $1,900 semi-monthly)
Property Taxes: $4,700/year
Land transfer and lawyer fees: $50,000

How I bought it: I started working at the age of 12. I've always been driven to save; growing up, my family wasn’t very financially fortunate. I lived in a small town, so money did go a lot further than if I’d grown up in a big city like Toronto, but my parents didn’t make a lot of money. I think I just wanted to be the opposite. I wanted to be able to have whatever I wanted rather than be told no or have to choose between things because I couldn’t afford them. My parents also got divorced, so seeing that I was like, Oh I need to earn my own money, you can’t rely on someone else. I also have expensive taste; I wanted a nice home and wanted to live nicely.

I have a bit of a saver’s mentality; for example, I got a cool set of watercolour paints when I was growing up, and I still have them today because I wanted to save them for the right time. It’s a very absurd thing, but it’s me! Between 12 and 15, I babysat (a lot!), and from 15 until I was 18, I worked part-time as a grocery store cashier. While attending university, I worked part-time doing marketing for my school, and full-time at a daycare or accounting firm in the summers. (While I paid for my tuition and most living expenses, my mom let me charge my groceries to our joint credit card while I was at university, an offer I took her up on about half the time. She would then pay that bill. All other expenses I paid through my savings which were bolstered by OSAP.) I’ve also been working full-time as a consultant in Toronto since I was 22. 

Once I moved to Toronto in 2015, I realized how important it would be to continue saving money to eventually buy a condo or a home. I paid off my OSAP student loans (around $41,000 for four years; because my parents were divorced, OSAP forgave around $4,000) immediately after graduating as I'd accumulated decent savings from working in my teens. I paid it off in five and a half months so I wouldn’t have any interest. While living and working in Toronto, I paid my rent — I had one roommate — and enjoyed life but continued to grow my savings. 

I didn’t have any specific saving plan (like putting a certain amount of my paycheque into savings each month). I used the Mint app for a while, but mostly I just always made sure I was “in the green.” I made sure to always get my expenses out of the way and live within my means, and to know I had money in advance of any expenses. For example, OSAP comes in a couple of days after your tuition is due. If you can’t pay your tuition, sometimes you’re charged $200 to cover the two days until your OSAP comes in (this is a terrible way universities punish underprivileged people); so I made sure I always had enough money saved to pay my tuition on deadline and not incur any additional fees. When I could go on a vacation (I’ve been on two or three since moving to Toronto), they were done budget-friendly, staying at hostels.

My boyfriend really started saving after university as he earned an above-average salary and lived well within his means by having a roommate and using his condo gym to save money, for example. We started dating in early 2018 and enjoyed eating at restaurants around once per week but tried to cook at home for most dinners and bring prepped lunches to work. My mom gave me $25,000 when I turned 25, which is something she did for my older siblings, so I invested it and used it towards the downpayment. My partner and I both cashed in $10,000 of our RRSPs. Aside from this, we managed to save enough for the downpayment by living frugally, and not having a car while living in Toronto. I had a head start on saving because I had saved quite a bit through my babysitting, grocery store, and university employment. 

Why I bought it: I grew up in small-town Ontario where house prices tend to range from $250,000 to $450,000, so home ownership is possible for many of its residents. It tends to signal a sense of accomplishment and adulthood to me. While renting in Toronto, it felt terribly temporary, so I never fully settled in. Once my boyfriend and I moved into a rental together in April 2020 (a one-bedroom, one bathroom loft for $2,650), we discussed our mutual goal of buying a house, so we started saving more aggressively. Then, with the pandemic, we felt the need for more space and a yard. The pandemic also lowered interest rates, so we knew we could score a good rate on a mortgage if we bought sooner rather than later. We started working with a realtor in April and found a house two weeks later so we were able to leverage our pre-qualification rate from the bank.

As for why we chose this specific house, it checked almost all of our boxes. We were looking at two areas in Toronto — North Toronto or Mimico. We'd been watching the market for a while, but only viewed six to eight homes before making an offer on our eventual home (we also made an offer on one other home, but it wasn’t serious, more to get used to the process). This home had three bathrooms (including a bathroom on the main floor) and was located less than a five-minute walk from his family. It had been fully renovated, so it was move-in-ready, which we preferred, and is near enough to transit for us to commute to our jobs downtown once they open back up post-pandemic. The kitchen was the thing we prioritized. We wanted it to be open concept because my partner cooks quite a bit and I like to bake.

How the deal went down: Browsing the housing market is incredibly fun but, once you're in it, it's far more stressful than I could have imagined. Every home we looked at had a future date set (usually four to seven days after the listing went live) for when the sellers would accept offers. However, we viewed a couple of homes where the sellers received bully offers, which they would accept, and we wouldn't have an opportunity to put in a bid. We saw this happen to the two homes we liked prior to the one we bought, so we decided that, since we liked the property so much, we would put in a bully offer. The house had an available home inspection report, which gave us some comfort in submitting an offer without conditions (because conditions on an offer in this crazy market will almost certainly not win you the bid).

Along with our offer, I wrote a letter to the sellers about the reasons why we felt the house was perfect, and why we were the perfect buyers (and because I’m a consultant, I made a PowerPoint). The sellers’ realtor wanted to allow for some competition, so they gave other interested parties around 30 hours to submit their offers — enough time to secure nine additional offers. On the night of the offer acceptance, we were told that we were in the "top echelon," and asked if we could increase our bid to what we felt was our maximum offer. This part of the process is frustrating because we could've been bidding against ourselves, for all we know.

We also weren't sure about spending that much on a home that wasn't detached. We took five minutes and decided that we could raise our offer by $40,000 because we were quite invested in this home and felt that our final offer price was reasonable for what we were getting (our budget was $1.5 million and our first offer was $1,425,000). After calling our realtor to tell him our final offer, he did his magic. An anxious hour passed, and we received a call from our realtor telling us we got the it!

What I wish I’d known before I bought: Our biggest learning lesson pertains to the home appraisal step that is done by the bank to arrange for the value of the mortgage. Because we bought in an established neighbourhood with few comparables (similar homes that have recently sold), it made it difficult for the home appraiser to determine the value of the house. Typically, buyers will have 20% of the purchase price saved for the downpayment and the bank will provide the other 80% in a mortgage. But for us, the value they appraised our house at came in lower than our purchase price, which means the bank will only offer 80% of the appraised amount — not 80% of our purchase price.

Thankfully, we had enough savings that we could cover the difference, so we ended up putting more than 20% as a downpayment and we have a smaller mortgage (which isn't so bad, right?). It means we had less cash to spend to furnish our house but, with our mortgage amount being smaller, our payments are less, so we'll have more cash flow each month and we'll save on interest in the long run.

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