Buying your first home today can be a challenge, with higher interest rates, higher qualification criteria, increased home prices. All of it adds up. However, rents are increasing, it’s getting harder to find good homes or apartments to rent, and you’re not creating equity with each rent payment you give the landlord. Fortunately, there are a number of programs and incentives offered by the federal,
1. Home Buyer’s Plan
Withdrawals from your RRSP are generally taxable income, with the Government Home Buyer’s Plan, you can withdrawal
“The Home Buyer’s Plan (HBP) is a program that allows you to withdraw up to $25,000 ($50,000 per couple) in a calendar year from your registered retirement savings plans (RRSPs) to buy or build a qualifying home for yourself or for a related person with a disability,” says Olga Coulter, Senior Account Manager at the Canada Mortgage and Housing Corporation (CMHC). “To be eligible, you must be a first-time homebuyer (ie. you haven’t purchased a home or lived in a spouse’s home within the last four years) and have a written agreement to buy or build a qualifying home for yourself or for a related person with a disability.”
Note that these funds must have been in your account for at least 90 days before the purchase of your home and they do have to be paid back within a 15-year timeframe. “Essentially, you are ‘borrowing’ these funds from your RRSP as they need to be repaid over a 15-year period beginning the second calendar year after the withdrawal,” adds Therriault.
2. First-Time Home Buyers’ Tax Credit
The First-Time Home Buyers’ (FTHB) Tax Credit helps to make purchasing a home more affordable by allowing Canadians to claim a portion of their home purchase on their personal tax return that same year. This helps to offset expenses like legal fees, home inspections
“The FTHB Tax Credit offers a $5,000 non-refundable income tax credit amount on a qualifying home acquired after January 27, 2009,” says Coulter. “For an eligible individual, the credit will provide up to $750 in federal tax relief.”
To be eligible, you, your spouse or common-law partner must have acquired a qualifying home (a unit located in Canada purchased after January 27, 2009) and cannot have lived in another home you or your partner owned in the year of acquisition or in any of the four preceding years.
3. GST/HST New Housing Rebate
If you are purchasing a new construction home, performing substantial renovations to an existing home, or rebuilding a home that was destroyed by fire, you can apply for the GST/HST New Housing Rebate. Filling in this form can save you thousands of dollars, as it recovers a portion of the goods and services tax (GST) or the federal part of the harmonized sales tax (HST) if all eligibility conditions are met.
“You may qualify for a rebate of part of the GST or HST that you paid on the purchase price or cost of building your new house, or on converting a non-residential property into a house,” explains Coulter. “You may also be eligible if you are doing substantial renovations or have hired someone to complete substantial renovations to an existing home, such as an addition.”
4. CHMC Green Home
If you buy, build, or renovate for energy efficiency using CMHC-insured financing, you could receive a 15% rebate for building a home to ENERGY STAR® standards or up to 25% for building a home to R-2000 building standards.
5. Genworth Canada Energy Efficient Housing Program
Receive a 25% rebate when you build a home through one of Genworth Canada’s qualifying energy-efficient building programs or meet the prescribed minimum Natural Resources Canada EnerGuide requirements and fund it through a Genworth Canada insured mortgage.
6. Ontario Land Transfer Tax Refund for First Time Home Buyers
Under this program, if you’ve never owned a home anywhere before—ever—you could qualify to receive a refund of the land transfer tax for the first $368,000 of the value of the home. The maximum amount of the refund is $4,000.
The biggest hurdle in qualifying for the maximum amount of this program is that all purchasers of the home must be first-time homebuyers. If one or more purchasers
7. ONTARIO ENERGY AND PROPERTY TAX CREDIT
Non-seniors can receive up to $1,043 while seniors can receive up to $1,187. Even students can receive a credit of $25 if any of their costs were related to energy costs, and if you live on a reserve or in a public long-term care home, you can receive up to $232.
8. County Specific Affordable Home Ownership Programs.
Each year Hastings and Prince Edward Counties introduce an Affordable Home Ownership Program that helps provide the down payment on your first home purchase. The programs generally do not get taken advantage of, meaning there’s a good chance you may be able to get money for your down payment. There are a few qualifications required that change from year to year and from county to county, so it’s best to talk you us or the county directly to see what the rules are each year. Generally, the money does not need to be