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Nuts & Bolts of the Federal 2019 Budget | What you REALLY need to know!

by | Mar 19, 2019

On March 19, the Federal Government announced the official 2019 budget. One major topic on the discussion table (and one we were all holding our breath for) was the discussion of affordable housing in Canada.  So just what happened on “Budget Day?” Here are the highlights of the 2019 Federal Budget:


  1. CMHC First Time Home Buyers Incentive Plan
    • This would give first time home buyers the ability to share the cost of buying a home with CMHC
    • For existing homes – the incentive would provide up to 5% (funding/equity sharing) of the PURCHASE PRICE
    • For newly constructed homes the incentive would provide up to 10% (funding/equity sharing) of the PURCHASE PRICE
    • Funding/Equity sharing means that CMHC would cover a percentage of the purchase price
    • Example:
      • 400K purchase price, 5% down payment (20K), AND 5% CHMC shared equity mortgage (20K), the size of the insured mortgage would be reduced from 380K down to 360K, which would lower the monthly payment amount for the first time home buyer
    • To qualify for the program:
      • 120K max household income
      • Cannot borrow more than 4x their annual household income – making max purchase price approx. 505K
      • 100k household income would mean max 400K mortgage in order to use this program.
    • An increase of the previous $25,000 for RRSP withdrawal amount through the Home Buyers Plan to $35,000

These were the only two key changes that came out of the Federal Budget (so far). It provides minimal assistance for First Time Home Buyers, especially in a market like Vancouver and the Fraser Valley, who have home prices well above the 505k purchase price limit. However, it could provide assistance to those looking to purchase condos or townhomes ore in more rural areas. One area that will remain the same for the mortgage industry is the continued B-20 stress testing measures (which have recently come under fire)

The predicted start time is Fall 2019 for these guidelines. We will keep you updated on any new additions or changes as the information becomes available. To read more about the highlights of the 2019 budget, click here

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