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Top 5 financial tips for first-time home buyers

With all the excitement and stress that comes with buying a property and getting a mortgage, there’s a lot to manage as a first-time home buyer. To help you get organized for the upcoming tax-filing season, we’ve rounded up our top 5 money-saving tips for first-time home buyers who purchased a property in 2022 in Canada.

Since April 30, 2023 falls on a Sunday this year, the deadline for filing your 2022 taxes is on or before Monday, May 1, 2023.

1. Claim your First-Time Home Buyers Tax Credit

Also called the Home Buyers’ Amount, this offers eligible homeowners a $5,000 non-refundable income tax credit on a principal residence. This translates into a $750 tax rebate back in your wallet. In order to be considered a principal residence by the Canada Revenue Agency (CRA), you must intend to move into the home within one year after purchasing.

This should not be confused with the federal government’s First-Time Home Buyer Incentive (FTHBI) program, which is a shared equity program that allows first time home buyers to borrow up to 10% of the home value towards their down payment.

2. Is your home a new build? Claim the GST/HST New Housing Rebate

If you paid a Goods and Services Tax (GST) or Harmonized Sales Tax (HST) on a new or substantially renovated house, condo or duplex, you may be eligible for this rebate.

Purchases of a previously owned property or resale property are typically tax-exempt, meaning the purchase price negotiated between the buyer and seller is not subject to an additional tax by the government (lucky you!).

3. Repayments to the RRSP Home Buyers’ Plan start the second year after you withdrew funds

If you withdrew funds through the Home Buyers’ Plan in 2022, your first year of repayment starts in 2024. You have up to 15 years to repay your RRSP. Each year, you can view your remaining balance on your notice of assessment sent by the Canada Revenue Agency.

If you purchased a property and withdrew funds from your RRSP in:

You must start making repayments to your RRSP in:

2020

2022

2021

2023
2022

2024

2023

2025

2024

2026

 

4. View monthly property value estimates with Perch

Sign up or log in to your account to track your remaining mortgage balance and view your latest property value estimates right from the dashboard. Other than being curious about what your property is worth, there are several good reasons to monitor your property value. In addition to being one of the largest assets in your financial portfolio, many homeowners plan to use real estate to fund a comfortable retirement. In terms of estate planning, you’ll want to make sure your assets are distributed fairly. If the value of your home has increased significantly over time, you’ll need to ensure you have the right amount of insurance coverage if something happens.

Thinking about doing a home renovation project? If the value of your home has increased, that will allow you to borrow against the value of your home at a favourable interest rate. See how much home equity you can access if you refinance.

5. Consider upgrades to make your property more energy efficient

The Canada Greener Homes Grant provides eligible homeowners with up to $5,000 in rebates to retrofit their principal residence. This includes rebates for replacing windows and doors, adding insulation or installing a smart thermostat or heat pump.

In order to take advantage of this grant, you must confirm your eligibility and submit an application before starting your renovation project. Make sure to thoroughly read through the program details of what’s required for your retrofits. As part of the application process, you must complete an energy audit by hiring an energy advisor that is registered with Natural Resources Canada. Keep in mind, renters or landlords looking to upgrade their investment property cannot use this program.

  • Kat
  • Last updated: September 7 2022

Top 5 financial tips for first-time home buyers

With all the excitement and stress that comes with buying a property and getting a mortgage, there’s a lot to manage as a first-time home buyer. To help you get organized for the upcoming tax-filing season, we’ve rounded up our top 5 money-saving tips for first-time home buyers who purchased a property in 2022 in Canada.

Since April 30, 2023 falls on a Sunday this year, the deadline for filing your 2022 taxes is on or before Monday, May 1, 2023.

1. Claim your First-Time Home Buyers Tax Credit

Also called the Home Buyers’ Amount, this offers eligible homeowners a $5,000 non-refundable income tax credit on a principal residence. This translates into a $750 tax rebate back in your wallet. In order to be considered a principal residence by the Canada Revenue Agency (CRA), you must intend to move into the home within one year after purchasing.

This should not be confused with the federal government’s First-Time Home Buyer Incentive (FTHBI) program, which is a shared equity program that allows first time home buyers to borrow up to 10% of the home value towards their down payment.

2. Is your home a new build? Claim the GST/HST New Housing Rebate

If you paid a Goods and Services Tax (GST) or Harmonized Sales Tax (HST) on a new or substantially renovated house, condo or duplex, you may be eligible for this rebate.

Purchases of a previously owned property or resale property are typically tax-exempt, meaning the purchase price negotiated between the buyer and seller is not subject to an additional tax by the government (lucky you!).

3. Repayments to the RRSP Home Buyers’ Plan start the second year after you withdrew funds

If you withdrew funds through the Home Buyers’ Plan in 2022, your first year of repayment starts in 2024. You have up to 15 years to repay your RRSP. Each year, you can view your remaining balance on your notice of assessment sent by the Canada Revenue Agency.

If you purchased a property and withdrew funds from your RRSP in:

You must start making repayments to your RRSP in:

2020

2022

2021

2023
2022

2024

2023

2025

2024

2026

 

4. View monthly property value estimates with Perch

Sign up or log in to your account to track your remaining mortgage balance and view your latest property value estimates right from the dashboard. Other than being curious about what your property is worth, there are several good reasons to monitor your property value. In addition to being one of the largest assets in your financial portfolio, many homeowners plan to use real estate to fund a comfortable retirement. In terms of estate planning, you’ll want to make sure your assets are distributed fairly. If the value of your home has increased significantly over time, you’ll need to ensure you have the right amount of insurance coverage if something happens.

Thinking about doing a home renovation project? If the value of your home has increased, that will allow you to borrow against the value of your home at a favourable interest rate. See how much home equity you can access if you refinance.

5. Consider upgrades to make your property more energy efficient

The Canada Greener Homes Grant provides eligible homeowners with up to $5,000 in rebates to retrofit their principal residence. This includes rebates for replacing windows and doors, adding insulation or installing a smart thermostat or heat pump.

In order to take advantage of this grant, you must confirm your eligibility and submit an application before starting your renovation project. Make sure to thoroughly read through the program details of what’s required for your retrofits. As part of the application process, you must complete an energy audit by hiring an energy advisor that is registered with Natural Resources Canada. Keep in mind, renters or landlords looking to upgrade their investment property cannot use this program.

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