First-Time Home Buyer Programs in Vancouver, BC

The government has put together a few programs to assist first time home buyers in buying their first property in Vancouver, and some that are applicable to any home buyer, so make sure you familiarise yourself with these, and find out which ones can apply to your situation.

While you won’t literally be handed money, these programs can make your home buying journey more affordable!

First Home Savings Account

This is one of the newest programs available, which launched April 1, 2023. A First Home Savings Account (FHSA) is a registered plan allowing first-time home buyers to save for their first home tax-free. It is similar to an RRSP in that your contributions will be tax-free, and similar to a TFSA, in which your qualifying withdrawals will also be non-taxable. 

To open a first home savings account you must be:

  1. A canadian citizen

  2. 18 years or older

  3. A first-time home buyer

Every year you can contribute $8,000 up to a lifetime contribution limit of $40,000. A maximum of $8,000 of unused contribution room can carry forward to the following year and the account can stay open for a maximum of 15 years or until the end of the year you turn 71. If you haven’t done so already, this is a good program to look into right away with your bank, so that when you are ready to purchase your first home you’ve already got a leg up. 

First-Time Home Buyers’ Tax Credit

The First-Time Home Buyers’ Tax Credit is a non-refundable tax credit for first-time home buyers who buy a qualifying home. 

Basically, you can recover some of the costs from your home purchase, which can offset those extra costs you paid such as legal fees, inspections or other closing costs. You and a spouse or common law partner can claim a combined $10,000, which at a tax rate of 15%, is a maximum of a $1,500 rebate. 

Even if you’ve already owned a home in the past, this tax credit could apply to you as it also applies to those that haven’t owned a home in more than 4 years. Though if you don’t owe any income tax the year you buy a home, there is no benefit to this tax credit.  

First-Time Home Buyers’ Incentive 

The First-Time Home Buyers’ Incentive is a program built to help home ownership become more achievable for first-time home buyers by reducing their monthly payments. In short, it is a shared-equity mortgage with the Government of Canada. 

The loan amount can range from 5-10% of the home's purchase price, depending on the type of home, which can be put towards your down payment to reduce your monthly mortgage costs. The loan is not interest-bearing and does not require ongoing payments. However, you have to repay the loan within 25 years or when the property is sold, whichever comes first. You can also repay this loan anytime without a penalty.

First-Time Home Buyers’ Program

The First-Time Home Buyers’ Program reduces or eliminates the amount of property transfer tax you pay on your home purchase. To give you some context into how much property transfer tax actually is, it’s calculated in a tiered way as follows:

1% on the first $100,000

2% on the amount from $200,000 to $2,000,000

And 3% on the amount above $2,000,000

If you’re hitting the $3,000,000 mark, you’ll be paying an extra 2% on the amount above that. But as a first time home buyer in Vancouver you probably don’t have to worry about that!

So for a $500,000 property, property transfer tax is $8,000. 

To qualify for a full exemption, among the basic qualifications, the property must have a market value of below $500,000 and below $525,000 for a partial exemption. If you’re buying within Vancouver this may not be applicable because most condos are priced above this, even at the bottom end of the market, but if you keep your eye out you can actually find some properties listed below this price!

RRSP Home Buyers’ Plan

As the name suggests, you’ll have to have an RRSP account already for this one to be applicable. The Home Buyers’ Plan (HBP) is a program that allows you to withdraw up to $35,000 tax-free in a calendar year from your registered retirement savings plan (RRSPs). This money would go specifically to fund your down payment for buying a home or building a qualifying home for yourself or for a related person with a disability. 

The Home Buyers’ Plan can be a great option because generally, early withdrawals from your RRSP is considered taxable income - and really, when buying your first home, every bit of savings counts! You will need to start repaying the amount you took from the RRSP 2 years after buying, over a 15-year period. And keep in mind the money taken must be in your RRSP for at least 90 days prior to the purchase.

GST New Housing Rebate

GST is a whopping 5% of a purchase price, and can easily become one of the largest taxes on buying a new home or one that has been substantially renovated. 

As a first-time home buyer you can apply for a GST credit from the government and/or developer, which can offset part of the GST costs on your home as long as the home is under $450,000. Again, within Vancouver this would be hard to find, though as you move further away this becomes more possible so I wanted to include it!

Now that you know some programs to help you save some money on your home purchase, I have a home buyer guide built just for you that I would love to share. I’ve linked it HERE! Reach out if you have any questions or would like to start your home search!

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