In a red-hot real estate market, a little help with the down payment on a home can go a long way—especially when you’re a first-time buyer without the advantage of equity in an existing property. So when the Canadian federal government decided, in 2019, to begin offering first-time home buyers down payment assistance under the First-Time Home Buyer Incentive (FTHBI), it seemed eligible buyers were in for a bargain.
Before you begin a Whatsapp chat with your real estate agent and start browsing available listings, there are a few things you should know about the FTHBI. First, not everyone qualifies, since the program is limited to a specific subset of first-time homebuyers. Second, the incentive is not free money, but a form of loan from the Government of Canada which will eventually need to be paid back, possibly at a large premium.
We break down the specifics of the FTHBI, how accessible it is and, most importantly, the potential pitfalls you should know about.
Who’s eligible for the First-Time Home Buyer Incentive?
For the FTHBI, “first-time home buyers” are not only those who have never owned a home before, but it can also include previous homeowners who have gone through a divorce or breakdown of a common-law partnership, or people who have not lived in a home that they owned (or that was owned by their spouse or common-law partner) for the past four years.
To be eligible for the program, however, you also need to meet the following criteria: