The new $10,000 bonus for first-time buyers of new homes will likely help a lot of potential buyers make the leap into the real estate market, a mortgage expert says.
Ryan McKinley, mortgage development manager at Vancity, said he’s had a lot of calls from buyers seeking to understand the bonus, but no one who has yet bought a home because of it.
“Mortgages have been top of mind for many people lately, and the calls that I’ve been getting have been in regard to clarity — what this is, and can they take advantage of it,” McKinley said. “Spring tends to be a popular buying season.”
The bonus, a one-time refundable personal tax credit, equal to five per cent of the purchase price of a home to a maximum of $10,000, was announced last month in the provincial budget. The bonus is still subject to legislation, which is expected to be introduced sometime this spring.
“I think it’s fantastic,” McKinley said. “I think it will definitely make it easier for people to get into the real estate market and if they’re thinking about it, that might be the deciding factor.”
He said because the $10,000 will come directly to purchasers in the form of a cheque, it will be possible to apply it in several different ways. Someone could take a loan from their parents or a line of credit from a bank to make a down payment, then repay it when the bonus comes through.
“A lot of people are surprised at how much they can afford when they actually sit down with someone,” McKinley said.
McKinley said Vancity also has a “mixer mortgage” where roommates can go together to buy a home they wouldn’t be able to buy otherwise.
“It also works well for parents and children, because the parents can own part of the home as an investment, while it helps the child get into the market,” McKinley said. “It definitely helps people get into the market younger.”
- excerpts from ‘$10k home-buyer bonus sure to spur first-timers: mortgage expert’, Vancouver Sun, 19 Apr 2012
[hat-tip Zerodown, who commented "The glass is overflowing at VanCity"]
The contradictions are so obvious, they must be apparent to everyone.
BOC Governor Carney implores Canadians, for the 6th or 7th time, to take on less debt.
BC Provincial Government adds teaser loans to already criminally cheap mortgages to tip the last marginally qualified young buyers into the market. Shame on everyone involved.