As a millennial, a first-time buyer or a newcomer to Canada, it may seem like it is impossible to get into the real estate market right now; prices are skyrocketing in the city and there aren’t enough houses to go around. But all hope is not lost as the Government of Canada offers a number of financial incentives to help you throughout the home buying journey. While that doesn’t help with housing inventory, it might inspire you to kick-start your buying process. You’re closer to homeownership than you think!
Find out which incentives might be right for you.
The First-Time Home Buyers’ Incentive helps people across Canada purchase their first home. The program offers 5 or 10% of the home’s purchase price to put toward a down payment. This addition to your down payment lowers your mortgage carrying costs, making homeownership more affordable.
When you buy land or an interest in land in Ontario, you pay land transfer tax. First-time home buyers of an eligible home may qualify for a refund of all or part of the tax. Eligible first-time home buyers can receive first-time buyer tax returns in Toronto, which include a maximum land transfer tax rebate amount of $4,475 on their Municipal Land Transfer Tax and up to $4,000 on their Provincial Land Transfer Tax, for a total rebate of $8,475.
The First Time Home Buyers’ Tax Credit is a non-refundable tax credit that helps homeowners recover closing costs such as legal expenses and inspections. First-time buyers can claim up to $5,000 for the purchase of a qualifying home on their personal tax return on the year of purchase. You could net up to $750! However, you cannot have lived in another home owned by you or your partner in the previous four years.
If you have a disability (i.e., you are eligible for the disability tax credit) or if you bought the house to improve accessibility for someone who is disabled, you do not have to be a first-time home buyer.
The Home Buyers’ Plan (HBP) is a program that allows you to withdraw up to $35,000 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.
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 home, on the cost of substantially renovating or building a major addition onto your existing home, or on the cost of converting a non-residential property into a home. GST/HST New Housing Rebate provides all of the details on this rebate.
The Canada Greener Homes Grants are helping Canadian homeowners across the country improve the energy efficiency of their homes and reduce their energy bills. Eligible homeowners will be able to receive grants to make energy-efficient retrofits to their homes. Go to Natural Resources Canada to get more details.
Have questions about any of these rebates or incentives? Contact us today!