First Time Home Buyers Program in BC
Property Transfer Tax Exemption Changes
The BC government has made some changes starting April 2024 to the First Time Home Buyers program where eligible individuals are either exempt completely or partially from paying Property Transfer Tax. These changes were laid out in the 2024 Provincial Budget.
The exemption threshold on a properties market value has now increased, allowing more First Time Home Buyers to benefit from this program!
Let’s start with what Property Transfer Tax is and then move on to eligibility for the First Time Home Buyer Program and the Changes.
What is Property Transfer Tax in BC?
Property Transfer Tax is a provincial tax in BC that is payable by a Buyer upon registering their property (closing on the purchase). Some exemptions may apply; see the link here for exempt properties.
This is how the tax is calculated:
- 1% up to and including $200,000 of purchase price
- 2% from $201,000 up to and including $2,000,000
- 3% on purchase price greater than $2,000,000
- There is an additional tax of 2% on properties greater than $3,000,000
Feel free to use the property transfer tax estimator linked here to find out how much certain properties will owe.
Are you eligible for a Property Transfer Tax exemption?
To be eligible to take part in this program, you must meet the following criteria on the date the property is registered (closing date):
- Be a Canadian citizen or a permanent resident
- Have either:
- Lived in BC for a minimum of 1 year immediately prior to registering the property
- Filed at minimum of 2 income tax returns as a resident of BC in the last 6 tax years immediately prior to registering the property
- Have never owned a principal residence property before anywhere in the world
- Have never received a First Time Home Buyer’s exemption or refund
- The property must:
- Only be used as your principal residence
- Be 0.5 hectares or less
- Contain only residential improvements
- Meet the fair market value thresholds laid out above
For full details around criteria, see the BC Government Article linked here.
What are the changes?
Previously, eligible First Time Home Buyers would be able to have a full exemption from paying Property Transfer Tax (PTT) if they purchased a property up to $500,000 and then a partial exemption if they purchased a property up to $525,000. The full exemption at $500,000 would allow eligible buyers to save $8,000 in PTT.
The government has now changed this to be a sliding scale up to $860,000 laid out as follows:
1. Purchase price is $500,000 or less
No PTT will be payable. Eligible individuals are fully exempt from the tax. At a purchase of $500,000, this is equal to $8,000 savings in tax.
2. Purchase price is $500,001 – $835,000
Eligible individuals are exempt from $8,000 of PTT. At a purchase price of $835,000, this would mean a buyer would only have to pay $6,700 in PTT ($14,700 in PTT – $8,000 exemption).
3. Purchase price is $836,000 – $860,000
A partial exemption will apply on a sliding scale.
For a full breakdown of the Property Transfer Tax at different price points, see the article linked here.
For any questions or clarifications, please contact me here!