TL;DR: What First Time Home Buyer Programs are There in Western Canada?
This post will break down the main First Time Home Buyer programs in western Canada – primarily Alberta and British Columbia.
We will break this into 2 parts:
- National Programs
- Provincial Programs
The National Programs that currently exist in Canada are:
- First Time Home Buyer’s Incentive (FTHBI)
- Home Buyer’s Plan (HBP)
- First Time Home Buyer’s Tax Credit (HBTC)
- GST/HST Tax Rebate
- First Home Savings Account (FHSA)
In BC there are the following programs for First Time Home Buyers:
- BC First Time Home Buyer’s Program
- BC Home Owner Grant
- Newly Built Home Exception
In Alberta, there are 2 main programs for Alberta’s major cities:
- Attainable Homes Calgary (AHC)
- First Place Home Ownership [Edmonton]
National First Time Home Buyer Programs
First Time Home Buyer Incentive (FTHBI)
What is the program for/what it does
The Government of Canada helps increase your down payment by providing an “equity sharing”, interest-free loan.
High-level Details
- If you are eligible, you can apply for a loan of 5%-10% of your home’s purchase price.
- The loan is interest free
- When you sell your home or after 25 years (which ever is first) you’ll owe the original loan amount plus a share of your home’s equity
- This program allows you to put in a larger down payment which can help in 2 main ways:
- Increase your buying power by adding more cash down payment
- Decrease the default insurance premium that is required by the mortgage insurers
Home Buyer’s Plan (HBP)
What is the program for/what it does
Allows you to use up to $35,000 for down payment on your first home from your RRSPs as an interest-free loan without having to pay taxes on the amount.
High-level Details
- To qualify you must be a first time home buyer and intend for the home to your principal residence within a year of buying it or it being built
- The RRSP funds have to be repaid to your RRSP within 15 years
First-Time Home Buyers’ Tax Credit (HBTC - Home Buyer’s Tax Credit)
What is the program for/what it does
A tax credit for first time home buyers that allows them to reduce their taxable income.
High-level Details
- When you do your taxes in the year you bought your house, you can reduce your taxable income by $10,000
- Results in a tax rebate up to $1,5000
- If you owe less than $1,500 in taxes, you can only reduce your taxes down to $0
- For more details, here’s the link to Canada’s formal document on the HBTC: LINK
GST/HST New Housing Rebate
What is the program for/what it does
If you are buying or building a home as a primary residence (house for you to live in) then you could receive a tax rebate on the GST or HST of the property.
High-level Details
- Needs to be your main residence
- Not for 2nd homes or investment properties
- For more details, here’s the link to Canada’s formal document on the GST/HST New Housing Rebate: LINK
First Home Savings Account (FHSA)
What is the program for/what it does
A new and special tax advantage account that you can withdraw funds for down payment on your first home.
High-level Details
- You can deposit up to 40k into the account at roughly 8k per year
- Deposits are tax deductible and the account acts like an RRSP in that the tax for a standard withdrawal (not for the purpose of buying your first home) is associated to your tax bracket at the time of that withdrawal
- Here’s a detailed blog post about all the details of the account here:
BC’s Programs for First Time Home Buyers
BC First-Time Home Buyer’s Program
What is the program for/what it does
In BC, when you buy a property there is a tax called Property Transfer tax.
The First-Time Home Buyer’s Program exempts FTHB’s from paying this tax in many cases.
High-level Details
- The buyer must be a first time home buyer and have files 2 income tax returns as a BC resident in the last 6 tax years before buying
- The property needs to be your primary residence
- The property must have a fair market value of $500,000 or less for the full exemption and a partial exemption can be granted for properties up to $525,000
BC Home Owner Grant
What is the program for/what it does
Reduces the property taxes owed on your principle residence.
High-level Details
- The regular grant is $570 for properties in the following regions:
- Capital Regional District
- Metro Vancouver
- Fraser Valley
- For other regions, the grant goes up to $770
- To qualify you must be the registered owner of the property and the property must be your principle residence. To get the full grant, your property must also be below $2,125,000 in value
- If you’d like to read more, here is a link directly to BC’s website on their Home Owner Grant: LINK
Newly Built Homes Exemption
What is the program for/what it does
Similar to the BC First Time Home Buyer’s Program but is for newly built homes.
Allows a higher property limit for the exemption.
High-level Details
- Same details as the BC First Time Home Buyers Program BUT the property can be up to $750,000 for the full exemption. The property can get a partial exemption up to $800,000
- Partial exemption given if there is another building on the property that is not your principal residence
Alberta's First Home Buyer Programs
Attainable Homes Calgary (AHC)
What is the program for/what it does
Similar program to the FTHBI program – i.e. it’s an equity sharing program with the government.
High-level Details
- A down payment loan that helps you fun dup to 5% of the property in down payment
- Has income and property restrictions
- Needs to be paid back along with a share in the equity of the property
- For more notes, here’s Calgary’s official documentation on the AHC program: LINK
First Place Home Ownership Program
What is the program for/what it does
A program that converts surplus school sites into town homes and let’s first time home buyer buy at reduced terms.
Defers the land portion of the purchase price for 5 years so the buyer only pays for the cost of the building and associated building costs.
High-level Details
- Only applicable to specific properties that the city of Edmonton decides on. Also only applicable with certain lenders / banks
- Edmonton has a great write up of how the program works. You can find it here for more details: LINK