Mortgage Basics

Incentives for First-Time Home Buyers in Quebec

Incentives for First-Time Home Buyers in Quebec
Written by
  • Ashley Howard
| 22 February 2024
Reviewed, 22 February 2024
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    In Quebec, individuals purchasing a home for the first time have access to various incentives to aid them in their purchase. These forms of support include non-refundable tax credits and lump sum payments to assist with downpayments. To qualify as a first-time buyer, neither you nor your spouse must have owned or co-owned a home within the past 4-5 years, depending on the qualifying criteria of the particular program. 

    As the housing supply in Quebec decreases and prices increase, we aim to help you understand the incentives and programs available for those in the market for their first home in Quebec.

    Key Takeaways

    • In Quebec, numerous programs are available to support individuals purchasing their first home, such as the Quebec Home Buyers’ Tax Credit. 
    • Montreal has its own set of incentives, which includes a maximum of $15,000 through the Home Purchase Assistance Program. 
    • First-time home buyers in Quebec can also take advantage of federal incentives, which include a withdrawal of up to $35,000 through the RRSP Home Buyers’ Plan.

    Incentives for First-Time Home Buyers in Quebec

    Quebec offers two non-refundable tax credits for first-time homebuyers. You may receive a maximum of $1,500 from the Quebec Home Buyers’ Tax Credit and an additional $1,500 through the federal First-Time Home Buyers’ Tax Credit (HBTC).

    If you are recognized as a resident of Quebec on December 31st of the year you bought your first home, and the home is located in Quebec, you are qualified for the tax credit.

    Montreal residents purchasing a home for the first time can receive a maximum of $15,000 through the Home Purchase Assistance Program. To be eligible, individuals must not have owned a home in Quebec within the last 5 years and must plan to live in the new home as their primary residence.

    First-time buyers can also take advantage of the Quebec City Family Access Program (Programme Accès Famille). This program provides interest-free loans for downpayments on homes with a purchase price of less than $370,000. 

    Government of Quebec’s Home Buyers’ Tax Credit 

    Eligible first-time buyers in Quebec can receive a tax credit of up to $1,500. This amount can be divided among all qualified individuals claiming credit for the same home.

    To meet the requirements, you must reside in Quebec on December 31st in the year you purchase your first home. The property must also be located in Quebec to qualify. You may also meet the criteria if you have purchased a qualifying property intending to make it the primary residence for a disabled person who is a relative.

    Eligible Dwellings

    To be eligible for the Quebec Home Buyers’ Tax Credit, the residence must be situated in Quebec, serve as your primary residence, and fall under one of the following categories: 

    • detached, semi-detached or row home,
    • manufactured home,
    • mobile home,
    • unit in a condominium building or a complex with multiple residential units

    A qualifying property could also refer to a portion of the capital stock in a cooperative housing corporation, giving you the right to own a housing unit as long as your ownership is officially recorded in the land register.

    Steps to Fill Out Form TP-752.HA-V for the Home Buyers’ Tax Credit

    The Home Buyers’ Tax Credit (TP-752.HA-V) form is available at this link. It is necessary to fill out the form if you are claiming the home buyers’ tax credit on line 396 of your income tax return.

    To fill out the form, you will require details regarding the property, your personal information (such as your most recent income tax return), and any additional owners (along with their most recent income tax return).

    City of Montreal’s Home Purchase Assistance Program 

    The Home Purchase Assistance Program offers a financial incentive of $5,000 to $15,000 for families who are either first-time homebuyers or experienced buyers.

    To be considered a first-time homebuyer, you are required not to have owned a home in Quebec within the past 5 years unless it was for a non-primary residence, such as a cottage. To be eligible as an experienced buyer, you must have a child under 13 years old or expect to have a child through birth or adoption within 9 months of buying the home. The child must reside with you at least 40% of the time to be eligible under the program.

    The amount of financial aid you qualify for depends on the type of home (new or existing) and your status as a first-time or experienced buyer.

    Quebec City Family Access Program

    The Quebec City Family Access Program (Programme Accès Famille) provides financial aid through an interest-free loan. This program is available to couples with or without children and single-parent families who make a maximum gross income of $150,000 and fulfill all eligibility requirements. 

    Eligible applicants can receive a loan of up to 5.5% of the property value, with a maximum home purchase price of $370,000. It is important to note that individuals who have not owned a home for 5 years prior to the purchase are eligible for this program.

    If the home is Novoclimat approved, a direct rebate of 3.5% will be applied directly towards the mortgage as an added credit.

    If you choose to sell, rent, refinance, or reach the end of the original amortization for the home, the loan will need to be repaid. The repayment will consist of the original loan plus either 5.5% of the home’s increased value (without an energy efficiency certification) or 9% of the home’s increased value (with Novoclimat approval).

    Federal Programs for First-Time Home Buyers

    Additional federal programs can be utilized along with those designed for Quebec residents. These federal programs can maximize savings for first-time buyers.

    RRSP Home Buyer’s Plan

    The Home Buyer’s Plan (HBP) permits individuals to take out a maximum of $35,000 from their RRSP to purchase or construct an eligible residence for themselves or a family member with a disability. The total amount that can be withdrawn under the plan is $70,000 if you have a spouse or common-law partner, with each person able to withdraw up to $35,000.

    Payments from the HBP must be returned to your RRSP within 15 years, or they will be treated as taxable income. However, there is a grace period of 2 years after the year of withdrawal where no repayments are necessary. For example, if you take money out of your RRSP in 2024, you will need to start making payments when you file your taxes in 2026.

    Home Buyers’ Amount

    If you are buying a qualifying home, you could receive a rebate of up to $1,500 through the Home Buyers’ Amount. On line 31270 of your tax return, you can claim up to $10,000 or split the amount with your spouse or common-law partner for a maximum combined total of $10,000. 

    GST/HST New Housing Rebate

    The GST/HST New Housing Rebate reduces taxes on new or substantially renovated properties. Eligible individuals can receive a refund for a portion of the GST or HST paid on the property. The specific amount and eligibility requirements will vary depending on the province in which the property is located.

    Frequently Asked Questions

    Who qualifies as a first-time home buyer in Quebec?

    To qualify for first-time buyer incentives specific to Quebec, you must be a resident of Quebec when the property is purchased and meet all other eligibility criteria.

    What’s the minimum downpayment in Quebec for first-time homebuyers?

    Your downpayment must be a minimum of 5% of the purchase price for homes valued at $500,000 or less and 10% of the remaining amount if the home is between $500,000 and $999,999. Homes valued at over $1 million require a minimum 20% downpayment.

    Are first-time home buyer incentives worth it?

    Yes, incentives for first-time buyers can help you reduce the costs associated with purchasing your first home. Combining the incentives and programs you qualify for can add up to considerable cost savings, making it worthwhile to take advantage of every incentive and program you are eligible for.

    Final Thoughts

    First-time buyers face many expenses that only add to the extensive list of worries about purchasing their first home. Finding a place to call home is never simple, particularly during times of economic instability. Nonetheless, a mix of federal and provincial incentives available in Quebec can assist first-time buyers in entering the real estate market.

    For first-time buyers looking for a place to settle down and call home, compare and save with the top mortgage rates available and reach out to a mortgage expert today.