If you can save a little money here and there it will be worth it. Provincial and federal governments offer homeownership programs, as well as some municipalities.
There are three types of government assistance:
• Tax incentives (e.g. HBP, tax credit);
• Financial assistance to reduce the purchase price;
• Home or mortgage insurance premium reduction;
Home Buyers’ Plan (HBP)
For several years, the federal government has been facilitating home ownership through the HBP. This plan allows each taxpayer to withdraw up to $25,000 from their retirement savings plan (RRSP) to acquire a first home. This plan is subject to a repayment obligation. He/she has 15 years to reinject all the funds back in the RRSP’s. Click here for more info on Home Buyer’s Plan.
First-Time Home Buyers’ Tax Credit (HBTC)
The amount for a qualifying residential unit is $5,000. The credit is applicable to many types of housing. A share in a housing co-op is also eligible if it gives you the right to own housing in Canada. A person with a disability who is eligible for the disability tax credit may also have access to the FITC. Click here for more info on First-Time Home Buyer’s Tax Credit.
The owner of a Novoclimat 2.0 certified home receives $1,000 in financial assistance from the Minister of Energy and Natural Resources (MERN) if the project were to be registered before October 2016. It’s even more advantageous for home buyers whose project is registered after October 4th, 2016. If you are the first owner, the assistance is $4,000. The owner will also benefit from a 15% discount on his home insurance premium. Finally, discounts on mortgage rates are offered by some financial institutions. These energy efficient homes also save 25% on heating costs. Click here for more info on Novoclimat.
A person who acquires an energy efficient unit will receive a refund of 15% or 25% of the mortgage loan insurance premium, a program administered by CMHC. The 15% premium refund applies to homes built to Novoclimat, LEED Canada, Energy Star and Built Green Canada standards. The 25% rebate applies to houses built to the R-2000 standard. Energy efficient homes not built to either of these two standards may also be eligible but must be assessed in advance by a certified energy advisor. Click here for Green Home information.
Provincial Tax Credit
In the 2018 budget, the Quebec government offers a tax credit of up to $750 for the purchase of a first property. Combined with the measure offered by the federal government of $626, it will allow new homeowners to benefit from a credit of up to $1376. A person who has not owned a home for four years may also benefit from the credit. Click here for more Provincial tax credit info.
Programs managed by municipalities:
Most major cities in Quebec (Montreal, Quebec City, Laval) and some other smaller cities have homeownership programs. Some of these programs are designed to attract families.They come in various forms:
• Purchase credit;
• Interest-free loans;
• Remittance of real estate transfer taxes;
• Property tax credits.
Programs in Montreal
This program came into effect on June 1st, 2018 as an incentive to encourage families to settle in the city centre. It covers both new and existing properties. The eligible value increases from $360,000 to $450,000 and financial assistance increases from $8,900 to $15,000 for the purchase of a downtown property for a couple with children. As for acquiring a property outside downtown, the maximum value of the property is $400,000 and the assistance is $10,000.
The program also provides aid to childless couples and single persons. For the former, the maximum value of the property is set at $280,000 and the assistance at $5,000. For single persons, the assistance is also $5,000 and the purchase value is set at $225,000. Click here for more info on Programs in Montreal.
This program offers a purchase credit for Accès Condos accredited projects, amounting to 10% of the sale price of a divided co-ownership. Click here for more info on Accès Condo.
Grant for seniors to offset a municipal tax increase
This grant aims to offset a municipal tax increase brought about by a significant increase in the value of your residence. You must be 65 years or older to be eligible. To obtain more information on eligibility, click here.
For more information, contact me.
This article is inspired by the Guide d’Habitation