Buying Your First Home in BC? Programs That Could Help

Buying your first home can feel like a big stretch, especially when you’re trying to save for a down payment while keeping up with the cost of living. But before you assume homeownership is out of reach, it’s worth understanding what help is available.

There are several programs that may make buying your first home a little more manageable. Here are a few worth knowing about.

Start with your down payment

You don’t necessarily need 20% down to buy a home. For eligible homes priced under $1.5 million, the minimum down payment is generally 5% on the first $500,000 and 10% on the portion above that.

You’ll still need to qualify for a mortgage and budget for closing costs, but understanding the minimum requirements is a good place to start.

Take advantage of savings programs

The First Home Savings Account (FHSA) lets eligible buyers contribute up to $8,000 per year, to a lifetime maximum of $40,000. Contributions are generally tax-deductible, and qualifying withdrawals to buy a first home are tax-free.

The federal Home Buyers’ Plan is another option. It allows eligible buyers to withdraw up to $60,000 per person from their RRSP to purchase a qualifying home, with repayment generally required over 15 years.

Depending on your circumstances, you may be able to use both programs.

Look into tax savings

There are also programs that could reduce the costs of buying.

• BC First-Time Home Buyers’ Program: Eligible buyers may receive a full or partial property transfer tax exemption, depending on the home’s value and other eligibility requirements.

• Newly built homes: Separate BC property transfer tax exemptions may apply to qualifying new builds.

• Federal Home Buyers’ Amount: Eligible buyers can claim a federal tax credit that may provide up to $1,500 in tax relief.

• Federal GST/HST rebate: Eligible first-time buyers purchasing qualifying new homes may be able to receive a rebate of up to $50,000.

Each program has its own rules, so it’s important to confirm your eligibility before counting on the savings.

Know what you can comfortably afford

Before you start viewing homes, speak with a mortgage professional to understand your budget, monthly payments and financing options. Some eligible first-time buyers may also qualify for a 30-year insured mortgage amortization, which can lower monthly payments but generally means paying more interest over time.

Remember, qualifying for a mortgage and feeling comfortable with the payments are two different things.

Ready to take the first step?

You don’t need to have everything figured out before you begin. Start by understanding your options, getting a realistic picture of your budget and learning what’s happening in the local market.

If you’re thinking about buying your first home in South Surrey, White Rock, North Delta, Surrey, Langley or the surrounding areas, I’m happy to help you understand the process and work through your questions, one step at a time.

Sometimes, the best first step is simply having a conversation.

This article is for general information only. Program rules and eligibility requirements can change. Confirm current details with the relevant government agency, mortgage professional or tax advisor.