Justin Trudeau promises to expand first-time homebuyers program if elected

Liberal Party Leader Justin Trudeau is promising an expansion of the First-Time Home Buyer Incentive (FTHBI) program and the implementation of a national vacancy tax on homes to help curb foreign speculation in the housing market if the Liberals are elected in October.

The pledge expands the FTHBI program — first announced in this year’s budget — to cover home values up to $789,000, replacing the current cap of $480,000 in the hot housing markets of Toronto, Vancouver and Victoria, B.C.

The FTHBI program is aimed at first-time homebuyers who earn up to $120,000 a year and is designed to lower monthly mortgage payments without boosting costs on a down payment.

Under the program, the Canada Mortgage and Housing Corporation (CMHC) offers 10 per cent toward the down payment on a new home and five per cent on resale homes, interest-free.

Under the previous arrangement, a first-time buyer qualified for assistance if the total value of the mortgage did not surpass $480,000. If elected would see that amount increased to $789,000. Previous government estimates have said the program could save buyers up to $286 per month – or more than $3,430 per year – in mortgage payments on a $500,000 house.