Wow, A New House
Interest rates may continue to rise, in an effort to curb inflation, and it seems to be helping. Costs have risen dramatically, and I cannot help but feel sad for the individuals who want to enter the housing market for the first time.
Over the years, governments have taken away options, but help us with our financial burdens. They have brought in RRSPs, TFSAs, RESPs, and finally a home buying incentive has hit the market.
The Home Buyers' Plan (HBP), is a program that allows you to withdraw funds from your RRSP to buy or build a qualifying home for yourself, or for a related person with a disability. The HBP allows you to pay back the withdrawn funds, within a 15-year period.
You can withdraw funds from more than one RRSP as long as you are the owner of each RRSP account. Your RRSP issuer will not withhold tax on withdrawn amounts of $35,000 or less.
Want more incentives? Ontario also offers a down payment assistance program, targeted to help first-time homebuyers get into the property market. Under the program, eligible homebuyers may receive up to 10% of the cost of a new home or condominium as a loan, which can be used toward making the down payment.
First-time homebuyers will also benefit from a significant reduction in the land transfer tax, which will save eligible buyers up to $4,000 on their first home purchase. These savings will help to offset the cost of buying a home in today's competitive market.
These measures are of course, part of the government’s broader effort to support economic growth across the province. Big Brother hopes these measures will stimulate the construction industry and create new jobs. Also adding to other home-related services, such as landscaping and interior design, which could boost the small business sector.
No doubt there will be some controversy to these plans, but for first time buyers, every dollar counts. I think back to when RRSPs were first instituted, and how many of us are so grateful for the small amounts, which over time certainly grew.
Jonathan van Bilsen is a television host, award winning photographer, published author, columnist and keynote speaker. Watch his show, ‘Jonathan van Bilsen’s photosNtravel’, on RogersTV, the Standard Website or YouTube.