Canada to allow 30-year amortization for first-time buyers' mortgages on new homes

April 11, 2024 at 11:35AM EDT

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The Canadian government will allow 30-year amortization periods on insured mortgages for first-time homebuyers purchasing newly built homes.

Finance Minister Chrystia Freeland made the announcement in Toronto today, saying it would take effect Aug. 1.

The Canadian Home Builders' Association has advocated for longer amortization periods, saying five more years would help with affordability and spur more construction.

Freeland also said the government will nearly double — to $60,000 — the amount first-time homebuyers can withdraw from RRSPs to buy a home.

That's up from $35,000, to take effect April 16, the day the federal budget is set to be released.

People who make such withdrawals between Jan. 1, 2022, and Dec. 31, 2025, are also getting more time to begin repayment — up to five years in total rather than two.

This report by The Canadian Press was first published April 11, 2024.