Buying your first home is a significant milestone! While you’re thinking about your affordability and what type of home you want to own, we have some exciting updates around first-time homebuyer benefits:
New or Pre-Construction Homes: Did you know? First-time buyers looking to purchase a new build or pre-construction home are eligible for 30-year amortization. This mortgage commitment can allow you to have smaller monthly payments, versus a standard 25-year amortization.
Mortgage Default Insurance: The CMHC has recently made it so mortgage default insurance will cover up to $1.5 million homes (increased from $1 million), helping more Canadians qualify for insured mortgages.
The Home Buyers’ Plan (HBP): The Canadian government has a program known as the Home Buyers’ Plan (HBP), which is designed to allow first-time homeowners to withdraw up to $60,000 from RRSP to buy a home!
Purchasing with your spouse? You can access a total of $120,000 from your RRSP’s.
First Home Savings Account (FHSA): The First Home Savings Account (FHSA) is specifically designed to help first-time homebuyers save for their down payment without paying taxes on the interest earned on their savings. The maximum is $8,000 annually that you can add into this account to save, with a maximum of $40,000 lifetime contributions.
First-Time Buyer Exemption: First-time home buyers are eligible for an exemption, reducing the property transfer tax you pay. If the fair market value of the property is:
- $500,000 or less, you can claim an exemption amount equal to the full amount of property transfer tax.
- Over $500,000 but no more than $835,000, the exemption amount is $8,000.
- Over $835,000 and under $860,000 then the exemption amount is proportionally reduced up to $15,200.
Land Transfer Tax Rebates: First-time buyers in Ontario, British Columbia, Prince Edward Island, and the City of Toronto are able to claim land transfer tax rebates.
