Buying Your First Home in Ontario: The Oakville Real Estate Market
Buying your first home in Ontario can be such an overwhelming experience. You have to put a number of factors in mind, from engaging the right realtor to finding the right home that suits you and your family. However, being a first homebuyer comes with some advantages.
Buying Your First Home in Ontario
One of the biggest obstacles when it comes to buying a house is coming up with the down payment. Even saving every month may not be enough to pay up a considerable down payment to allow you to get the house of your dreams. The good news is that there are a number of grants and programs that can provide the financial assistance you need.
National and Local Assistance
The programs you can access come in two forms: local and national. Local assistance programs and grants are provided by the city while the government offers the national programs. Let us look at these programs.
The Home Buyers' Plan
This is an arrangement that allows you to take money from your Registered Retirement Savings Plan (RRSP) to use towards buying your new home. The plan enables you to take $25,000 from the account each year depending on your needs. If you are a couple, you are entitled to a limit of $50,000.
After you take the cash, you get to repay it within a period of 15 years. In this case, you pay $(25,000/15) = $1666.67 per year if you are single and double the amount if you are applying as a couple.
What if you default on the annual payment? Well, the difference will have to be deducted from your salary. This amount attracts tax.
For you to qualify for this plan, you shouldn't have owned any property in the past 4 years. Just a caution, remember that you are taking cash from your pension funds. This means you need to try to pay it back in full.
Home Buyers Land Tax Credit
This is one of the city-managed programs in Ontario. As a first homebuyer, you are entitled to claim a maximum of $2,000 on a home that costs a maximum of $227,500. This eliminates the need for you to pay the necessary land transfer fees.
For you to be eligible for the credit, you need to have never owned a piece of land anywhere previously. However, you can still claim 50% of the tax credit in case you have children.
Home Buyer Tax Credit (HBTC)
This is a program offered by the Government. This program gives you a maximum of $750 if you qualify. To apply for the credit, you need to fill out line 369 on your personal tax return form. However, you can only qualify if you meet the following criteria:
- You and your partner have acquired a qualifying house during the past tax year.
- If you and your partner haven't owned a home before acquiring the new one.
If you qualify, you can claim the credit. Either you or your partner may claim the credit individually or you can share it between the two of you. Whatever the case, the total credit shouldn't surpass the $750 limit. There is another catch though: after you purchase your home, you need to occupy it and make it your main residence within 12 months of purchasing it.
A Quick Fact
Buying your first home in Ontario is one of the best investments for anyone. A home represents a place where you can relax and create nostalgic memories with your loved ones. This is why it is exciting to buy your first home. However, making the down payment is normally a hassle. Nevertheless, with various grants and programs from the local and national authorities, you have a chance to make your dream come true.