Guide for first time home buyers in BC:


In another province?

For Alberta click here. | For Ontario click here.


So, you’re buying your first home. Super exciting stuff. As a first time home buyer, there are a lot of exciting steps you’ll be taking – getting pre-qualified, finding a great realtor to work with, getting your financing in order, and finally getting the mortgage approved. (then poppin’ bottles!).

Buying a home = lots of numbers. Especially as a first timer. Down payment amount, credit score, household income, property transfer tax, GST...the list goes on.

We know it can be a lot. So, we’re here to lighten the (mental) load, and help you be prepared.

Down Payment cheat sheet

• If you’re using your RRSP for a down payment, you can withdraw up to $25,000, and you need to begin to repay your RRSP two years after you’ve withdrawn the money. You’ll have 15 years to repay the funds.

• BC just introduced the first time home buyers loan to help homeowners with their first down payment. The provincial government will match up to $37,500 or up to 5% of the home’s purchase price. The 25-year loan is interest-free and payment-free for the first 5 years.

• If you’re purchasing a home under 500K, your down payment needs to be at least 5%

• If you’re purchasing a home that’s more than $500,000 and less than $1 million the minimum down payment is 5% on the first $500,000 plus 10% of the remaining balance

• If you’re purchasing a home that’s $1 million or more, the minimum down payment is 20%

Property Transfer Tax

If you’re a first time home buyer, there are some really sweet tax benefits you can take advantage of when you’re buying a home. They’re different for every province, and they can be a little confusing, so we’re breaking it down for you.

You have to pay property transfer tax in BC, and it’s due when you’re closing the mortgage.

Property tax amounts:

• 1% on the first $200,000 of the house price

• 2% on more than $200,000 and up to and including $2,000,000

• 3% on anything more than $2,000,000

The First Time Home Buyer’s Program basically reduces or eliminates the amount of Property Transfer Tax you pay when you buy your first home. Which, we know you care about, since buying a home is a big investment (congrats, btw!).


Sweet. How does it work/What’s in it for me?

If your property is less than $475,000 you don’t have to pay the tax. Score! You just have to make sure you meet the requirements below.

If your home is between $450K and $500K you may qualify for a partial exemption.

On to the nitty gritty.


To qualify for the full exemption…

You must be:

• A Canadian citizen or permanent resident Have never received a first time home buyers exemption or refund

• Have lived in B.C. for a year (12 consecutive months) immediately before the date you register the property or filed at least 2 income tax returns as a B.C. resident in the last 6 years

• Never have owned a home (that you lived in as your main residence) anywhere in the world at any time

The home you’re buying must be:

• Located in BC

• Only be used as your principal residence

• Less Be 1.24 acres or smaller


You may qualify for the partial exemption if the property...

• Is larger than 1.24 acres

• Has another building on the property other than the principal residence

Here’s a handy little chart that can help you figure out how much you qualify for.

Also, important to note: If one or more of the people purchasing the home don’t qualify, only the percentage of interest that the first time homebuyer's have in the property is eligible.

For example/ If you (the FTHB) owns 60% of the property, 60% of the tax amount is eligible for the exemption.


Pro tip: If one person has already used their FTHB exemption, you can register the property, in the person who hasn’t used theirs at 99% and the other at 1%

There’s also a new exemption on property transfer tax for any newly built homes in BC…

Newly Built Home Exemption

How does it work/What’s in it for me?

• If your property is newly built and is less than $750,000 you don’t have to pay the property transfer tax.

• If your home is between $750K and $800K you may qualify for a partial exemption.

You must be:

• A Canadian citizen or permanent resident

• A newly built home

• Located in BC

• Only be used as your principal residence


To qualify for the full exemption...

The home you’re buying must be:

• Be 1.24 acres or smaller


You may qualify for the partial exemption if the property is…

• Is larger than 1.24 acres • Has another building on the property other than the principal residence

GST

Good news - you ONLY pay GST (5% which is normally added to your purchase price) if you’re buying a newly built home from a builder. (for example, you bought a pre-sale condo.)

But…If you fall into the category of buying a brand new place, there’s a potential partial exemption on the GST.

Here’s the deal.

If your new home is priced below $450,000 before GST/HST, you may be eligible for a partial rebate of the 5% GST portion. The GST/HST New Housing Rebate amount changes on a sliding scale, depending on the purchase price of your home. For example, if it was priced at $350,000 or less, your GST might be reduced to just 3.5%.

The only catch – the home must be your primary residence.


Phew! We know that’s a whole lot of info. Don’t worry you don’t have to memorize the above, we’re going to be here along the way to help you with all the details. And, if you’re still have questions, concerns, just feel like chatting, our Mortgage Specialists know the ins and outs and are here to help. You can Live Chat with them, or shoot them an email here.

Ready to apply for that mortgage? (exciting!)


The information provided in this blog is for information purposes only, you should consult a mortgage professional for more detailed information. E. & O. E.
Ontario MogoMortgage is offered by Mogo Mortgage Technology Inc. o/a MogoMortgage (Ontario: FSCO License No. 12836)
British Columbia MogoMortgage is offered by Mogo Mortgage Technology Inc. o/a MogoMortgage.
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