The federal government has assistance programs to help homebuyers. Research government program requirements to see if you are eligible.
- First-Time Home Buyers’Tax Credit – a $5,000 non-refundable income tax credit on a qualifying home. The credit provides up to $750 in tax relief to assist first-time buyers with purchase costs.
- Home Buyers’ Plan – a one-time withdrawal up to $25,000 from a Registered Retirement Savings Plan (RRSP) by first-time buyers to help purchase or build a home. Generally, you have to repay all withdrawals from your RRSP within 15 years.
- CMHC Green Home program – when you use CMHC-insured financing to buy or build an energy-efficient home or make energy-saving renovations, you may qualify for a premium refund of 10% on your mortgage default insurance and a premium refund for a longer amortization period (if applicable). Check out CMHC’s website for more information: www.cmhc.ca.
When buying a home in BC, the buyer automatically pays the provincial Property Transfer Tax (PTT). The tax is payable on the fair market value of the home or other property. This is different from the property tax. You pay property tax on an annual basis for services you receive from your local government.
The tax is charged at a rate of 1% on the first $200,000 of the fair market value of the property, and 2% on the rest.
For example, if the fair market value of the property is $150,000, the tax is 1% of $150,000 or $1,500.
If the property's fair market value is $500,000 the tax is 1% of $200,000 ($2,000) plus 2% of the remaining $300,000 ($6,000) for a total tax of $8,000.
Qualifying first-time buyers may be exempt from paying the PTT of 1% on the first $200,000 and 2% of the remainder of the purchase price of a home priced up to $475,000. There is a proportional exemption for homes between $475,000 and $500,000. At $500,000 and above there is no rebate.
For more information, please read Guide to the First Time Home Buyers' Program.