For most young Canadians, purchasing their first home can be very overwhelming and financially intimidating. Knowing that you are bound to mortgage payments to the bank for the next 25 or 30 years seems out of reach for most individuals in their mid-twenties and/or early thirties.
Depending on where you live in Canada, you may be able to get subsidized by all three levels of Government (Federal, Provincial and municipal).
The Federal Government offers some tax incentives to first time homebuyers:
- As of January 27, 2009, the Federal Government instituted the First Time Home Buyer’s Tax Credit of $5,000. At the lowest tax rate of 15%, you will receive back $750 in taxes. http://www.cra-arc.gc.ca/gncy/bdgt/2009/fqhbtc-eng.html
- The Home Buyer’s Plan allows first time home buyer’s to withdraw up to $25,000 from their RRSP. You will have up to 15 years to repay the money back to your RRSP. http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/rrsp-reer/hbp-rap/menu-eng.html
- If you’re up to the task of buying a fixer upper, there is the ecoENERGY retrofit grant where you can receive up to $5,000 to offset the cost of making energy efficient improvements. http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/rrsp-reer/hbp-rap/menu-eng.html
Provincial incentives:
- Similar to the ecoENERGY Federal retrofit grant, the province of Quebec and Ontario offers their own similar programs. They are essentially the same program and you will receive a grant from both programs at the same time! Quebec – http://www.aee.gouv.qc.ca/en/my-home/renoclimat/ Ontario – http://www.mei.gov.on.ca/en/energy/conservation/homeenergyon/?page=homeenergy-retrofit
- For a full list of Provincial programs consult this link: http://www.oee.nrcan.gc.ca/residential/personal/retrofit-homes/provincial-municipal.cfm?attr=4
Municipal incentives
- If you live in Montreal and are looking to buy your first home, then you’re in luck! There was a first time home buyer subsidy of a minimum $6,000. The subsidy will increase if you have one or more children. Unfortunately this subsidy expired December 31, 2009 but the good news is that a new program will be announced in early March! http://ville.montreal.qc.ca/portal/page?,16347780&_dad=portal&_schema=PORTAL
- For other municipalities, please check with your local city hall to see if they offer similar rebate programs.
