7 First-Time Home Buyer Programs and Incentives for Manitoba Residents

• Home Buyers' Plan (HBP): Withdraw RRSP funds, tax-free, to put towards a first home purchase.

• First Home Savings Account (FHSA): Tax-free savings account for a first home down payment.

• First-Time Home Buyers’ Tax Credit (HBTC): Claim a tax credit to offset purchase costs.

• GST/HST New Housing Rebate: Recover part of GST or HST on a new home build.

• First Time Home Purchase Program (FTHPP): For Metis citizens who are first-time home buyers to assist with down payment and closing costs.

• Rural HomeOwnership Program (RHP): Provides affordable homeownership through Manitoba Housing in rural areas.

• Manitoba Tipi Matawa Program (MTM): A Manitoban First Nations, first-time homebuyers' program that is designed to help with down payment, while providing home-purchase education.

7 First-Time Home Buyer Programs Available in Manitoba

When buying your first home, you might be surprised by the additional costs beyond your down payment.

Expenses like moving fees, legal costs, inspections, and taxes can quickly add up, sometimes catching new buyers off guard. Fortunately, first-time homebuyers in Canada have access to programs designed to offset these costs, making homeownership more accessible.

Here’s an overview of seven valuable programs available for first-time homebuyers in Manitoba:

1. Home Buyers’ Plan (HBP)

Overview

Requirements include being a first-time buyer and intending to use the home as your principal residence within one year. You must repay the loan within 15 years to avoid penalties, starting the second year after withdrawal.

2. First Home Savings Account (FHSA)

The First Home Savings Account (FHSA) is a new registered savings plan in Canada designed to help Canadians save for their first home, combining the tax benefits of an RRSP and a TFSA. Here’s how it works and why it could be beneficial if you buy a home.

Benefits of the FHSA

• Tax Deductible Contributions:

  Similar to an RRSP, your contributions to an FHSA are tax-deductible, which can lower your taxable income and reduce the tax you owe.

• Tax-Free Growth:

  Any investment income generated in the FHSA, like from mutual funds, stocks, ETFs, or savings accounts, is tax-free while it remains in the account.

• Tax-Free Withdrawals:

  When used for buying a qualifying home, withdrawals from the FHSA are tax-free, much like a TFSA. This makes it a highly efficient way to save for a down payment.

Eligibility for Opening an FHSA

To open an FHSA, you must:

• Be a Canadian resident who has reached the age of majority in your province or territory.

• Be a first-time homebuyer, which means you have not lived in a home you owned, individually or jointly, in the current year or the past four calendar years.

Contribution and Withdrawal Limits

• Contribution Limits:

  • Annual limit: $8,000, including any funds transferred from an RRSP

  • Lifetime limit: $40,000

  • Any unused portion of the annual contribution can be carried forward, allowing you to contribute up to $8,000 in any one year

• Usage Period:

  You must use your FHSA contributions within 15 years of opening the account, or before age 71. After that, you can transfer the savings into an RRSP or RRIF without penalty, or make a taxable withdrawal.

• Qualifying Withdrawals:

  There’s no maximum on how much you can withdraw tax-free, provided you use the funds for a qualifying home. You may also be able to access your RRSP under the Home Buyers' Plan for the same home purchase.

Who Qualifies as a First-Time Homebuyer?

You qualify as a first-time homebuyer if you haven’t lived in a property you owned in the past 4 years or never purchased a home.

Newcomers to Canada are eligible, too, provided they have a valid Social Insurance Number (SIN) and meet the residency and homebuyer requirements.

How Does the FHSA Compare to Other Plans?

The FHSA combines features of both the RRSP (tax-deductible contributions) and the TFSA (tax-free withdrawals), making it an appealing option to save for a down payment on your first home.

It allows Canadians to save more effectively by taking advantage of tax-deferred growth and tax-free withdrawals, depending on how funds are used.

With its unique blend of benefits, the FHSA could help first-time homebuyers reach their savings goals faster, making homeownership more accessible.

3. Home Buyers’ Tax Credit (HBTC)

The HBTC is a federal, non-refundable tax credit encouraging Canadians to purchase their first home.

This credit applies to properties in Canada that must be registered with the land registry office in your name or jointly with a spouse or common-law partner.

This tax credit can help ease the costs associated with homeownership, by offering a valuable reduction in your income taxes for the year of your home purchase. For those new to the market, it's an easy-to-miss credit that could save you significantly during tax season.

Who Qualifies as a First-Time Home Buyer?

You may qualify if:

• You, your spouse, or common-law partner haven’t owned a home you lived in within the last 4 years.
• You’ve never owned a home before.
• You must occupy the home as a principal place of residence no later than one year after it is purchased.

The four-year rule allows some individuals who’ve owned homes in the past to qualify if it’s been long enough since their last ownership.

Disability Exception: If you or a relative claim the disability tax credit, you may qualify for the HBTC even if you’ve owned a home recently. This also applies if you’re helping a relative with a disability buy a home to live in.

How Much Can You Claim?

• You can claim up to $10,000 individually or split the amount with your spouse or partner, which provides a tax reduction of up to $1,500 (at the 15% tax rate). For example, each of you can claim $5000 and get a credit to reduce your income tax payable by $750.

• The HBTC is non-refundable credit and will reduce the amount of taxes you owe by $750. It cannot be anymore then this amount— if you don't owe income tax, you won’t receive a benefit from the HBTC.

What Properties Qualify?

The HBTC covers a range of property types as long as they serve as your main residence:

• Single-family homes
• Semi-detached homes
• Townhouses
• Mobile homes
• Condos
• Units within apartment buildings, such as duplexes, triplexes, or fourplexes
• A share in a co-operative housing corporation that entitles you to own and provides an equity interest

Homes under construction also qualify if you move in within one year after closing.

4. GST/HST New Housing Rebate

The GST/HST New Housing Rebate is designed to help Canadian homebuyers recover a portion of the tax paid on new builds, substantially renovated homes, and certain other property types.

Here’s how you can determine if you qualify and how to claim it.

How to Qualify for the New Housing Rebate

The New Housing Rebate is available for those buying or building a new home to serve as their primary residence in Canada. It applies to:

• New Construction or Preconstruction Homes:
  • The home must be bought from a builder registered with the GST/HST New Housing Rebate program.
  • The property should be your primary residence.
• Substantial Renovations:
  • The rebate can apply to resale homes if they undergo substantial renovations, meaning at least 90% of the interior is removed or replaced.
  • It’s available only if the home is your primary residence and located in Canada.
• Eligible Property Types:
  • This includes newly constructed or preconstruction houses, condos, mobile homes, floating homes, bed and breakfasts, or duplexes.

Claiming the New Housing Rebate

• Application Process:

  • Submit the rebate form on the Canada Revenue Agency (CRA) website within 2 years of the construction or purchase date.

  • Provide required documents like your sales contract, settlement statement, and any other applicable paperwork.

• Builder-Assisted Application:

  • If you purchased a new home from a builder, they might be able to apply for the rebate on your behalf.

• CRA Review:

  • Once the CRA processes your application, you’ll receive notification of the decision and, if approved, a cheque for the rebate amount.

Rebate Amounts

GST/HST Rebate Value:

• • The rebate is 36% of the GST or the federal portion of the HST, capped at $6,300.

  • Homes with a fair market value of up to $350,000 qualify for the maximum rebate amount. Homes valued over $350,000 may qualify for a partial federal rebate and provincial rebates, where applicable.

5. First Time Home Purchase Program (FTHPP) 

The First Time Home Purchase Program (FTHPP), available to citizens of the Manitoba Metis Federation (MMF), was created to address the housing needs of its citizens in rural and urban areas.

It is delivered through the Louis Riel Capital Corporation (LRCC) and meant to provide homeownership opportunities where citizens might not have otherwise had. 

6. The Rural Homeownership Program

The Affordable Homes Program or also known as The Rural Homeownership Program is designed to help eligible buyers purchase affordable homes through Manitoba Housing in select rural communities in Manitoba. This program provides financial support for down payments, legal fees, and other initial expenses, making homeownership more accessible. It is offered through two streams:

1. Tenant Affordable Homes Stream: Allows qualifying Manitoba Housing tenants to buy the home they’re renting (subject to approval) or a vacant home in a rural area.

2. Vacant Affordable Homes Stream: Allows qualifying applicants to purchase a vacant home owned by Manitoba Housing in designated rural communities.

Eligibility Criteria

• Current Housing: You must currently rent from Manitoba Housing in selected rural communities or wish to purchase a vacant home owned by Manitoba Housing.

• Income Limits (Effective January 2024):

  • Households without children: Maximum income of $67,900

  • Households with children or dependents: Maximum income of $90,500

  • For additional down payment assistance of 25%, maximum income is set at $46,500

• Ownership: You must not currently own other property.

• Mortgage Qualification: Applicants must qualify for a mortgage from a financial institution.

• Primary Residence: The purchased home must be your primary residence.

Financial Assistance Available

Down Payment Assistance

• 10% of Purchase Price: Forgivable over five years, with one-fifth of the assistance forgiven each year you live in the home.

• 15% or 25% of Purchase Price: Forgivable after 15 years of continuous ownership and occupancy. The 25% level is for those with household incomes below $46,500.

Example (for a $60,000 home):

• Purchase Price: $60,000
• Down Payment Assistance:
  • 10% = $6,000 (forgiven over five years)
  • 15% = $9,000 (forgiven after 15 years)
• Total Assistance: $15,000
• Required Mortgage Amount: $45,000

Additional Assistance

• Land Transfer Tax and Fees: Covered by Manitoba Housing.
• Non-repayable Grants:
  • $1,500 Grant: To cover legal fees, second mortgage registration, and home inspection.
  • $1,000 Moving Grant: Available for those purchasing a vacant Manitoba Housing property.

Important Notes

• You are responsible for all mortgage payments to your financial institution.

• The level of financial assistance depends on the home’s purchase price.

• Information:

  • Phone: 204-451-3960 or toll-free at 1-855-201-4624

  • Email: mbrealestateinquiries@gov.mb.ca

  • https://www.gov.mb.ca/housing/progs/homeownership.html

7. Manitoba Tipi Mitawa (MTM) Homeownership Program

The Manitoba Tipi Mitawa program is a partnership initiative between the Assembly of Manitoba Chiefs and the Manitoba Real Estate Association (MREA).

It offers homeowner education and financial support to Manitoba First Nations families who are first-time home buyers.

Program Overview

With its comprehensive support, including financial assistance, educational resources, and flexibility in neighborhood choice, the MTM program is a valuable pathway to homeownership for First Nations families in Manitoba. Guidance through essential steps include:

• Financial Education – Understanding budgeting, savings, and credit.

• Home Maintenance Training – Learning how to care for a home.

• Realtor Selection – Choosing a REALTOR® to help with the home search.

• Home Purchase Support – Assistance through the purchase process.

Eligibility Requirements

To qualify for the MTM program, applicants must meet the following basic criteria:

1. First-Time Homebuyer: The applicant must be buying a home for the first time.

2. Residency and Background:

   • The primary applicant must be a member of a First Nation.

   • Have lived in Manitoba for the past 10 years.

   • Agree to undergo a voluntary credit report check.

3. Employment and Income:

   • Must have been continuously employed full-time for at least two years.

   • Annual household income should range between $50,000 and $84,600, excluding social assistance.

4. Household Dependents: The applicant must have dependents living in the household, such as a person under the age of 22, or a person under the age of 26 who is registered in full-time study, or a person of any age who is recognized as a dependent of someone in the household for income tax purposes

5. Commitment to Education:

   • Must attend approximately 40 hours of educational sessions on financial literacy, home maintenance, and home purchase orientation.

6. Home Purchase Requirements:

   • Be willing to buy a home (minimum two bedrooms) within Winnipeg or Brandon or another major urban center.

   • Use a registered member of the Canadian Association of Home and Property Inspectors (CAHPI) for mandatory home inspection.

   • Request a Property Disclosure Statement from the seller.

7. Public Relations Participation: Willingness to participate in public relations for MTM.

8. Minimum Deposit: Must have at least $5,000 available for the home deposit.

Selection Process

Eligibility is assessed based on creditworthiness, which includes:

• Income: Consistent income within the program’s specified range.

• Credit History: Positive credit score and manageable debt ratio.

Program Financial Support

• Maximum House Price:

  • Up to $250,000 for homes in Winnipeg and Brandon.

  • Up to $225,000 for homes in other communities.

• Down Payment Assistance:

  • The program provides a 15% down payment:

    • 10% is funded by the Manitoba government.

    • 5% is funded by Manitoba Tipi Mitawa.

• Legal and Closing Cost Assistance:

  • The program offers up to $4,000 to cover legal fees and closing costs, helping reduce upfront costs for first-time homebuyers.