First time home buyers grant

This first time home buyers grant is a proposal for a tax credit. Many home owners are unaware that Realtors play a very large role advancing the best interests of home buyers and sellers. NEW... Rent to buy a home. Bad Credit, no credit, no or little down payment. See article at end of page.

The last such effort came in significant changes to the Toronto Land Transfer taxes, which would have been more burdensome on Toronto residents than they presently are.

Realtors continue to work to have the land transfer tax scrapped entirely as it has been shown by a recent C.D. Howe report to be having a negative effect on the Toronto real estate market.

Realtors continue to work for property owners, and this was most recently demonstrated in the Federal Budget announced on January 28, 2009.

REALTORS’® lobbying efforts have achieved significant victories in the recently announced 2009 Federal Budget, including proposals to expand the RRSP Homebuyers’ Plan, provide a First-Time Home Buyers’ Tax Credit, and provide a Home Renovation Tax Credit.

The implementation of these announcements depends on the approval of the Budget by the House of Commons. Remember to check back for updates on these proposals.

Under the leadership of the Canadian Real Estate Association, REALTORS® from across the country, including TREB members, played a key role in convincing the federal government to move ahead with these initiatives.

Many first time home buyers will be pleased to learn about the proposed tax credit. And REALTORS’® efforts focused on expanding the RRSP Home buyers’ Plan to make it more useful for home buyers.

REALTORS® have been lobbying on this issue for a number of years.

• This first time home buyers grant proposes a 15 per cent credit that would be applied to a $5,000 amount, and would provide up to $750 in tax relief to reduce costs associated with first home purchases.

• To assist first-time home buyers with the costs related to the purchase of a home such as legal fees, land transfer taxes, etc.

• The federal budget proposes to increase the withdrawal limit for first-time home buyers using the Home buyers Plan from $20,000 to $25,000 (per individual).

• Under this program, first-time home buyers are allowed to withdraw funds from their RRSP, tax-free, to put towards the down payment on a home. Amounts withdrawn under the HBP must be repaid over a 15-year period, starting the second year following the year of the withdrawal.

• Since 1992, an estimated 2 million Canadians have used the Home Buyers’ Plan to purchase approximately 900,000 homes, making this program a huge success.

Unfortunately, as time has passed, the usefulness of this program eroded because withdrawal limits were not adjusted.

For this reason, REALTORS® lobbied the federal government to increase the Home Buyers’ Plan withdrawal limit to $25,000. A welcomed increase for one of the few first time home buyers grants.

• The Budget proposes a 15 per cent credit to be claimed on the portion of eligible home renovation expenditures exceeding $1,000, but not more than $10,000, meaning that the maximum tax credit that can be received is $1,350.

• Will apply to eligible home renovation expenditures for work performed, or goods acquired, after January 27, 2009 and before February 1, 2010, pursuant to agreements entered into after January 27, 2009.

• Credit can be claimed on eligible expenditures incurred on one or more of an individual’s eligible dwellings, including houses, cottages, and condominium units owned for personal use. Additional information available about the home renovation tax credit available by clicking here.

Additional Information.

An overview of the government’s budget announcements is available by clicking here for the Federal government's website.

For further information about first time home buyers grants, and/or to make an appointment with me for all of your real estate needs please click here to contact me.

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