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Program
First-time home buyers may be eligible for a 15 per-cent income tax credit for closing costs.

Details

To assist first-time home buyers with the costs related to the purchase of a home.

The First-Time Home Buyers' Credit (FTHBC) provides a 15 percent credit on a maximum of $5,000 of home purchase costs (e.g. legal fees, land transfer taxes, etc.), meaning maximum tax relief of $750.

Applicable to first-time buyers purchasing a home closing after January 27, 2009.

The FTHBC is claimable for the taxation year in which the home is acquired.

An individual will be considered a first-time home buyer if neither the individual nor the individual's spouse or common-law partner owned and lived in another home in the calendar year of the home purchase or in any of the four preceding calendar years.

Source: Toronto Real Estate Board

Program
The Home Buyers' Plan (HBP) is a program under which you can, generally, withdraw up to $25,000 from your registered retirement savings plan (RRSPs) to buy or build a qualifying home.

Details

Up to $25,000 per person could be withdrawn tax-free from RRSPs to buy or build a principal residence.

You have to meet the first-time buyer's condition. You are not considered a first-time home buyer if you or your spouse owned a home that you occupied as your principal place of residence in the past 5 years. To determine past 5 years, the 4 years preceding the year you make your withdrawal plus the period in the year you make your withdrawal ending 31 days before your withdrawal is the rule adopted

Home buyers withdrawing funds do not have to pay income tax on the amount withdrawn, as long as the funds are repaid into an RRSP in the future.

The 15-year repayment period will begin in the second calendar year following the calendar year in which the withdrawal is made. In addition, a qualifying home must generally be acquired before October 1 of the calendar year following the year of withdrawal.

A special rule denies a tax deduction for contributions to an RRSP that are withdrawn within 90 days of the RRSP deposit being made. Consequently, to get the normal tax break for a contribution and to use those funds under the plan, the money must be in your RRSP for at least 90 days before a withdrawal is made.

Source: Toronto Real Estate Board

Program
With as little as five per cent down payment, from personal or other sources (see below for eligible other sources), all home buyers have access to mortgage insurance enabling them to enter the housing market, as long as they can meet the standards for a five year fixed-rate mortgage.

Details

Mortgage insurance for 95 per cent mortgages is available to both first time and repeat home buyers.

Buyers using the Program may consume up to 39 per cent of their gross monthly household income for payments of principal interest, property taxes and heating, and total debt load cannot exceed 44 per cent of monthly household income.

Buyers using the Program must be able to qualify for a five year fixed-rate mortgage even if they choose a mortgage with a lower interest rate and shorter term.

Insurance premiums on loans for 95 per cent of the lending value of the house where the five percent down payment comes from personal sources will be 2.75 per cent of the mortgage loan. Insurance premiums on loans for 95 per cent of the lending value of the house where the five percent down payment comes from other sources will be 2.9 per cent of the mortgage loan. This premium can be added to the mortgage.

Borrowers are required to demonstrate, at the time of application, their ability to cover closing costs equal to at least 1.5% of the purchase price.

Where the minimum equity requirement is being met by way of a financial gift, the funds must be in possession of the borrower 15 days before making an offer to purchase.

For homeowners who used the Program to purchase their home, the maximum amount that can be withdrawn if re-financing their mortgage is 80 per cent of the value of their home.

The Five Per Cent Down Payment Program is not available for non-owner occupied properties. These properties require a minimum down payment of 20 per cent.

Government-backed insured mortgages are not available for homes with a purchase price of $1 million or more.

Effective July 9, 2012, the maximum allowed amortization period for mortgages with less than 20 percent down payment is 25 years.

Source: Toronto Real Estate Board

Program
You may be eligible to claim a rebate for a part of the HST you pay on the purchase price of a newly constructed home or the cost of building your home if:

you buy a new or substantially renovated home (including the land or if you lease the land) from a builder;

you buy a new mobile home (including a modular home) or a floating home from a builder or vendor;

you buy a share of capital stock of a co-operative housing corporation;

you construct or substantially renovate your own home, or carry out a major addition (or hire another person to do so); or

your home is destroyed in a fire and is subsequently rebuilt.

Details

The purchase price of resale homes are exempt from the HST. The purchase price of newly constructed homes are subject to HST.

New home buyers can apply for a 36% rebate of the federal portion of HST applicable to the purchase price to a maximum of $6,300 for homes costing $350,000 or less. For new homes priced between $350,000 and $450,000, the rebate on the federal portion of the HST rebate would be reduced proportionately. New homes priced $450,000 or higher would not receive a rebate of the federal portion of the HST.

New home buyers can apply for a 75% rebate of the provincial portion of the HST applicable to the purchase price to a maximum of $24,000.

Source: Toronto Real Estate Board