Home Buying

A Complete Guide To First-Time Homebuyer Grants In Canada

A Complete Guide To First-Time Homebuyer Grants In Canada

Table of contents

    Buying a home for the first time can be overwhelming. Between saving enough money for a down payment, navigating the complex mortgage process and finding the right property, it can take time to figure out where to begin. 

    Fortunately, the Canadian government offers various programs and grants to help first-time homebuyers realize their homeownership dreams. This post will explore some of Canada’s most popular first-time home buyer grants.

    Key Takeaways

    • Financial assistance is available to first-time homebuyers across Canada thanks to various government grants and programs.
    • Access to first-time home buyer grants allows you to save money on eligible home purchase costs.
    • The RRSP Home Buyer’s Plan (HBP) allows a maximum of $35,000 ($70,000 per couple) towards buying your first home.

    Are you a first-time buyer?

    First-Time Home Buyers’ Tax Credit (HBTC)

    The HBTC is a federal government program to help offset the closing costs of buying your first home. As a first-time homebuyer in Canada, the HBTC enables you to claim up to $10,000 on your tax return, resulting in a $1500 tax rebate. You must apply to receive the credit on your tax return in the same year you purchase a home. 

    See: Who Can Benefit From the Home Buyers’ Tax Credit (HBTC)?

    Land Transfer Tax Refund (LTTR)

    Land Transfer Tax is the tax you must pay to the province (and the municipality, in the case of Toronto) when you buy a property. In some provinces – Ontario, British Columbia and Prince Edward Island there are rebates available as a refund for all or a portion of the land transfer tax you need to pay in these provinces. The City of Toronto also has a municipal land transfer tax (MLTT) rebate available. 

    To claim the LTTR in Ontario

    • You must be at least 18 and a Canadian citizen or permanent resident (or become one within 18 months of the purchase).
    • Have not previously owned a home or had an interest in one anywhere in the world. 
    • You must occupy the home as your primary residence within 9 months after the title is registered in your name. 
    • You must apply for the refund within 18 months after registration.

    Note: If you claim the MLTT rebate in Toronto, the above criteria apply.

    To claim the LTTR in British Columbia

    • You must be a Canadian citizen or permanent resident.
    • Have never received the first-time homebuyer exemption or refund.
    • Have not previously owned a home or had an interest in one that was your primary residence anywhere in the world. 
    • You must have lived in BC for at least 1 year immediately before the date you register the property or have filed at least 2 income tax returns as a resident of BC within the past 6 years. 
    • The property must be your primary residence.
    • The property must have a fair market value of $500,000 or less.
    • The property must be 0.5 hectares (1.24 acres) or less.

    Note: A partial tax exemption sometimes applies when the above property criteria aren’t met. 

    To claim the LTTR in Prince Edward Island

    • You must be at least 18 years old and a Canadian citizen or permanent resident. 
    • You must have maintained a principal residence in PEI for at least 6 consecutive months immediately before the date of registration or filed at least 2 income tax returns within the past 6 years as a resident or occupy the subject property as a principal residence for 6 months following the registration of the deed. 
    • Have not previously owned a home or had an interest in one that was your primary residence anywhere in the world. 
    • Have never received the first-time homebuyer exemption.
    • The property must be your primary residence.
    Region Ontario Toronto British Columbia Prince Edward Island
    Maximum Refund $4,000 $4,475 $8,000 $2,000
    Home Value Restrictions $368,000 maximum $400,000 maximum $500,000 maximum $200,000 maximum

    See First-Time Home Buyer Programs in Canada. First-time homebuyers in these areas may be eligible for a refund of all or part of the Land Transfer Tax. See Everything You Need to Know About the Land Transfer Tax

    RRSP Home Buyer’s Plan (HBP)

    The federal government’s Home Buyers’ Plan (HBP) allows first-time homebuyers to withdraw up to $35,000 ($70,000 for a couple) from their RRSPs on a tax and interest-free basis to buy or build a qualifying home for themselves or a relative with a disability. You’re considered a first-time home buyer if you didn’t occupy a home you or your current spouse or common-law partner owned in the past four years. 

    The only time you don’t need to be a first-time home buyer to qualify for the HBP is if you have a disability or you’re helping a related person with a disability buy or build a home. The new home must be a better fit for the needs of the disabled person than their current home. 

    To be eligible for the HBP 

    • You must be considered a first-time homebuyer.
    • You must be a resident of Canada when you withdraw funds from your RRSPs and up to the time a qualifying home is purchased or built. 
    • You must have a written agreement to buy or build a qualifying home for yourself or a related person with a disability.
    • You or the related person with a disability must intend to occupy the home as the principal residence within 1 year after buying or building the home. 
    • If you previously participated in the HBP, you may be able to do so again if the balance on January 1st of the year of withdrawal is 0 and you meet all other eligibility criteria

    See: What is the RRSP Home Buyers’ Plan (HBP)?

    GST/HST New Housing Rebate (NHR)

    If you’re purchasing a newly built home from a builder or building or customizing your home, you may qualify for a rebate of the provincial GST or the federal part of the HST you paid. Details of the rebate vary by province. 

    For instance, Ontario’s new home rebate application must be filed within two years of the new home closing date. The maximum Ontario new housing rebate amount for owner-built houses depends on whether you paid the HST on purchasing the land. The Ontario new housing rebate on owner-built houses is limited to a maximum of $24,000 if you paid the HST on the purchase of the land and $16,080 if you didn’t. For homes purchased from a builder, the maximum rebate available is $24,000.

    Home Adaptations For Seniors’ Independence (HASI)

    Home Adaptations for Seniors’ Independence (HASI) is a program from CMHC designed to help First Nations and First Nations members pay for on-reserve adaptions to their properties to help seniors live comfortably and independently in their homes. 

    To be eligible for the HASI

    • You must be 55 or older and have difficulties with daily activities due to age.
    • The home must be your permanent residence.
    • The household income must be at or below the established limit based on the communities location.

    You could be eligible for up to a $20,000 forgivable loan (as long as you occupy the home for at least 6 months after adaptions are made), or if the property is on-reserve in a northern or remote area, the maximum amount may be increased by an additional 25%.

    This program will help cover adaptions that are permanent and fixed to the home, such as handrails, door lever handles, walk-in showers and grab bars or bathtub grab bars and seats, and easy-to-reach work and storage areas in your kitchen. Other adaptions may be covered if they are permanent and fixed to the home. 

    Frequently Asked Questions

    Welcome to our Frequently-Asked Questions (FAQ) section, where we answer the most popular questions designed and crafted by our in-house mortgage experts to help you make informed mortgage financing decisions.

    How do I know if I qualify for a first-time homebuyer grant?

    Each first-time home buyer grant has set eligibility criteria. You can visit the government or provincial website to see if you meet the eligibility criteria for the grants and programs you are interested in.

    Do I need to repay a first-time homebuyer grant?

    No, except for the HBP, which is like a loan to yourself and will need to be repaid into your RRSPs within 17 years after the year of withdrawal. The first-time homebuyer grants are all designed to help offset the initial cost of homeownership and do not need to be repaid.

    I’m not a first-time homebuyer; am I still eligible for any programs?

    You may still be eligible for some of these grants and programs, as the criteria determining if you are considered a first-time homebuyer differs based on the program. Check each program’s federal or provincial government websites and the eligibility criteria to determine if you qualify.

    Final Thoughts

    Buying a home for the first time can be intimidating, but with the proper insight into the available resources, it can be much easier than you think. The Canadian government has many programs and grants designed to help make homeownership more accessible and affordable for first-time buyers. 

    By exploring these programs, you can find the financial support you need to make your first home buying experience more manageable financially and less stressful. Don’t be afraid to take advantage of Canada’s first-time homebuyer grants and incentives and start your journey toward becoming a homeowner today!

    Ready to get started?

    In just a few clicks, you can see our current rates. Then apply for your mortgage online in minutes!

    in this series First-Time Home Buyer Guide

    Best Mortgage Rates


    0.00%3 Year Fixed

    Get Rates

    0.00%5 Year Fixed

    Get Rates
    Check more rates