We’re seeing significant changes to the mortgage landscape, and this update is designed to help first-time homebuyers gain better access to the housing market. Starting December 15, 2024, the Canadian government will introduce new rules allowing for 30-year mortgage amortizations for first-time buyers purchasing both new and resale homes.
Here’s how these changes could help you get your first #HomeToStay.
What’s Changing?
For the first time since 2012, first-time homebuyers, and anyone purchasing with less than 5% down will be able to access 30-year amortization periods on any type of property. This is a fantastic opportunity for those looking to enter the real estate market. If you’re planning to buy your first home in Barrie or surrounding areas, this is something you’ll want to know about.
What Does a 30-Year Amortization Look Like for Buyers?
30-year amortizations will allow first-time buyers to save approximately $50 per month for every $100,000 borrowed. While it may seem like a small amount at first, those savings add up over time and could make a significant difference in your monthly budget!
Currently
- Minimum down payment
- 25 Year Amortization
- Required household income: $155,000
- $700,000 home purchase
As of December 15
- Minimum down payment
- 30 Year Amortization
- Required household income: $155,000
- $750,000 home purchase
The extended amortization period opens up the possibility for first-time buyers to qualify for more expensive homes. With lower monthly payments, buyers can afford a more expensive property while staying within their budget.
Change in House Price Policy
Currently, the maximum house price for an insured mortgage is $999,999, with a minimum down payment of $74,999.
Effective December 15, 2024:
The new maximum limit will increase to $1,499,999, and the minimum down payment for this price will be $124,999. Previously, to purchase a home priced at $1,499,999, buyers would have needed a down payment of $299,999.80. The new rules reduce that requirement significantly, making higher-priced homes much more accessible for first-time buyers.
What Does This Mean for You?
If you’ve been thinking about buying your first home, this rule change is worth celebrating! It will help make homeownership more accessible by reducing monthly mortgage payments and allowing you to purchase a more expensive property with a smaller down payment. The timing is perfect if you’ve been looking for a home in Barrie or the surrounding area and want to take advantage of the current real estate market.
If you’re ready to explore your options or have questions about how these changes can benefit your home-buying journey, don’t hesitate to reach out. The Peggy Hill Team is here to support you every step of the way as you find your #HomeToStay. Let’s make your real estate dreams a reality!