CMHC’s First-Time Home Buyer Incentive Off to a Slow Start

CMHC's First-Time Home Buyer Incentive has funded just 4% of its three-year goal, according to new data provided by the agency. From Sept. 2 to Dec. 9, CMHC received just 3,252 applications from across Canada, 2,730 of which were approved. This translated into total funding of $51.3 million, well off pace of the agency's three-year target of $1.25 billion. Interest in the program was highest in Quebec, where 1,300 applications were received, while just 436 Ontarians applied. CMHC head Evan Siddall defended the results via Twitter, noting that uneven lender support is a complicating factor.

The First Time Home Buyer Incentive (FTHBI) has been criticized for being overly complicated and promising negligible benefits. It is currently limited to purchases of up to $565,000. In markets like Toronto and Vancouver, buyers can be hard-pressed to find available properties under that threshold. Prime Minister Justin Trudeau promised tweaks to the FTHBI during last year’s federal election, but no additional updates have been provided. It remains to be seen if the FTHBI’s slow start is a harbinger of future demand or if first-time buyers will grow more receptive to sharing a chunk of their home equity with the government.