Skip Navigation Site map

First-Time Home Buyer Incentive Program

Posted by Sunil Saini on Friday, November 1, 2019 2:47pm

The newly introduced First-Time Home Buyer Incentive helps qualified first-time homebuyers reduce their monthly mortgage carrying costs without adding to their financial burdens.

There are a few qualifiers to apply for this incentive:

  • you need to have the minimum down payment to be eligible
  • your maximum qualifying income is no more than $120,000
  • 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.

How does it work? 

The Incentive enables first-time homebuyers to reduce their monthly mortgage payment without increasing their down payment. The Incentive is not interest bearing and does not require ongoing repayments.   

Through the First-Time Home Buyer Incentive, the Government of Canada will offer: 

5% for a first-time buyer’s purchase of a re-sale home 
5% or 10% for a first-time buyer’s purchase of a new construction 

How do I know how much I have to pay back? 

You can repay the Incentive at any time in full without a pre-payment penalty. You have to repay the Incentive after 25 years or if the property is sold, whichever happens first. The repayment of the Incentive is based on the property’s fair market value. 

You receive a 5% incentive of the home’s purchase price of $200,000, or $10,000.
If your home value increases to $300,000 your payback would be 5% of the current value or $15,000. 
You receive a 10% incentive of the home’s purchase price of $200,000, or $20,000 and your home value decreases to $150,000, your repayment value will be 10% of the current value or $15,000. 

NOTE: If your property value goes down, you are still responsible for repaying the shared equity mortgage based on the current home value at time of repayment.  

 Eligibility Criteria

Do you meet the requirements as a First-time Home Buyer?
You are considered a first-time homebuyer if you meet one of following qualifications:

you have never purchased a home before
you’ve recently experienced a breakdown of a marriage or common-law partnership in the last 4 years, you did not occupy a home that you or you current spouse or common-law partner owned

Further details about the program, criteria, eligibility and application procedure can be found out at -

In my personal opinion, this program does not suit every buyer as some buyers are better off not using this program. If you want to know if you should opt for this incentive program or if you should stay away, call me. 

In case you need any additional information about the program or if you simply want to know your options, please call -

Sunil Saini

Cell: 416 371 9252

Leave a Comment

Format example:
Format example: