Subsidies and incentives for first-time home buyers in Quebec in 2024 

Are you finally ready to embark on your project to buy your first home in Quebec? Before you go any further, make sure you’re aware of all the tools the federal and provincial governments have at your disposal to ease the burden of this expense on your personal finances.

At Vistoo, Canada’s new home platform, we’re here to help you make the most of the various subsidies and incentives available to you when you become a homeowner.

Let’s take a closer look at what you can get from the various public bodies. This information will come in handy, especially if you’re in the process of buying your first home.

Subsidies for a first-time buyer

There are a number of incentives and programs that can help you become a homeowner. Some of these are of particular interest to first-time homebuyers.

Certain provinces, territories and municipalities in Canada offer subsidies for first-time home buyers. Several Quebec cities offer assistance programs for first-time buyers.

These are essentially very useful tools and It’s important to check whether you’re eligible, as these subsidies could well reduce the price of your first property.

What’s more, even if you owned a home in the past, some of these programs may still be available to you, depending on your circumstances.

The CMHC subsidy

The Canada Mortgage and Housing Corporation, also known as CMHC, offers an incentive for first-time homebuyers.

This incentive, which is supported by the Canadian government, provides a mortgage loan equivalent to either 5% or 10% of the value of the property you wish to purchase. 

The majority of loans granted under this program are 5%, but a 10% loan is available for the purchase of a new home anywhere in Canada.

When you benefit from this subsidy, you agree to repay, after 25 years or upon the sale of the property, an amount based on the market value of the property you purchased. This amount is equal to the percentage you benefited from when the purchase was first made.

For example, if you benefited from a 5% subsidy, you’ll have to repay 5% of the property’s market value at the end of the 25-year term, or when that home is sold.

This 5% may be higher or lower than the initial loan, depending on fluctuations in the property’s value.

Finally, a number of conditions apply for eligibility, the most important of which are :

• Total annual income of buyers must not exceed $120,000;
• The total loan cannot exceed an amount equal to 4 times your qualifying income;
• You or your partner is a first-time homeowner.

Don’t hesitate to find out more about this subsidy if you’re in the process of buying your first home, especially if you’re looking for a new home for sale, as this is the best way to fully benefit from it.

 The Home Buyers’ Plan (HBP)

The HBP is a program that lets you buy a home by withdrawing funds from your RRSP to make a downpayment.

This plan offers a number of advantages to first-time buyers:

• Funds withdrawn in this way for the purchase of a first home are tax-free;
• For this purchase, you can withdraw up to $35,000, or even $70,000 if you’re a couple;
• Repayment is then made over 15 years, interest-free;
• And much more!

For this program, you can not have lived in a property owned by you or your spouse in the last four years.

The exception is divorced or separated people who, as of 2020, are eligible to take advantage of this plan again, provided their first withdrawal has been repaid in full.

Federal and provincial tax credits

Both the Quebec and Canadian governments offer tax credits for first-time buyers.

Like the HBP, if you haven’t lived in a home you or your spouse owned in the past four years, you may be able to reduce your taxes in the year of purchase.

In Quebec, the maximum amount of this tax credit is $1,500, which is shared among eligible buyers who have purchased a first home.

At the federal level, the First-Time Homebuyers’ Tax Credit is essentially designed to offset the costs (closing costs) inherent in the purchase of a first home. 

Since you are a first-time homebuyer, this subsidy allows you to deduct up to $10,000 from your income tax return, resulting in a refund of $1,500. You claim this credit in the same year you purchased your property. The first-time homebuyers’ tax credit pays off for homebuyers.

What’s more, several provinces, including Quebec, offer a total or partial refund, depending on certain criteria, of taxes on the purchase of a new home or major renovations of an existing home.

It is yet another excellent reason to shop for a new home in Quebec’s real estate market.

For future buyers: the CELIAPP

If you’re planning to buy a home in the next few years, a new savings plan came into being in 2023 to help you save for that important purchase.

For 2024, the First Home Savings Account, or FHSA, is a new savings account that allows you to save up to $40,000 toward the purchase of your first home.

For example, “if you contribute $8,000 a year to your FHSA for five years, you’ll reach the maximum contribution” of $40,000. This tax grant is good for 15 years.

Like the RRSP, it allows you to contribute while reducing your taxable income, and like the TFSA, the profits generated by your investments are not taxable.

If you use the funds to buy your first home, withdrawals from this account will be tax-free.

Finally, it can be combined with the Home Buyers’ Plan (maximum $35,000) and other home ownership grants and incentives.

If you’re interested in this savings plan, it’s currently available at any financial institution that offers TFSA registration.

To find the real estate project or new home of your dreams, there’s no better tool than our interactive map to discover all our real estate listings.

So whether you’re looking for a home in Brossard, in the heart of Montreal or anywhere else in the province, you’ll find what you’re looking for with Vistoo: contact us today, and a team of experts will answer all your questions.