According to a 2016 report, over 9.5m of the 14.1m households in the country owned a home in 2016, i.e: a rate of 67.8 percent.

While we don’t have the latest numbers, it’s believed that the rate hasn’t changed much considering it was 69 percent in 2011 and 68.4 percent in 2006.

The government, however, is taking steps to push more people to own a home. One such step is the First Time Home Buyer Incentive.

In this article, more about this initiative and what it entails.

A government incentive that makes ownership easier for first time home buyers

Launched on September 2, 2019, the program makes it easy for first-time buyers to purchase a home by offering up to 10% of the home's purchase value to use as a down payment. This helps lower the mortgage making ownership easier and more affordable.

The best thing about this program is how it protects you against decreases in price. The government body shares or contributes in the downside and upside of the value.

The amount of the incentive can be between 5 percent and 10 percent depending on several factors including the type of property you intend to buy.

  • Existing Home:            5%
  • Newly Constructed Home: 5% or 10%
  • Mobile home (old or new): 5%

Residential properties can contain up to 4 units. These include:

  • Family homes (single)
  • Triplex
  • Duplex
  • Single homes
  • Fourplex
  • Mobile homes
  • Condominiums
  • Townhouses

It's a shared-equity program that lowers your monthly mortgage payments. Here is how it Works:

This shared equity mortgage plan is quite simple to understand. You purchase a home that’s valued $300,000. You receive a 10 percent incentive of the price which equals $30,000.

  • The home increases in value and the new price is $350,000. Since your rate was 10%, your payback would be $35,000.

  • The home decreases in value and the new price is $250,000. Since your rate was 10%, your payback would be $25,000.

Are you Eligible for the first time home buyer incentive? What home can qualify for the Program?

The program is for first-time buyers, i.e: individuals who do not already own a home.

Here are the conditions:

  • You do not currently own a home and you’ve never purchased one before
  • You didn’t occupy a property that you, your common-law partner, or spouse owned in the last four years.
  • You’ve recently separated from your partner. This one applies even if you do not meet the requirements mentioned above.
  • Your annual qualifying income is under $120,000.
  • The total borrowing amount is under 4x your qualifying income.
  • You hold Canadian citizenship, permanent residency, or the right to work in the country.
  • You have enough funds to make a downpayment (minimum) with traditional options such as savings and withdrawals.

The Incentive can be considered a second mortgage. Your first mortgage has to meet certain requirements, i.e: it must be more than 80 percent of the property’s value. It’s subject to a mortgage loan insurance premium and must be eligible through CMHC, Genworth, or  Canada Guaranty.

Some other requirements include:

  • The property must be in Canada
  • It must be suitable for year-round, full-time occupancy
  • You intend to live in the house

There Are Some Exemptions and Exclusions

Not all first-time homebuyers qualify. Only applicants who meet the minimum down payment requirements are eligible. It is 5% of the first $500,000, and 10% for any additional amount.

Moreover, you must have a combined household income of at least $120,000. Also, the incentive amount and the mortgage value must not exceed 4x your household income.

Originally capped at just $480,000, the threshold was pushed to $789,000 in Victoria, Toronto, and Vancouver.

These terms and conditions mean the program may not be suitable for all markets.

Eastern Canada, the Prairies, Quebec, and some urban centers in Ontario were identified as potential markets according to this report. Houses in cities might be out of reach considering the average house in Toronto costs $870,000.

How Much Can You Save on Your Mortgage Payment?

Buyers can save up to $286 per month in mortgage payments on a home worth $500,000, according to government estimates.

“People who may sell or move before their five-year mortgage term is up will likely save money with the FTHBI” suggests Rob McLister, a mortgage expert.

Also, we must mention that like any other loan, this one has to be paid back as well – within 25 years or once the home gets sold, whichever happens first.

The First Time Home Buyer Incentive and the Provinces: Where to find a home that qualifies to the program in each province?

Since prices differ from state to state, having a look at the real estate condition in each market can help you understand where you can find a qualifying home:


Prices in Alberta appear to be falling down. The average house costs $353,000. Hence, you will have no difficulty in finding a First Time Home Buyer Incentive qualifying property in Alberta.

British Columbia

Prices in British Columbia appear to be increasing rapidly. In fact, they’ve grown by about 7 percent in the last year mainly due to investment from abroad. This is why the residents are pushing for the government to prevent foreign ownership of property in the region.

The average house costs $736,000, which can make it difficult to find a First Time Home Buyer Incentive qualifying property in British Columbia.


Ontario is one of the most expensive provinces in Canada, but surprisingly the average house only costs $450,000 here. Hence, you will have no difficulty in finding a First Time Home Buyer Incentive Ontario qualifying property here.

Some popular cities, however, might be out of range. Toronto, for example, can be a difficult nut to crack as the average price here is $930,000. It can be difficult to find a First Time Home Buyer Incentive Toronto house, you can, however, look at other cities in Ontario.


The average house in Quebec costs $340,000 only. While the prices have increased in the last few years, most homes in the province still qualify for the First Time Home Buyer Incentive Quebec program.

The province isn’t very popular among homeowners and the average price is less than $280,000. This is why the local government is helping the locals.

For the other states, it’s easy to find a home qualifying for the First Time Home Buyer Incentive program as they are not very hot markets for houses.

Buying a home is a big decision. Make sure to see all your options before you finalize a deal. Letting your agent know that you intend to take advantage of the program will help save time as he or she will only show you qualifying properties.

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