Greetings,
I hope you are well. I will do my best to outline succinctly some of the recent changes for all real estate market participants.
BUYER UPDATES:
Beginning with our most oppressive and loathed tax:
The Property Transfer Tax (PTT)- First-Time Home Buyer Exemption Limit - $835,000 (First $500,000 is exempt; therefore, the rebate is discounted by $8,000 if over $500,000) - Sliding Scale on the discount amount from $835,000 up to $860,000. https://wowa.ca/calculators/land-transfer-tax
Example:
Purchase Price of $550,000
PTT = 1% on the first $200,000 + 2% on the balance = $2,000 + $7,000 = $9,000 PTT (-) $8,000 discount = $1,000 payable in PTT.
Purchase Price of $800,000 PTT = 1% on the first $200,000 + 2% on the balance = $2,000 + $12,000 = $14,000 PTT (-) $8,000 discount = $6,000 payable in PTT.
Purchase Price of $850,000
PTT = 1% on the first $200,000 + 2% on the balance = $2,000 + $13,000 = $15,000 PTT (-) $3,200 discount = $11,800 payable in PTT.
Newly Built Exemption- $1,100,000 and scales up to $1,150,000 (saves you $20,000 in PTT)
NOTE: PTT must be paid in cash at closing—it can't be added to the mortgage unless you make a smaller down payment.
30-Year Amortizations : Available to First-Time Home Buyers and New Build Purchases
• First-time homebuyers can now access 30-year amortizations for insured (less than 20% down) mortgages. This increases the amount you qualify for and potentially allows for a lower monthly payment.
• 30-Year Amortization for New Builds - Technically, this took effect on August 1, 2024, and is available to everyone, not just first-time homebuyers.
Price Cap Increase for Insured Mortgages
• The price cap (purchase price) for insured(less than 20% down) mortgages has been raised from $999,999 to $1,499,999
The Fine Print:
Down payment - Great news, minimum requirements stay the same:
• 5% on the portion up to $500,000
• 10% on the portion between $500,000 and $1.5 million
Example:
Purchase Price of $800,000
5% on the first $500,000 = $25,000 (+) 10% on the balance ($300,000) = $30,000 $25,000 + $30,000 = $55,000 required down payment
Purchase Price of $1,499,999
5% on the first $500,000 = $25,000
(+) 10% on the balance ($999,999) = $99,999
$25,000 + $99,999 = $124,999 required down payment
* Previously, the down payment on a $1.5 million home for a FTHB was $300,000. FTHB's can now get into that same home with $125,000. This will undoubtedly take some pressure off the Bank of Mom and Dad.
Handy Mortgage/Affordability/Debt Service Calculators
Key takeaways
• As of December 15th, 2024, mortgage amortizations of 30 years will be available for all first-time home buyers, and for any new construction purchase.
• The maximum purchase price for an insured mortgage will also increase to $1.5 million from the current $1 million.
• Combined, these are some of the most impactful affordability measures introduced for first-time home buyers seen in decades.
Please get in touch with me with any questions about the aforesaid indexed items or the current real estate market conditions.
Best, Arran
Are you looking to buy or sell a home?
Please call me at 250-884-3980, and I can give you the expert guidance and help you need to make informed decisions and achieve your housing goals.
First-Time Home Buyer?? Call me at 250-884-3980 to chat about the ZERO-DOWN FINANCING OPPORTUNITY! *Some exceptions apply*
Earn up to $2,500 if you refer someone who is looking for real estate services~
|
