The Victoria real estate market is one of Canada’s most expensive after Toronto and Vancouver.
But recent changes to a federal program could translate into more opportunities for first-time home buyers, according to Kam Brar, owner of Auxilium Mortgage Corporation.
“I think it’s going to be more positive than what we’ve had before,” Barr said.
Changes to the First Time Home Buyers Incentive Program include eligibility.
Under the new changes, the increase of annual income in a household rises from $120,000 to $150,000 and buyers mortgage has increased to 4.5 times one’s annual income. Previously it had been limited to four times.
That opens up the market to properties worth up to $850,000.
“If you are a family with a child or two children right now, you can look at townhouses, you can look at single-family houses without suites. It suddenly is going to open up some doors for people,” Brar said.
Victoria Mayor, Lisa Helps calls the program changes significant for the city’s middle-income earners.
“We’ve got a growing city, we’ve got a growing economy. Families want to live here and families want to live in all of our neighbourhoods; Fairfield, Fernwood, James Bay.”
Buyers can now look at properties worth up to $850,000.
So for example, if a home worth $722,000 can be purchased with a $47,000 down payment that is split between the homeowner and the federal government.
“Essentially $23,600 from the client. $23,600 from the program. which would give you a mortgage of about $675,000. That’s a big jump up. Before we were capped at somewhere around $500,000. So that is a definite improvement,” Brar said.
Brar says another advantage is that under the program almost 70 per cent of each dollar paid to the mortgage, goes straight to the principal.
Changes to the federal government’s First Time Buyers Incentive Program are expected to take place next year.