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Published March 29, 2022

First-time Home Buyer Grants and Assistance Programs

Various Canadian grants and assistance programs provide financial incentives that can make it easier and more affordable to buy your first house.

Buying a home is an expensive undertaking. Grants and assistance programs are in place to help Canadians manage the cost of buying or building their first home. These programs exist on both federal and provincial levels and have varying requirements for eligibility. Finding out how many programs you might qualify for can make buying your first house more affordable.

» MORE: Steps to buying a house in Canada

What is a first-time home buyer grant?

A first-time home buyer grant is a type of government incentive program to help eligible Canadians who are looking to purchase their first home. The goal is to make buying a home more affordable and this is done in several ways through a series of different grants and programs.

While some of these programs are actual grants (i.e. you get to keep the money without repayment), a few fall under the category of a loan and do need to be paid back within a predetermined period of time. It’s up to you to do your research and be aware of the rules and regulations surrounding these grants and assistance programs to ensure you make the most of them.

» MORE: How much mortgage can I afford?

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First-time home buyer grant and assistance options in Canada

First-time Home Buyers’ Tax Credit

The First-time Home Buyers’ tax credit, which is also referred to as the Home Buyers’ amount, allows Canadians who qualify to claim a $5,000 non-refundable income tax credit against their new home. This means that eligible Canadians can get up to a $750 tax rebate. While it might not be a ton of money, it’s a decent amount that will help make buying your first home a little easier.

First-Time Home Buyer Incentive

Eligible first-time home buyers can take advantage of this program to help reduce monthly mortgage payments. The First-time Home Buyer Incentive is a shared-equity mortgage with the Government of Canada which means that you, as the potential home buyer, don’t have to save as much of a down payment to be able to afford the mortgage.

How much the Government of Canada offers depends on the type of home you want to buy but it will be either 5% or 10% of the purchase price. Keep in mind that this is a loan, not a grant. The money has to be paid back to the Government of Canada within 25 years or when you sell the home, whichever comes first.

Land Transfer Tax Rebate

If you are a first-time home buyer in a specific province or municipality, then you might be eligible for the land transfer tax rebate. Those who are eligible can qualify for a rebate equal to the full amount of their land transfer tax up to a maximum amount, depending on where the home is located. Eligible areas include Ontario, Toronto (where you may be eligible for both a Toronto and Ontario tax rebate), British Columbia and Prince Edward Island.

Home Buyers’ Plan

The Home Buyers’ Plan allows Canadians to withdraw from their registered retirement savings plan, or RRSP, to help either purchase or build a home for themselves or a related person with a disability. There are several conditions that must be met in order to qualify, however, those who do qualify can withdraw up to $35,000 from their RRSP to buy or build  a new home. If you are buying a home with a partner, they can also withdraw up to $35,000, allowing you a total of $70,000. Keep in mind, in order to keep this withdrawal tax-free you do need to pay back the funds within a 15-year period.

GST/HST New Housing Rebate

With the GST/HST New Housing Rebate you might be eligible to get back some of the GST or the federal portion of the HST paid on a new or significantly renovated home that is used as a primary residence. Of course, like the other grants and programs on this list, there are a number of conditions you must meet to be eligible for this rebate. However, for those who qualify, it can be another good money saver. Keep in mind that on top of federal level savings, there may be programs for the provincial portion of your HST as well.

Canada Greener Homes Grant

In an effort to encourage Canadians to live in more energy-efficient homes and help the fight against climate change, the government of Canada introduced the Canada Greener Homes Grant. Grants of up to $5,000 are available to help homeowners make their homes more energy efficient. There’s also up to an additional $600 available for EnerGuide evaluations and expert advice . You can apply for this grant online.

How to find additional grants and assistance programs

The first-time home buyer grants and programs listed here are mostly at the federal level, but that doesn’t mean you need to stop there. Many provinces and even municipalities also have programs for first-time home buyers, so it’s worth your time to do a bit of digging to see what else might be available via other levels of  government. For example, several municipalities in Ontario have home ownership programs.

About the Author

Hannah Logan

Hannah Logan is a writer and blogger who specializes in personal finance and travel. You can follow her personal travel blog EatSleepBreatheTravel.com or find her on Instagram @hannahlogan21.

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