If you're a first-time homebuyer in Vancouver, you might be wondering if there are any government incentives available to help ease the financial burden of purchasing your first property. The good news is, yes – there are several government programs and incentives designed to make homeownership more accessible for first-time buyers in British Columbia. In this article, we’ll explore some of the top incentives that could help you secure your first home in Vancouver.
The government shares a small portion of your home’s value. When you sell or refinance your home, you pay them back based on how much your home is worth at that time, not the original loan amount.
1. Home Buyers’ Plan (HBP)
The Home Buyers’ Plan allows first-time homebuyers to withdraw money from their RRSPs (Registered Retirement Savings Plans) without paying tax, to help with the down payment. Starting on April 16, 2024, you can withdraw up to $60,000 (previously $35,000) per person. If you're buying with a partner, you could use up to $120,000 in total.Key points to remember:- You don’t have to withdraw the full amount. You can leave some savings in your RRSP for retirement while still using some for your down payment.
- The money you withdraw must be repaid into your RRSP within 15 years to avoid taxes.
- Learn more on the Government of Canada’s website.
2. Property Transfer Tax (PTT) Exemption
In British Columbia, first-time homebuyers may not have to pay Property Transfer Tax (PTT) if the home costs $835,000 or less. You’ll get an exemption for the first $500,000 of the home’s price.If the home is worth between $835,000 and $860,000, you might qualify for a partial exemption. Even if one person has owned a home before, you may still be eligible for a partial exemption.3. BC Home Owner Grant
After you buy a home, the BC Home Owner Grant helps reduce your property taxes. If your home is valued at up to $2.15 million, you could get:- Up to $770 in tax relief for most homeowners.
- Up to $1,045 for seniors, veterans, and people with disabilities.
4. BC New Housing Property Transfer Tax Exemption
If you’re buying a newly built home, starting April 1, 2024, you can be exempt from Property Transfer Tax if the home costs up to $1.1 million. There are partial reductions available for homes priced between $1.1 million and $1.15 million. Visit the BC Government website to learn more.6. GST/HST New Housing Rebate
For first-time homebuyers purchasing a newly constructed home in Vancouver, the GST/HST New Housing Rebate can offer a rebate on part of the GST or HST you paid on the home purchase. The rebate can cover up to 36% of the GST paid on a new home, to a maximum of $6,300, depending on the cost of the property.The rebate is available for homes purchased under $350,000 and can help reduce the overall cost of buying a new construction home.7. First-Time Home Buyers’ Tax Credit (HBTC)
The First-Time Home Buyers’ Tax Credit gives you a tax break of up to $1,500 to help cover some of your home buying costs. You can claim up to $10,000 on your tax return for the year you bought your home. Find more details on the Government of Canada’s website.8. 30-Year Mortgages
Starting December 15, 2024, first-time homebuyers can qualify for 30-year mortgages. This means you’ll have more time to pay off your mortgage, which can reduce your monthly payments and make owning a home more affordable. From August to December 2024, this will only apply to buyers of new homes, but after that, it will be available to all first-time buyers.9. Tax-Free First-Time Home Savings Account (FTHSA)
The FTHSA allows you to save for your first home tax-free. You can contribute up to $8,000 per year (with a lifetime limit of $40,000) towards your down payment. The money you contribute is tax-deductible, and when you withdraw it to buy your home, it’s not taxed. This new account started in August 2023 and can help you save more for your home without paying taxes on your savings.10. First-Time Home Buyer Incentive (FTHBI)
The First-Time Home Buyer Incentive (FTHBI) is a government program to help reduce your monthly mortgage payments without needing a bigger down payment. The government, through the Canada Mortgage and Housing Corporation (CMHC), gives you a loan to cover 5% of the price for an existing home or 10% for a newly built home.Here’s how it works:The government shares a small portion of your home’s value. When you sell or refinance your home, you pay them back based on how much your home is worth at that time, not the original loan amount.