The provincial government has unveiled a significant measure aimed at making it easier for first-time buyers to afford a home in B.C.
At a news conference in Cloverdale this morning (December 15), Premier Christy Clark announced that B.C. Housing would grant first-time buyers access to a maximum loan of $37,500 that would be put toward a down payment on a house.
The loans will be interest-free for five years, after which time the rate would be comparable to a mortgage. The maximum value of a property the loan can be used to purchase is $750,000.
That means the program won’t make it possible for many people to buy a detached house in the City of Vancouver. But it could bring within reach an apartment in the city or in nearby Burnaby or New Westminster, or a small house further out in the Metro Vancouver suburbs.
“I firmly believe that the dream of home ownership must stay within the reach of the middle class,” Clark said.
It’s estimated some 42,000 people will take advantage of the program over the course of the next three years, according to Clark. It's expected to cost $110 million to administer over that period.
According to the Real Estate Board of Greater Vancouver (REBGV), over the past three years the benchmark price for all residential properties in the region it describes as Greater Vancouver increased by 48.3 percent. As of May 2016, the benchmark price for a single-family detached home on the city’s East Side was $1.46 million. On the West Side, the benchmark price was $3.44 million.
Quoted in a media release, Rich Coleman, the minister responsible for housing, acknowledged that British Columbians are having trouble entering the housing market.
“The first step into the market can be the hardest step, so our government will partner with homebuyers to help them achieve their minimum down payment,” he said. “This partnership can help lower their monthly costs in the first five years, and help make home ownership more affordable."