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In addition to the "standard" steps required to purchase a home in British Columbia, there are several Government Programs available to First Time Home Buyers and those looking to get into the market.
BC First Time Home Buyers’ Program
This program reduces any amount owing for property land transfer tax when buying your first property. You may be eligible for a partial or full tax exemption under the program. For full exemption, the property must have a fair market value of of $500,000 or less. A partial exemption for properties valued under $525,000.
The Home Buyers' Plan (HBP) is a program specifically designed to assist first-time home buyers in purchasing their first property. Under the HBP, you can withdraw up to $25,000 (or up to $50,000 combined, if you’re buying with a partner) in a single calendar year from your Registered Retirement Savings Plan (RRSP) towards the purchase of a qualifying property for yourself or someone with a disability.
Government of Canada's First-Time Home Buyer Incentive
The First-Time Home Buyer Incentive helps qualified first-time home buyers reduce their monthly mortgage carrying costs without adding to their financial burdens. This is a new program with fairly limiting parameters. A few qualifiers include having the minimum down payment required. Your maximum qualifying income must be no more than $120,000 and your total borrowing is limited to 4 times the qualifying income. If you meet these criteria, you can then apply for a 5% or 10% shared equity mortgage with the Government of Canada. A shared equity mortgage is where the government shares in the upside and downside of the property value.
This tax credit offers a $5,000 non-refundable amount when you file your tax return the following year. The credit offers you up to $750. To find out if you are eligible speak to your accountant when filing your tax return.
GST New Housing Rebate
You may be eligible for a tax rebate on a portion of the GST you paid as part of the purchase or construction of a new home. You may also be eligible for a rebate of the costs of substantially renovating your property, building an add-on to your existing home, or converting a commercial property into a residential home. This rebate can be claimed on a newly constructed or substantially renovated property only if the fair market value of the house is under $450,000 upon completion.
Under the B.C. Home Owner Grant, you may be eligible to lower the amount of property taxes you’re required to pay on an annual basis for your principal residence. The amount of tax relief you’re eligible for depends on where you live. For instance, those under 65 years of age residing in the Capital Regional District, Greater Vancouver Regional District, and the Fraser Valley Regional District may be eligible for a grant of $570. Home owners residing in other parts of British Columbia may be eligible for a grant of $770.
Newly Built Home Exemption
Are you buying a newly built home in B.C.? You may be eligible for the Newly Built Home Exemption?. This tax exemption helps lower or eliminate the amount of property transfer tax you’re required to pay when you’re buying a newly built home worth $750,000 or under.