First Time Home Buyers Incentive Plan
The 2019 Federal Budget meeting was concluded on March 19th with the below notable changes to be made to Canadian mortgaging by Fall of 2019. Our brokerage is optimistic by these changes but disappointed in the low impact this will have of overall buyers in our Canadian market. There is also an associated risk with the future repayment of the incentive and something that we are eager to learn more about in the upcoming days and months.
The new CMHC First-Time Home Buyers Incentive Plan represents a shared equity mortgage program that would give eligible first-time home buyers the ability to lower their borrowing costs via equity sharing with CMHC of up to 5% of the purchase price of an existing home, or 10% of a new build. No repayment required monthly. The buyer would repay the incentive, for example at resale.
Only eligible for households earning $120,000 annual income or less. Max eligibility lets them borrow no more than four times the annual household income.
Further noted is an additional increase in the eligible RRSP withdrawal amount through the Home Buyers’ Plan (HBP). Previously $25,000, this has been increased to a maximum to $35,000.
Please contact MMG Mortgages for further information and get our take on the upcoming changes.