First-time homebuyers in Ontario will now be eligible for up to a $4,000 rebate on provincial land transfer tax – an increase of $2,000 from current tax rules.
Earlier this month, the Ontario government had promised first-time homebuyers a measure to help with ever increasing housing prices in the province. In light of recent mortgage rule changes implemented on the Federal level, coupled with ever increasing home prices, the province decided that first-time homebuyers were in need of some help.
Today’s announcement from Ontario Finance Minister Charles Sousa made it official – as first-time homebuyers are now eligible to receive an additional $2000.00 in tax credits on the provincial land transfer tax. Based on Ontario’s 2016 provincial land transfer tax rates, this would mean that a property of up to $368,300 would have a net tax of $0. With the current tax rebate of up to $2000.00, only properties up to $227,500 would have a net zero provincial land transfer tax.
The new tax credit for first-time homebuyers is scheduled to go into effect in January 2017.
Not sure if you qualify as a first-time homebuyer for the Ontario tax rebates? Find out how to qualify and how you can claim your first-time homebuyer land transfer tax refund here.
The additional $2000.00 in tax savings will come as a relief to some as the real estate market in the GTA continues to sizzle. October was another hot month for real estate in the Greater Toronto Area as 9,768 homes changed hands, an 11.6% increase over October 2015, and prices ballooned 21 percent over the same month the year prior.
Monday’s announcement also had some changes in store for buyers of homes in excess of $2 million, as the Ontario government announced an increase in the tax rate on luxury homes. As of January, on any purchase amount greater than $2 million dollars, the Ontario land transfer rate will be increasing from 2.0% to 2.5%. This tax increase on luxury homes is expected to bring in an additional $105 million to government coffers and to help fund the added rebate for first-time purchasers. The Ontario land transfer tax rate currently ranges from 0.5% on the first $55,000 to 2.0% on amounts over $400,000.
The new tax rate on homes over $2 million will cost homebuyers an additional $500.00 for every $100,000 above the $2 million mark.
If you have any questions about your status as a first-time homebuyer and how you can take full advantage of the latest tax rebate changes, fill out the form at the top of the page to speak to a MonsterMortgage.ca Mortgage Expert today!BACK TO BLOG FEED