Federal Government Moving Ahead with 30-Year Mortgages for First-Time Homebuyers
Toronto, Ontario – In a bold move aimed at addressing the housing crisis and fostering generational equity, the federal government has announced a series of transformative measures in Budget 2024. Chief among these is the introduction of up to 30-year mortgage amortizations for first-time homebuyers purchasing new builds, effective August 1, 2024.
Housing and Economic Initiatives
The government has laid out an ambitious plan to build nearly 4 million new homes, a crucial step in tackling Canada’s housing shortage. This is part of a broader strategy to expand the social safety net, making life more affordable for Canadians and ensuring access to essential care services.
Tax Fairness to Fund Housing Investments
To support these significant investments, the government is increasing capital gains taxes on the wealthiest 0.13% of Canadians. This move is designed to generate the necessary funds while promoting tax fairness and ensuring that the most affluent contribute their fair share to the country’s prosperity.
We’re restoring generational fairness by making it easier to enter the housing market for younger Canadians. 30-year mortgage amortizations for first-time home buyers purchasing new builds will mean lower monthly payments and encourage more supply.https://t.co/cJRVdEYrrb pic.twitter.com/dYETLy2Ocp
— Chrystia Freeland (@cafreeland) June 11, 2024
Enhancing Renters’ Rights and Pathways to Homeownership
A new Canadian Renters’ Bill of Rights is set to protect renters from unfair practices, simplify lease agreements, and enhance price transparency. Additionally, the government is working with banks, fintechs, and credit bureaus to enable renters to report on-time rent payments, thereby improving their credit scores and easing their transition to homeownership.
Key Support for First-Time Homebuyers
Starting in August, the Canadian Mortgage Charter will allow up to 30-year mortgage amortizations for first-time buyers of new builds. This extension aims to make monthly mortgage payments more manageable, providing younger Canadians with a viable path to homeownership. The government will release a technical backgrounder detailing eligibility parameters to guide lenders in offering these extended mortgages.
Furthermore, the Tax-Free First Home Savings Account will continue to support Canadians in saving for down payments more efficiently. Combined with the ability to build credit through timely rent payments, these initiatives are designed to make homeownership more accessible.
Building a Fairer Canada
Deputy Prime Minister and Minister of Finance, Chrystia Freeland, emphasized the government’s commitment to creating a fairer Canada. “Canadians work hard to be able to afford a home, but the costs of a down payment and a high monthly mortgage payment put homeownership out of reach for too many people, especially Millennials and Gen Z, ” said Freeland. “By extending mortgage amortizations to 30 years for first-time buyers on new builds, we are helping generational fairness in the housing market for younger Canadians.”
Budget 2024 represents a comprehensive effort to address housing affordability, protect renters, and support first-time homebuyers. The introduction of 30-year mortgages on new builds is a significant step towards making homeownership a reality for more young Canadians, while ensuring economic growth and fairness for all generations.
As the GTA continues to grapple with housing challenges, these federal initiatives offer a glimmer of hope and a concrete path forward for prospective homeowners.
GTA Today will continue to provide updates and insights on how these new policies impact our community. Stay tuned for more in-depth coverage and expert analysis.
