More Than 3,000 First-Time Homebuyers Apply for B.C. Government Loan
Others think extra debt should be avoided: poll
In January 2017, the government of B.C. started offering 25-year loans for first-time homebuyers applying for mortgages. The B.C. Home Owner Mortgage and Equity (HOME) Partnership program will meet the buyer’s contribution up to 5 percent of the home’s purchase price, to a maximum of $37,500. The loans are interest- and payment-free for the first five years, after which they can be repaid in full or over 20 years at the prevailing rate of interest.
On the other hand, the Bank of Canada has warned about the high level of Canadians’ debts and exposure to the housing market, and the federal government has brought in measures to slow the housing sector, including affordability thresholds for uninsured borrowers to qualify for mortages from federally regulated lenders that take effect this month.
Shortly before the B.C. HOME Partnership program started, Mustel Groupconducted a poll for BCBusiness asking 300 B.C. residents if they thought government loans for first-time homebuyers are a good idea. Most (58.2 percent) said, “No. Canadians already carry too much debt,” which was the response from a majority of respondents in all categories— age, gender, property ownership and region—except in the Interior, and it was close even there (see poll results below).
Yet as of December 31, 2017, the program had received about 3,236 applications, according to BC Housing. Of these, 1,716 mortgage loans for first-time homebuyers have been approved and funded, with a total value of some $26.4 million.