In the recent 2019 Federal budget, a new CMHC initiative (for first time homebuyers) was released that has been created to try and help more people get into homeownership but will it?  And more specifically, who will it help?  It certainly isn’t going to work for everyone as the qualifications point out -so would you qualify if the program was released today?

  • Do you have 5% down?
  • Do you have income under $120,000 per household?
  • Are you looking to purchase under $480,000?

If you said yes to the above, you might qualify but notice that there is one very important element missing from the qualification criteria?  That’s right CREDIT!

The program has potential merit to help with affordable housing but seems to be aimed at people NOT looking to live in the GTA or surrounding area (good luck finding a decent property in Markham for under $480,000) but it will be hard to know the exact impact on who will benefit until the credit qualifications are defined and it does not look like that will happen until the Fall.

Try qualifying with a bankruptcy in your past or with collection items on your credit, oh and don’t forget about those families carrying too much debt.  They are likely trying to find a nice way to say you won’t qualify and that is why they are waiting until Fall to release all the details.

End of the day, it is an attempt to rectify some of the damage they have already caused to our housing market and good for the government for finding a way to capitalize because like everything in life, nothing is free and it is expected that the CMHC will retain a 10% share in the property which they will realize when you sell the property.  Doesn’t sound like much but trust me, it will be a shock 10 years from now when you go to sell and are told that you have to pay out the CMHC ownership stake with a $50,000 check.

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