Get a Jumpstart on Homeownership with Canada's

First Time Home Buyer Incentive!

The Government of Canada (GOC) has unlocked the Door to Homeownership for First Time Home Buyers (FTHB).

Yes! you heard it right.

The government of Canada is supporting the first time homebuyers by sharing their burden. Two most important challenges faced by FTHB are:

• Save a huge amount of money to pay the downpayment. This barrier can actually delay your dream of having a home. 
• Paying the bare minimum amount as down payment will result in significant increase in your mortgage amount.

These hurdles can be crossed with the incentive provided to FTHB.

What is the First Time Home Buyer Incentive (FTHBI)?

The First-Time Home Buyer Incentive is a shared equity mortgage (SEM) program that extends a helping hand to individuals across Canada who aspire to own their first home. Under this initiative, eligible home buyers receive a 5% or 10% contribution towards the property's purchase price, which can be used towards the down payment. 

By reducing the financial burden of the down payment, this program makes the overall cost of homeownership more reasonable by lowering mortgage carrying costs.

The FTHBI Program was first launched in September 2019. The government's efforts to aid Canadians in buying their first home have been extended with the announcement in Budget 2022 that the First-Time Home Buyer Incentive will be available until March 31, 2025. (Isn't that great?)

Evaluate your Eligibility

To qualify for it you must be a Canadian citizen, permanent resident or a non-permanent resident who is legally authorized to work in Canada. 

Eligibility for the First-Time Home Buyer Incentive is determined based on the following criteria:

• The applicant has not previously purchased a home.
• The applicant has experienced a breakdown of marriage or common-law partnership, regardless of whether they meet the other requirements for first-time home buyers.
• The applicant has not lived in a property owned by themselves, their current spouse, or common-law partner within the past four years.

Income Requirement:

• The maximum total qualifying income  is $150,000 per annum for Toronto, Vancouver and Victoria Census Metropolitan Areas (CMAs).
• The maximum total qualifying income is $120,000 per annum, for all other housing markets.

*It is advised to hire a mortgage specialist for calculating your eligibility.

Repayment of the First-Time Home Buyer Incentive

• When it is to be repaid?

The First-Time Home Buyer Incentive must be repaid either when the home is sold or after 25 years, whichever occurs first. There is no penalty on prepayment.

• How to calculate the repayment amount?

Case 1: where the home’s value has appreciated, the Incentive plus a maximum gain of 8% per annum (not compounded) on the Incentive amount from the date of advance to the time of repayment; or

Case 2:  where the home’s value has depreciated, the Incentive minus a maximum loss of 8% per annum (not compounded) on the Incentive amount from the date of advance to the time of repayment. 

*Additional conditions may apply. The information is subject to change at any time. For more details please refer to the source below.

Source: First time home buyer incentive by GOC