Unlocking Homeownership With The New First-Time Home Buyer Incentive

Canada's new First Time Home Buyer Incentive is designed to financially assist first-time home buyers without adding additional financial burdens, and is already helping thousands of Canadians purchase their first home. There are no additional monthly payments, which reduces the carrying costs associated with home ownership.

Through this incentive, the Canadian government provides 5% to 10% of a first-time buyer's purchase of a newly constructed home, or 5% for a purchase of a resale home or mobile home. The financial aid provided is to be used towards the down payment for the home. The incentive must be paid back to the government in full after 25 years or when the home is sold.

The program works as a shared equity instrument. If the home appreciates in value over time, participants would owe the government the full incentive amount plus a maximum gain of 8% per annum on the incentive amount. If the home depreciates in value, participants would owe the government the full incentive amount minus a maximum loss of 8% per annum on the incentive amount.

To be eligible, participants must meet the following criteria:

• Total annual income less than $120,000 (or $150,000 if purchasing in Metro Toronto)
• The total borrowing amount is no more than 4 times your annual income (or 4.5 times if purchasing in Metro Toronto)
• Must be a Canadian Citizen, permanent resident, or non-permanent resident authorized to work in Canada
• Must meet minimum down payment requirements without borrowed funds
• The mortgage must be greater than 80% of the property's value and is subject to mortgage loan insurance
• Only applies to residential properties with up to 4 units
• The participant must live in the property as their primary residence

If you want to learn more about this incentive, reach out to me. As a first-time home buyer, it is essential to have the right guidance by your side.