What are the first-time home buyer programs in Ontario
The Welcome Home Niagara Homeownership Program (Niagara)
What's this? An interest-free loan worth 10% (capped at $66,774) of the home's purchase price (max purchase price is $662,000). If you end up keeping the home for 20 years as your principal residence, the loan is forgiven. But, if you sell or leave before the 20 years, the loan must be repaid plus 10% of the home's capital appreciation. Hit the link here for more info: https://www.niagararegion.ca/government/incentive-programs/affordable-housing/ownership-program.aspx
Land Transfer Tax Refund for First-Time Buyers (Ontario)
When you buy a home, a provincial land transfer tax is due at closing. If you were to purchase a home in Stoney Creek for $700,000, your land transfer tax would be $6,475 ($10,475 - $4,000). As mentioned in my previous post, ensure that you set aside funds for land transfer tax as part of your closing costs.
The First Home Savings Account (FHSA)
This savings plan combines the best parts of an RRSP and a TFSA. You can contribute $8,000/year (up to a $40,000 max, lifetime). The money put in lowers your income tax bill, as it gives you a tax deduction, gives you tax-free growth which you can then pull out tax-free to buy your first home.
New Build Rebate Program (Up to $130,000 in savings)
While the full program is still pending legislation (as of the day this was posted), the program proposed offers first-time home buyers a rebate worth up $130,000 for a home purchased for $1 million or less, and a gradual phase-out from $1 million to $1.5 million). Always check with the builder if the rebate has been factored into the price or if it is to be claimed by you after closing.
The Home Buyers' Plan (HBP)
If you have an RRSP, the government allows you, as a first-time home buyer, a tax-free withdrawal up to $60,000 to use as a down payment. Your partner is also allowed to do the same for the same purchase, giving you $120,000 to put down. The catch is that you have 15-years to pay that back into your RRSP.
