NEWS

The Federal Government's First-Time Home Buyers' Incentive Program (FTHBIP) was first launched September 2, 2019 and was designed to lower a qualifying buyer's monthly mortgage payments by increasing the available down payment through a shared benefit between the buyer and the government. The government would then participate in the share of the appreciation or the depreciation of the property.

As announced by the Government of Canada in its Budget 2022 Plan, the government would introduce appreciation and depreciation limits within the program. On June 1, 2022 it did exactly that. An appreciation and depreciation cap is now in effect. The “8% Cap” is now in effect and this cap limits its share in either the appreciation or the depreciation of a home at the time of FTHBIP repayment.

The Canadian Mortgage and Housing Corporation (CMHC) has explained that the share limit (Cap) will be up to a maximum of 8% of the home value gain or loss from the time of the advance to the time of repayment and it will not be compounded.

If there is an appreciation, then the 8% will be retroactive to the implementation date of the program (September 2, 2019) but in the case of depreciation, the incentive repayment is calculated on or after the June 1, 2022 effective date.

If you purchased your home under this program, it is highly recommended that you read further and understand these changes and how they may affect you moving forward. For further information and explanations, please refer to the link below:

First-Time Home Buyer Incentive Program Updates