While the government tries to help they seem to get in their own way. Here is their most recent proposal, while it helps a few people we feel it does not reach the masses of first-time buyers that need support.
If you're planning to buy a new home in Canada in 2024, you'll be happy to know that the government has recently announced two new mortgage changes that will assist first-time buyers.
Starting from August 1, individuals with newly constructed home purchases will be able to enjoy extended 30-year amortization on insured mortgages. This means that people with less than 20% down payment, which is most common for first-time homebuyers, can benefit from lower monthly mortgage payments. However, it's essential to keep in mind that the 25-year amortization will allow you to save on interest and save in the long run. Another benefit of this longer amortization is that this allows first-time home buyers to be able to purchase a home for 9% more. Therefore, if you're struggling to qualify for a mortgage, it's best to contact one of Browne Mortgage's advisors to see if the 30-year amortization mortgage is a good fit for you.
Example:
$500 K Mortgage on a newly constructed home purchase with 5% Down
25-year am Payment - Monthly Payment of $ 2,800.45
30 year am Payment - Monthly Payment of $ 2,461.78
*Using today's Insured Premium Rate of 4.74% subject to change
Starting from April 16, individuals will also be able to access more money for purchases through the RRSP, increasing the limit from $35,000 to $60,000. The repayment of the RRSPs will also increase from 2 years to 5 years. This aims to make homeownership more feasible for Canadians.
With the government having phased out the First-Time Home Buyer Incentive learning about these new options is beneficial for people looking to purchase a new home soon. Canadian homebuyers can look forward to a more accessible and affordable housing landscape in 2024. Stay informed while you navigate these developments to secure your dream home. For personalized advice, don't hesitate to reach out to us today.