Unlocking Savings: A Guide to Government Housing Incentives
Homeownership can be expensive especially for first-time buyers. However, there are many housing programs and incentives available to help out financially that can offer some relief.
We’ve outlined some of the most common federal and provincial housing incentives below. Some are targeted to groups like first-time homebuyers or those making improvements to make their homes more energy efficient.
Keep in mind these vary by province, depend on the circumstances of each buyer and change regularly. So, it’s always best to check the initiative’s website for the most current information. However, whatever situation your buyers are in, these incentives and programs are a chance to save them significant cash and are worth looking into.
Federal Programs:
First-time Homebuyers’ Programs
Home Buyers’ Amount Tax Credit
Through their tax return, first-time homebuyers with a qualifying home can claim up to $10,000 for its purchase. Qualifying homes include most residential types, including single-family, semi-detached, condominium, and townhouse. As well, buyers must not have lived in another home they owned in the acquisition year or the four years prior.
Learn more about the Home Buyer’s Amount tax credit and eligibility requirements.
First-time Home Buyer Incentive (FTHBI)
Administered by the Canada Mortgage and Housing Corporation (CMHC), the FTHBI program offers financial assistance through a shared equity mortgage with the Government of Canada.
The five to 10 per cent funding helps first-time home buyers reduce their mortgage payments without increasing their down payment. Then, within 25 years or when the home is sold, the same percentage value of the home gets paid back (up to eight per cent per year).
Learn more about the FTHBI program and eligibility requirements.
Tax-free First Home Savings Account (FHSA)
The FHSA offers first-time home buyers the chance to save $40,000, tax-free, with a yearly contribution limit of $8,000. Banks and financial institutions should be set up for the account as of this year.
Learn more about the FHSA program and eligibility requirements.
Home Buyers’ Plan (HBP)
Through the Canada Revenue Agency (CRA) ‘s HBP program, eligible home buyers can put up to $35,000 from their RRSP toward a down payment on their first home. This tax-free loan can be for a new or existing property the buyer plans on living in full-time within one year after buying it.
Learn more about the HBP program and eligibility requirements.
Energy Efficiency Programs
Greener Homes Loan (GHL)
GHL provides interest-free, 10-year financing for major recommended, energy-efficient home retrofits. Loan amounts range between $5,000 and $40,000.
Learn more about the GHL program and eligibility requirements.
Canada Greener Homes Grant (CGHG)
With energy-efficient renovation evaluation reimbursements and grants from $125 up to $5,000, CGHG helps homeowners save money while contributing to a greener future.
Learn more about the CGHG program and eligibility requirements.
Energy Savings Rebate Program (ESRP)
ESRP is a federal government partnership with Ontario retailers to make energy-efficient products more accessible to Ontarians. This is happening through $200 million over two years in point-of-sale rebates on eligible products.
Learn more about ESRP and eligibility requirements.
Oil to Heat Pump Affordability Program (OHPAP)
OHPAP helps those who use oil heating at home switch to new, energy-efficient heat pumps, with up to $10,000 to help offset the cost. This type of heating can save thousands each year on heating bills and lower GHG emissions.
Learn more about OHPAP and eligibility requirements.
Renovation Programs
GST/HST new housing rebate
Those who buy or build a new home or renovate their current home with a fair market value of under $450,000 and use it for their primary residence may be eligible for the GST/HST new housing rebate to get back some of those taxes.
Learn more about the GST/HST new housing rebate and eligibility requirements.
Home Accessibility Tax Credit (HATC)
The HATC offers seniors and others living with a disability a rebate of up to $10,000 on qualifying mobility modifications or renovations for their homes.
Learn more about the HATC program and eligibility requirements.
Multigenerational Home Renovation Tax Credit (MHRTC)
The MHRTC is a refundable tax credit of up to $7,500 per family. It lets eligible households use the funds to build a secondary unit that accommodates seniors or adults with disabilities.
Learn more about the MHRTC program and eligibility requirements.
Provincial Programs:
Land Transfer Tax Rebates: ON
Land transfer taxes are determined by a home’s purchase price and paid by your clients on closing. First-time home buyers in Ontario can get their land transfer taxes reduced.
Ontario buyers can claim applicable rebates of up to $4,000 and $4,475 from the provincial government and the City of Toronto, respectively. The home must be occupied within nine months of purchase. British Columbian buyers can receive rebates of up to $8,000 in rebates for home purchases up to $524,999. PEI buyers can claim up to $2,000 for properties bought for up to $200,000.
Learn more about land transfer tax rebates in Ontario, and Toronto