The First-Time Home Buyer Incentive is a program in Canada that assists first-time homebuyers in purchasing their first homes. It provides an additional 5% or 10% of the home’s purchase price to put towards the down payment. This reduces mortgage costs, making homeownership more affordable.

Recent updates to the program have expanded eligibility for those buying homes in certain areas and introduced limits on the government’s share in the home’s appreciation or depreciation.

This incentive acts like a second mortgage on your home, and it’s available for various types of residential properties, including single-family homes, townhouses, and condominium units, as long as the property is in Canada and intended for full-time occupancy.

Eligibility

To be eligible, your annual income must not exceed $120,000 (or $150,000 in specific cities), and your total borrowing should be no more than 4 times your qualifying income (or 4.5 times in specific cities). You must also meet the criteria of being a first-time homebuyer and a Canadian citizen, permanent resident, or authorized non-permanent resident.

Repayment of the incentive is required after 25 years or when the home is sold. Certain circumstances, such as buying out a co-borrower or porting your mortgage, can trigger repayment.

To apply for the incentive, you need to complete specific application forms provided by the program. Additional costs, like legal fees and appraisal fees, may be associated with the incentive.

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