First Time Home Buyers Incentive

By Odane Harding •  Updated: 09/20/22 •  6 min read

For many people, buying a first home is the most significant purchase they will ever make.

It’s a considerable investment and a big decision for first-time home buyers.

There are many things to consider when buying a home for the first time, but it doesn’t have to be overwhelming.

You can make the process exciting and enjoyable with careful planning and a little research.

Here are a few things to remember as you search for the perfect home.

Federal Government Programs Obtaining First-Time Home Buyer Mortgage

To make homeownership more affordable across Canada, the Government of Canada provides eligible buyers with incentives of 5% or 10% of the home’s purchase price as a minimum down payment.

This government program creates a shared equity mortgage proponent incentivizing new home buyers by contributing to reduced monthly mortgage payments.

You may hear the name First-Time Home Buyer Incentive, also referred to as Shared Equity Mortgage (SEM), meaning the same thing but with two different names.

In this plan, the government shares joint ownership of the house. Since it’s an intricate system, be cautious to research if it’s appropriate for you.


The incentive’s benefit creates a larger down payment, further reducing the monthly mortgage payments and helping first-time buyers need fewer upfront savings.


Available To Eligible First-Time Homebuyers To:

You Are Considered A First-Time Homebuyer When:

Incentive Eligibility Requirements

To be eligible for the shared equity mortgage, you must meet the following criteria:


Repayment Requirements

You will need to repay the incentive within a 25-year maximum period since you have owned the home or if you decide to sell the home, whichever comes first.

Repayment of a home that has increased in value since the purchase date:

Repayment of a home that has decreased in value since the purchase date:

The Homebuyer’s Plan (HBP) Using Your RRSP Tax-Free Withdrawal

When buying a first home, there are many things to consider.

One of the most significant considerations is how you will finance your purchase.

If you are a first-time homebuyer in Canada, you may be eligible for the Home Buyers’ Plan (HBP).

The Homebuyers Plan (HBP) program allows you to withdraw up to $35,000 from your Registered Retirement Savings Plan (RRSP) tax-free to buy your first home.

Tax Credits Applicable To Home Buying

Federal Programs

The Government of Canada offers The Home Buyers Amount and GST/HST Housing Rebates to homebuyers as incentives.

The Home Buyers Amount (2021 And Prior Years):

The Home Buyers Tax Credit (HBTC) (Starting 2022 And Future Years):

GST/HST Housing Rebates:

Provincial Programs

The Ontario Government provides an Ontario Land Transfer Tax Rebate incentive for first-time eligible homebuyers.

Ontario Land Transfer Tax Rebate (Maximum $4000):

When you purchase an interest in land or property in Ontario, you pay a land transfer tax.

Eligible homebuyers may qualify for a refund or portion of this tax.

First-Time homebuyers acquiring property valued at more than $368,000 may qualify for up to a maximum rebate of $4000.

Municipal Programs

1.Government of Canada National Housing StrategyFirst-Time Home Buyers Incentive
2.Government of CanadaWhat Is The Home Buyers Plan (HBP)?
3.Government of CanadaBuying Your First Home

Odane Harding

Odane Harding is a Toronto Real Estate Agent who specializes in helping new buyers and sellers of homes. With over 6 years of experience in the industry, Odane brings his knowledge and expertise to each client, ensuring they have a smooth transaction. His passion for helping people and his dedication to providing excellent service makes him stand out amongst other agents. Call Odane today to get a free consultation with your next new home purchase or sale.