OTTAWA – September 16th, 2008 – REALTORS® welcomed today’s announcement by the Conservative Party of a proposed tax credit for first-time homebuyers for intended application against closing costs of the purchase of a home.
“The issue of affordability is one that REALTORS® constantly monitor, and we welcome this initiative,” says the President of the Canadian Real Estate Association, Calvin Lindberg.
However, REALTORS® believe that the changes to the existing, well-known Home Buyers Plan that CREA has been advocating for several years will also be an effective way to address the issue of affordability for first-time buyers. CREA proposes that the federal government raise the maximum withdrawal limit in the Home Buyer’s Plan from $20,000 to $25,000. The HBP is a unique program that encourages savings, maximizes down payments and helps first-time homebuyers minimize debt over time.
The current withdrawal limit has not been changed since the program was introduced in 1992. In 2007, using the HBP, nearly 105,000 Canadians borrowed more than $1.2 billion from their personal RRSPs to use as a down payment in the purchase of their first home.
“Research has shown that, despite their enthusiasm for home ownership, first-time buyers, especially younger Canadians, find it a real challenge to finance their first home,” says Mr. Lindberg. ”We welcome any initiative that helps these buyers.”