What do first-time buyers need to know? As an award-winning Vancouver realtor, I have helped many new homebuyers enter the market. Obviously, it’s a steep challenge for anyone today, but the good news is that there are many excellent grant and assistance programs at both the federal and provincial levels. Here are a few I recommend to my first-time buyers.
Home Buyers’ Plan
Through the Home Buyers’ Plan, first-time buyers can take up to $60,000 out of an eligible registered retirement savings plan, or RRSP, and put it toward the down payment of a primary residence. Funds must be repaid in 15 years without penalty. Qualifications include:
- Being a first-time buyer.
- Being a Canadian resident from when you withdraw the funds until your home is bought/built.
- Intending to use the home as a principal residence.
First Home Savings Account
If you’re still saving for a downpayment, the FHSA (First Home Savings Account) is a wonderful investment tool. Buyers can contribute up to $8,000 per year to an FHSA, up to a maximum of $40,000. Contributions are tax-deductible, and the investments generated are tax-free. Invest in GICs, stocks, and bonds to grow savings faster!
First-Time Home Buyers’ Tax Credit
Even after you close on a home, there are still costs. With the First Time Buyers’ Tax Credit, buyers may qualify for a non-refundable credit of $10,000, resulting in a tax rebate of up to $1,500,
GST/HST New Housing Rebate
For those buying or building a new home, the New Housing Rebate can help recoup some of the Goods and Services Tax (GST) or the federal portion of the Harmonized Sales Tax (HST).
B.C. Based Programs
For BC residents, the province offers some excellent initiatives to first-time home buyers, which can add to considerable savings.
B.C. First-Time Home Buyers’ Program
To help with those expensive closing costs, the B.C. First-Time Home Buyers’ Program, reduces/eliminates land transfer tax on a home worth up to $835,000, saving buyers up to $8000. Qualifications include:
- Being a permanent Canadian resident or citizen.
- Living in B.C. for the last 12 months or filing at least two income tax returns in the previous six taxation years.
- Never previously owning a property considered your principal residence.
- No previous receipt of the B.C. first-time home buyers’ tax break.
B.C. Home Owner Grant
Another tax-focused incentive, the Home Owner Grant, offers eligible homeowners, first-time and seasoned, an annual reduction of up to $770 in property taxes. Homes valued above $2,239,000 are ineligible. Criteria include:
- Living in B.C.
- Being a Canadian citizen or permanent resident.
- Being either the registered owner of the home or the spouse or relative of its deceased owner.
- Using the property as a principal residence.
Newly Built Homes Exemption
The Newly Built Home Exemption can ease the property tax on new builds and preconstruction properties worth up to $1.1 million, making it an attractive incentive for anyone considering one of Vancouver’s many up-and-coming developments or even those building their own home.
Connect with Ariane Benjamin
Getting into Vancouver’s housing market can be a challenge. As a seasoned Vancouver realtor, I advise and advocate for home buyers and sellers, providing guidance and tips to make journeys smoother and more successful.
Let’s have a complimentary consultation to discuss the different types of homes available. Call 604-779-1500 to get started.