Canada’s under-25 crowd is facing the worst unemployment crisis on record, with the jobless rate near 30 per cent in May. For students returning in the fall, nearly 40 per cent are out of work.

The COVID-19 crisis hit precisely those industries that hire young workers the most, and many of those industries will still be struggling with social distancing measures as they reopen from the lockdowns.

In the video above, HuffPost Canada senior business editor Daniel Tencer runs down what this means for the future of Canada’s young people, and why it matters.

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CHELSEA, Que. — Grocery store employees who continued to work during the COVID-19 pandemic are “heroes” and should be properly compensated, said Prime Minister Justin Trudeau Friday.

Trudeau’s remarks came about a week after Canada’s three major grocers scrapped so-called pandemic wage premiums for their staff.

“The people who step up in the midst of the most serious times to ensure that Canadians can still put food on the table, that they can get deliveries they need, that shelves are stocked, that Canadian continue to be safe and fed are heroes of this pandemic every bit as much as our front-line health workers and emergency responders,” he said at a news conference in Chelsea, Que., after being asked for his reaction to the pay clawback.

Loblaw Companies Ltd., Metro Inc. and Empire Co. announced last week they would stop paying an hourly premium to store workers starting June 13.

Loblaw and Metro both had been paying workers an extra $2 an hour since March 8, while Empire offered a weekly bonus to all employees and a $2 hourly wage bump to those working more than 20 hours a week.

The companies provided various explanations for the decision, which was slammed by two unions that represent the workers.

Loblaw stores settled into a more stable situation, a spokesperson said at the time, adding the company has invested more than $280 million into safety measures and “is no longer benefiting financially from COVID-19.”

Metro and Empire noted a similar stability.

Workers who stepped up should be supported: Trudeau

Trudeau said that the people who have stepped up to help Canadians, often while risking their health or safety, should continue to be supported and respected.

“That’s why we will continue to exhort and expect that people who’ve stepped up during this time be properly supported and paid for it,” he said.

Trudeau’s comments come on the heels of the House of Commons Industry Committee voting unanimously on Thursday to summon representatives of Loblaw, Metro and Empire to explain how they came to the decision, within 24 hours of each other, to cut wage premiums for front-line staff. 

Deputy Prime Minister Chrystia Freeland was also asked about the decision at an Ottawa news conference Friday and whether it would impact if the companies receive future funding or access to programs.

“I hope that one of the things that this pandemic has taught us is that people who do some of the work which is most essential for our actual, our literal survival are among the lowest paid people in our country,” she said.

“I’m sure that was frightening for many of them,” she said, adding she has told workers at her local grocery stores just how grateful she is for their service.

“I do think that it behoves all of us, including employers, not to forget that lesson.”

Freeland added that the House has heard concerns that government support to Canadians may have provided a disincentive to work.

“I think the fact that grocery stores now feel able to bring the wages back down suggests that there isn’t a powerful disincentive to work out there,” she said.

A Metro spokesperson declined to comment, while Loblaw and Empire did not immediately respond to a request for comment on Trudeau and Freeland’s statements.

This report by The Canadian Press was first published June 19, 2020.

Purchasing a house in Canada is tricky at the best of times, but getting into the property market for the first time is especially tough. To help with some of the costs of buying your initial home, there exists a range of programs for eligible first-time homebuyers. It’s a good idea to learn about these programs to avoid leaving money on the table.

These are the five biggest first-time homebuyer programs in Canada. Some aren’t available in every province, so we’ve noted where that’s the case.

1. Land transfer tax rebates

One of the largest closing costs when purchasing a home is the land transfer tax, which is charged in every province except Alberta and Saskatchewan. The City of Toronto also charges a land transfer tax on top of the Ontario tax. Land transfer tax rates are generally between 0.5 and 3.0 per cent of the home purchase price.

To help manage the cost of land transfer tax, Ontario, British Columbia, Prince Edward Island, and the City of Toronto offer rebates for first-time homebuyers. These programs reimburse some, or all, of your land transfer taxes. Each location has a maximum rebate, listed below:

• City of Toronto: $4,475
• Ontario: $4,000
• British Columbia: $8,000
• Prince Edward Island: $2,000

If you’re buying the home with someone who is not a first-time homebuyer, this may prevent you from qualifying for some, or all, of the rebate. Different eligibility rules apply for each location. Some governments require that you’ve lived in the province for a certain amount of time to claim the rebate. Others require that your home’s property value be less than a certain amount. Check your government’s website for exact qualification requirements in your location. 

2. The Home Buyers’ Tax Credit

The Home Buyers’ Tax Credit (also referred to as The Home Buyer’s Amount) lets first-time homebuyers claim $5,000 of a property purchase on their tax return. With current tax rates, that results in a $750 rebate.

You’ll need to claim this credit on your tax return in the year you buy the property. You can split the credit between two returns for joint purchases, but the overall claim can’t exceed $5,000. 

RELATED

• Canadian Mortgage Rates Hit Lowest Levels Ever

• Should You Use A Broker Or A Bank When Getting A Mortgage Loan?

• A Mortgage Pre-Approval Could Save You Stress When You’re Buying A Home

• Fixed Or Variable? How To Decide Which Mortgage Is Right For You

3. GST/HST New Housing Rebate

When you purchase a newly built house, construct a new house, or make substantial renovations to your existing home, you’ll be charged GST or HST. The GST/HST New Housing Rebate reimburses a portion of this.

This rebate isn’t exclusive to first-time homebuyers, but many first-time buyers use it when purchasing a new home. Eligibility and rebate amounts depend on the province your home is located in. You can claim the rebate within two years of buying your new house, or from when construction was completed.

4. The Home Buyers’ Plan

The Home Buyers’ Plan (HBP) is not a credit. Instead, it’s a way for you to increase your down payment with money from a Registered Retirement Savings Plan (RRSP), thus increasing how much mortgage you can afford.

First-time homebuyers can withdraw up to $35,000 from an RRSP, but it’ll need to be repaid (on a non-deductible basis) within 15 years to avoid a penalty. Any amount withdrawn needs to have been in the RRSP for at least 90 days – if not, those contributions may not be tax-deductible.

It’s important to consider the long-term financial implications of this program. While borrowing from your RRSP can increase what you can afford today, you may sacrifice outsized returns that could have come from maintaining your RRSP.

5. The First Time Home Buyer Incentive

This program is also not a rebate. Rather, the First-Time Home Buyer Incentive is a shared-equity mortgage with the Canadian government. With this program, the government takes a 5 to 10 per cent stake in your home, with you retaining exclusive access.

This lets you buy a home with a smaller deposit and lowers your monthly mortgage payments. The government contribution needs to be repaid within 25 years, based on the home’s market price at the time the incentive is paid back. This means that if your home’s value goes up, then the government also benefits from the increase. The same is true should your home’s value decrease. If the home is sold before the contribution is repaid, the government receives its applicable share from the sale.

This program is interesting, but it doesn’t suit everyone. Firstly, not all homebuyers will want a shared-equity mortgage. Secondly, the incentive has some very specific eligibility criteria, which limit the types of buyers the incentive is useful for. 

READ MORE

• CMHC’s New Rules Cut Maximum Home Purchase Price Up To 12%: Experts
• Rich Torontonians Eyeing An Exodus From City After Pandemic: Agency
• Canadian Homebuyers Face ‘Debt Cliff’ This Autumn, CMHC Warns
• Forced Selling May Be Headed For Canada's Housing Market

Are you a first-time homebuyer?

To be eligible for most of these programs, you’ll need to be considered a first-time homebuyer. Keep in mind that some programs have additional eligibility factors. Check with your local government or a local mortgage professional to be sure.

Here are some key factors that could affect your eligibility as a first-time homebuyer:

First-time homebuyers: You’re generally considered a first-time homebuyer if you have not previously had any ownership stake in a home at any time. However, for federal government programs, you can qualify as a first-time homebuyer so long as you have not occupied a home that you (or your spouse or common-law partner) own in the year of your new home purchase and the four years prior.

Owner-occupied: The property you’re buying generally needs to be your main residence. Exact rules vary, but you’ll typically need to move in shortly after purchase.

Residential status: You’ll need to be a resident of Canada to apply for most first-time homebuyer programs. Some programs also require you to be a permanent resident or Canadian citizen. Moreover, some programs and provinces require you to have lived in a province for a certain time period.

Co-buying: If you’re a first-time homebuyer but your buying partner isn’t, you may only be able to claim a portion of a program.

People with disabilities: There are special rules and additional rebates for people with disabilities. Many first-time homebuyer programs can be claimed by people with a disability multiple times, subject to certain conditions.

The bottom line

As a first-time homebuyer in the 21st century, you’ll want every bit of help you can get. The programs available in Canada go a long way towards making buying a home easier and more affordable.

If you need more information or advice, it could be worth speaking to a mortgage professional such as a mortgage broker. Along with providing advice, mortgage brokers can often find you better mortgage deals than you would have found yourself. 

For more government resources, check out the links below:

• Land Transfer Tax Rebates: Ontario, B.C., P.E.I., Toronto
• The Home Buyers’ Tax Credit
• GST/HST New Housing Rebate
• Home Buyer’s Plan
• First-Time Home Buyer Incentive

Le jury du 64e Festival de Locarno, présidé par Paolo Branco a rendu son verdict ce samedi : le film hélvetico-argentin “Abrir puertas y ventanas” remporte le Léopard d’or.

Du sang neuf pour le Léopard ! Le jury du 64e Festival de Locarno, présidé par le producteur Paulo Branco, a décerné la plus haute récompense, le Léopard d’or, à Abrir puertas y ventanas de Milagros Mumenthaler, réalisatrice d’origine suisse et argentine, âgée de 34 ans. Ce premier long métrage, qui brosse le portrait de trois soeurs au sortir de l’adolescence, à Buenos Aires, vaut également à la jeune Maria Canale le Prix d’interprétation féminine. Joli doublé également pour le film roumain Din dragoste cu cele mai bune intentii, qui  décroche à la fois le prix du Meilleur réalisateur pour Adrian Sitaru (à qui doit déjà le remarqué Picnic et celui du Meilleur acteur pour Bogdan Dumitrache.

Une mention pour Mia Hansen-Love

Le maître japonais Shinji Aoyama se voit honoré par un Léopard d’or spécial pour son dernier long métrage, Tokyo koen, et pour l’ensemble de sa carrière, tandis que le prix spécial du jury revient à Policeman (Hashoter) de Nadav Lapid, premier film israélien dont le héros est un policier d’élite. A noter que Nadav Lapid et Milagros Mumenthaler furent tous deux pensionnaires de la Cinéfondation du Festival de Cannes en 2007. Au sein de l’imposante délégation française de la compétition suisse, seul Un amour de jeunesse de Mia Hansen-Løve (actuellement en salles) tire son épingle du jeu avec une Mention spéciale. Autre film issu de l’hexagone, mais vu dans la section Cinéastes du présent, Nana de Valérie Massadian, centré sur une enfant de quatre ans, reçoit le Léopard de la Meilleure première oeuvre.

JD

Mardi prochain, AlloCiné vous proposera l’émission Carnets de voyage consacrée au 64e Festival de Locarno. Au programme : Harrison Ford, Abel Ferrara, Emmanuel Mouret, Leslie Caron, Nicolas Klotz…

EU Parliament calls for slave trade to be labeled ‘crime against humanity’

MEPs call for December 2 to be ‘European Day commemorating the Abolition of the Slave Trade.’

Members of the European Parliament on Friday backed a resolution calling on the EU to recognize the slave trade as a “crime against humanity” and make December 2 the “European Day commemorating the Abolition of the Slave Trade.”

The resolution, backed by 493 MEPs with 104 voting against, is not binding but aimed at putting pressure on European governments to take action against racism in the wake of the killing of George Floyd in the United States and a wave of worldwide protests in support of the Black Lives Matter movement. 

Younous Omarjee, a French far-left MEP who was behind the call, said in a statement that the Parliament now becomes the “first international institution to proclaim … that the transatlantic trade and slavery are a ‘crime against humanity.'”

“In this moment of international indignation against the racist murder of George Floyd … of the collective denunciation of continuous stigmatizations, of permanent discrimination against non-white people … we must be brave enough to take action,” Omarjee wrote.

“The adoption of the resolution is a historically important victory,” said Alice Bah Kuhnke of the Greens. ”It shows that progressive forces, across party borders in the EP, stand firm in our call to end racism and discrimination in the US and in the EU, and to condemn police violence and attacks on journalists who are documenting the protests.”

She added: “The situation, with the public demonstrations and strong opposition to racism, gives us an opportunity to take important political steps to address racism, discrimination and police violence both legally and in our action. If not now, when?”

The resolution, put forward by MEPs from the three biggest political groups, calls on the EU to “officially acknowledge past injustices and crimes against humanity committed against black people and people of color, declare the slave trade a crime against humanity” and calls for December 2 “to be designated the European Day commemorating the Abolition of the Slave Trade.”

The worldwide protests, the resolution adds, “led to the recollection of Europe’s colonial past and its role in the transatlantic slave trade.” It also recommended the introduction of the “history of black people and people of color” into school curricula and holding a “European Anti-Racism Summit on combating structural discrimination in Europe.”

The resolution was adopted days after European Commission President Ursula von der Leyen made an impassioned speech to MEPs in which she admitted that she had not personally experienced discrimination and urged steps to end both overt injustices and invisible bias.

“We relentlessly need to fight racism and discrimination: visible discrimination, of course, but also more subtle racism and discrimination, our unconscious biases,” she said.

Just before von der Leyen’s speech, Pierrette Herzberger-Fofana, a black MEP from the Greens group, told her colleagues that she had filed a legal complaint after several Belgian police officers “brutally pressed” her against a wall in order to search her.

The incident led European Parliament President David Sassoli to send a letter to Belgian Prime Minister Sophie Wilmès asking her to take “immediate and necessary measures” to resolve the case.

“As president of this institution, and in the name of MEPs, I firmly condemn any disproportionate use of violence, including from the police,” Sassoli wrote.

OTTAWA — The federal deficit could be on track to hit $256 billion this fiscal year due to the COVID-19 pandemic, Parliament’s budget watchdog says in a new estimate that doesn’t account for this week’s extension to a cornerstone benefit for workers.

Budget officer Yves Giroux’s report said the deficit estimate is the combination of a projected $169 billion in federal spending on emergency aid and a historic drop in economic output.

The overall deficit figure is only $3.8 billion higher than Giroux’s office previously predicted despite some major new government spending plans, which his report says is due to a better economic outlook for the second half of the year.

But the figures don’t include the extra cost for a promised extension of the Canada Emergency Response Benefit to provide eight more weeks of payments to recipients about to hit the current 16-week maximum, nor the possible cost to make some of the measures permanent.

Giroux also warned that spending could go up further if the government pumps more stimulus to promote economic recovery, beyond the $14 billion the Liberals have promised to provinces to help minimize the risks in reopening workplaces.

Possible changes and uncertainty about the course of the pandemic led Giroux to stress that the figures in his report are the outcome of one of many possible scenarios and not a certain forecast.

The report comes one day after Prime Minister Justin Trudeau promised to deliver a “snapshot” of federal finances on July 8 that will provide short-term spending estimates.

Trudeau warned the document won’t provide a longer-term outlook because of uncertainty about where the economy will go in the coming months and years — all of which rests on the path of the pandemic.

RELATED

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• Federal Deficit Headed Above $250 Billion This Year: Budget Watchdog

The budget office estimates the economy could shrink by 6.8 per cent in 2020, the weakest showing since 1981 and double the record of 3.2 per cent shrinkage in 1982.

Previously, Giroux estimated the economy could shrink by 12 per cent in 2020.

The Liberals have been under pressure from opposition parties to release a fiscal update or a full 2020 budget. The government had originally planned to release a budget in late March but shelved it when COVID-19 hit.

Since then, MPs have approved massive emergency spending on aid to Canadians who have lost their jobs or had their hours slashed, and financing to businesses shuttered due to public health restrictions.

The latest figures from the Finance Department peg the total package of pandemic-related aid at $153.7 billion in direct spending, but Giroux estimates the price tag will be closer to $169 billion at this point.

That’s about half what the federal government spends in a normal year.

The budget office now estimates the $2,000-a-month CERB will cost the government $61.1 billion — just above the $60 billion budgeted by the government as demand soared — but pull $7.7 billion back in when recipients are taxed on the income next year.

When the Finance Department increased the estimated cost of the CERB, it also lowered the cost for a wage-subsidy program for private employers from to $45 billion from $73 billion based on the take-up rate among businesses.

Watch: Last month, Trudeau said the government would look into fraudulent CERB claims, if necessary. Story continues below.

 

Giroux’s office estimates the wage subsidy to cost the treasury $55.6 billion, though it warns the figure depends heavily on how businesses respond as they’re allowed to reopen.

In a speech Thursday, a senior Bank of Canada official noted that federal spending measures should continue to buffer income losses and support household spending during the early stages of the economic recovery.

Deputy governor Lawrence Schembri in a videoconference speech said that a forthcoming survey of consumer expectations will show that respondents receiving federal support have spent or expect to spend on average 70 per cent of their benefits.

The text of his speech released by the bank notes that recent data indicate a recovery is underway, with a first phase being sharp and short, followed by a longer “recuperation” period influenced by the course of the pandemic.

This report by The Canadian Press was first published June 18, 2020.

Purchasing a house in Canada is tricky at the best of times, but getting into the property market for the first time is especially tough. To help with some of the costs of buying your initial home, there exists a range of programs for eligible first-time homebuyers. It’s a good idea to learn about these programs to avoid leaving money on the table.

These are the five biggest first-time homebuyer programs in Canada. Some aren’t available in every province, so we’ve noted where that’s the case.

1. Land transfer tax rebates

One of the largest closing costs when purchasing a home is the land transfer tax, which is charged in every province except Alberta and Saskatchewan. The City of Toronto also charges a land transfer tax on top of the Ontario tax. Land transfer tax rates are generally between 0.5 and 3.0 per cent of the home purchase price.

To help manage the cost of land transfer tax, Ontario, British Columbia, Prince Edward Island, and the City of Toronto offer rebates for first-time homebuyers. These programs reimburse some, or all, of your land transfer taxes. Each location has a maximum rebate, listed below:

• City of Toronto: $4,475
• Ontario: $4,000
• British Columbia: $8,000
• Prince Edward Island: $2,000

If you’re buying the home with someone who is not a first-time homebuyer, this may prevent you from qualifying for some, or all, of the rebate. Different eligibility rules apply for each location. Some governments require that you’ve lived in the province for a certain amount of time to claim the rebate. Others require that your home’s property value be less than a certain amount. Check your government’s website for exact qualification requirements in your location. 

2. The Home Buyers’ Tax Credit

The Home Buyers’ Tax Credit (also referred to as The Home Buyer’s Amount) lets first-time homebuyers claim $5,000 of a property purchase on their tax return. With current tax rates, that results in a $750 rebate.

You’ll need to claim this credit on your tax return in the year you buy the property. You can split the credit between two returns for joint purchases, but the overall claim can’t exceed $5,000. 

RELATED

• Canadian Mortgage Rates Hit Lowest Levels Ever

• Should You Use A Broker Or A Bank When Getting A Mortgage Loan?

• A Mortgage Pre-Approval Could Save You Stress When You’re Buying A Home

• Fixed Or Variable? How To Decide Which Mortgage Is Right For You

3. GST/HST New Housing Rebate

When you purchase a newly built house, construct a new house, or make substantial renovations to your existing home, you’ll be charged GST or HST. The GST/HST New Housing Rebate reimburses a portion of this.

This rebate isn’t exclusive to first-time homebuyers, but many first-time buyers use it when purchasing a new home. Eligibility and rebate amounts depend on the province your home is located in. You can claim the rebate within two years of buying your new house, or from when construction was completed.

4. The Home Buyers’ Plan

The Home Buyers’ Plan (HBP) is not a credit. Instead, it’s a way for you to increase your down payment with money from a Registered Retirement Savings Plan (RRSP), thus increasing how much mortgage you can afford.

First-time homebuyers can withdraw up to $35,000 from an RRSP, but it’ll need to be repaid (on a non-deductible basis) within 15 years to avoid a penalty. Any amount withdrawn needs to have been in the RRSP for at least 90 days – if not, those contributions may not be tax-deductible.

It’s important to consider the long-term financial implications of this program. While borrowing from your RRSP can increase what you can afford today, you may sacrifice outsized returns that could have come from maintaining your RRSP.

5. The First Time Home Buyer Incentive

This program is also not a rebate. Rather, the First-Time Home Buyer Incentive is a shared-equity mortgage with the Canadian government. With this program, the government takes a 5 to 10 per cent stake in your home, with you retaining exclusive access.

This lets you buy a home with a smaller deposit and lowers your monthly mortgage payments. The government contribution needs to be repaid within 25 years, based on the home’s market price at the time the incentive is paid back. This means that if your home’s value goes up, then the government also benefits from the increase. The same is true should your home’s value decrease. If the home is sold before the contribution is repaid, the government receives its applicable share from the sale.

This program is interesting, but it doesn’t suit everyone. Firstly, not all homebuyers will want a shared-equity mortgage. Secondly, the incentive has some very specific eligibility criteria, which limit the types of buyers the incentive is useful for. 

READ MORE

• CMHC’s New Rules Cut Maximum Home Purchase Price Up To 12%: Experts
• Rich Torontonians Eyeing An Exodus From City After Pandemic: Agency
• Canadian Homebuyers Face ‘Debt Cliff’ This Autumn, CMHC Warns
• Forced Selling May Be Headed For Canada's Housing Market

Are you a first-time homebuyer?

To be eligible for most of these programs, you’ll need to be considered a first-time homebuyer. Keep in mind that some programs have additional eligibility factors. Check with your local government or a local mortgage professional to be sure.

Here are some key factors that could affect your eligibility as a first-time homebuyer:

First-time homebuyers: You’re generally considered a first-time homebuyer if you have not previously had any ownership stake in a home at any time. However, for federal government programs, you can qualify as a first-time homebuyer so long as you have not occupied a home that you (or your spouse or common-law partner) own in the year of your new home purchase and the four years prior.

Owner-occupied: The property you’re buying generally needs to be your main residence. Exact rules vary, but you’ll typically need to move in shortly after purchase.

Residential status: You’ll need to be a resident of Canada to apply for most first-time homebuyer programs. Some programs also require you to be a permanent resident or Canadian citizen. Moreover, some programs and provinces require you to have lived in a province for a certain time period.

Co-buying: If you’re a first-time homebuyer but your buying partner isn’t, you may only be able to claim a portion of a program.

People with disabilities: There are special rules and additional rebates for people with disabilities. Many first-time homebuyer programs can be claimed by people with a disability multiple times, subject to certain conditions.

The bottom line

As a first-time homebuyer in the 21st century, you’ll want every bit of help you can get. The programs available in Canada go a long way towards making buying a home easier and more affordable.

If you need more information or advice, it could be worth speaking to a mortgage professional such as a mortgage broker. Along with providing advice, mortgage brokers can often find you better mortgage deals than you would have found yourself. 

For more government resources, check out the links below:

• Land Transfer Tax Rebates: Ontario, B.C., P.E.I., Toronto
• The Home Buyers’ Tax Credit
• GST/HST New Housing Rebate
• Home Buyer’s Plan
• First-Time Home Buyer Incentive

AlloCiné a rencontré sur la Croisette Kirsten Dunst (lauréate du Prix d’interprétation) et Charlotte Gainsbourg, les deux héroïnes de “Melancholia”, un des films-phares du Festival de Cannes (et de l’année cinéma…) ainsi que le réalisateur Lars Von Trier.

Melancholia de Lars von Trier, avec Kirsten Dunst, Charlotte Gainsbourg, Kiefer Sutherland, John Hurt, Charlotte Rampling, Stellan Skarsgard, Alexander Skarsgård… : Sortie le 10 août 2011

OTTAWA — The prices Canadians have reported paying for goods and services have been rising more than the official inflation rate, a senior Bank of Canada official says.

Deputy governor Lawrence Schembri made the comment in a video conference speech Thursday to the Greater Saskatoon Chamber of Commerce, where he provides a glimpse at the bank’s survey of consumer expectations to be released next month.

A note in his speech says that while this discrepancy between perceived prices and inflation rates isn’t new, the difference between households’ perceptions in the second quarter of 2020 and April’s inflation reading was “particularly acute.”

On Wednesday, Statistics Canada reported that the annual pace of inflation fell 0.4 per cent in May, marking the second consecutive month for negative inflation after a 0.2 per cent drop for April.

The drop is mostly due to demand-driven declines in the prices of gasoline, traveller accommodation, and clothing and footwear. On the other hand, price pressures on rice, toilet paper and household cleaning products reflect shifting consumer demands, Schembri said.

What households have felt is spending far less on items whose prices are dropping, he said, while spending more on items whose prices are rising.

Schembri said the central bank will be paying close attention to spending as restrictions due to the pandemic ease because household spending and spending on housing usually account for two-thirds of economic activity.

Uncertainty about the future “points toward a recovery that will be gradual and long-lasting as this uncertainty slowly dissipates and household confidence is restored,” reads the text of his speech released by the bank.

“In the meantime, households are likely to remain cautious in their spending behaviour as they adjust to a new ‘post-pandemic’ normal.”

Consumption dropped dramatically during the pandemic — a nine per cent year-over-year drop during the first quarter of 2020 — as businesses closed up and workers asked to stay at home to slow the spread of COVID-19.

RELATED

• Canada’s Deficit Could Swell To $256 Billion: PBO Report
• COVID-19's Economic Divide: House Prices Jump As Rental Market Tanks
• Canadian Mortgage Rates Hit Lowest Levels Ever

Over the same time period, the Bank of Canada has embarked on an unprecedented bond purchasing program to ease the flow of credit in financial markets, and dropped its policy interest rate to its effective lower bound of 0.25 per cent.

Schembri said the drop of 150 basis points to the rate has been passed through to consumer interest rates to varying degrees. Since March 4, rates on fixed and variable-rate mortgages have dropped between 20 and 75 points, while rates on lines of credit have declined by 100 points or more.

As well, banks have allowed more than 700,000 households to delay mortgage payments for up to six months, and deferred payments on other lines of credit.

Still, Schembri’s speech says some vulnerable households are likely to fall behind on their loan payments if incomes don’t recover by the end of the deferral period.

For those who can pay, they’ll face small, or modest, increases in ongoing monthly payments and live with their existing debt for longer, a note in his speech says.

This report by The Canadian Press was first published June 18, 2020.

Purchasing a house in Canada is tricky at the best of times, but getting into the property market for the first time is especially tough. To help with some of the costs of buying your initial home, there exists a range of programs for eligible first-time homebuyers. It’s a good idea to learn about these programs to avoid leaving money on the table.

These are the five biggest first-time homebuyer programs in Canada. Some aren’t available in every province, so we’ve noted where that’s the case.

1. Land transfer tax rebates

One of the largest closing costs when purchasing a home is the land transfer tax, which is charged in every province except Alberta and Saskatchewan. The City of Toronto also charges a land transfer tax on top of the Ontario tax. Land transfer tax rates are generally between 0.5 and 3.0 per cent of the home purchase price.

To help manage the cost of land transfer tax, Ontario, British Columbia, Prince Edward Island, and the City of Toronto offer rebates for first-time homebuyers. These programs reimburse some, or all, of your land transfer taxes. Each location has a maximum rebate, listed below:

• City of Toronto: $4,475
• Ontario: $4,000
• British Columbia: $8,000
• Prince Edward Island: $2,000

If you’re buying the home with someone who is not a first-time homebuyer, this may prevent you from qualifying for some, or all, of the rebate. Different eligibility rules apply for each location. Some governments require that you’ve lived in the province for a certain amount of time to claim the rebate. Others require that your home’s property value be less than a certain amount. Check your government’s website for exact qualification requirements in your location. 

2. The Home Buyers’ Tax Credit

The Home Buyers’ Tax Credit (also referred to as The Home Buyer’s Amount) lets first-time homebuyers claim $5,000 of a property purchase on their tax return. With current tax rates, that results in a $750 rebate.

You’ll need to claim this credit on your tax return in the year you buy the property. You can split the credit between two returns for joint purchases, but the overall claim can’t exceed $5,000. 

RELATED

• Canadian Mortgage Rates Hit Lowest Levels Ever

• Should You Use A Broker Or A Bank When Getting A Mortgage Loan?

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3. GST/HST New Housing Rebate

When you purchase a newly built house, construct a new house, or make substantial renovations to your existing home, you’ll be charged GST or HST. The GST/HST New Housing Rebate reimburses a portion of this.

This rebate isn’t exclusive to first-time homebuyers, but many first-time buyers use it when purchasing a new home. Eligibility and rebate amounts depend on the province your home is located in. You can claim the rebate within two years of buying your new house, or from when construction was completed.

4. The Home Buyers’ Plan

The Home Buyers’ Plan (HBP) is not a credit. Instead, it’s a way for you to increase your down payment with money from a Registered Retirement Savings Plan (RRSP), thus increasing how much mortgage you can afford.

First-time homebuyers can withdraw up to $35,000 from an RRSP, but it’ll need to be repaid (on a non-deductible basis) within 15 years to avoid a penalty. Any amount withdrawn needs to have been in the RRSP for at least 90 days – if not, those contributions may not be tax-deductible.

It’s important to consider the long-term financial implications of this program. While borrowing from your RRSP can increase what you can afford today, you may sacrifice outsized returns that could have come from maintaining your RRSP.

5. The First Time Home Buyer Incentive

This program is also not a rebate. Rather, the First-Time Home Buyer Incentive is a shared-equity mortgage with the Canadian government. With this program, the government takes a 5 to 10 per cent stake in your home, with you retaining exclusive access.

This lets you buy a home with a smaller deposit and lowers your monthly mortgage payments. The government contribution needs to be repaid within 25 years, based on the home’s market price at the time the incentive is paid back. This means that if your home’s value goes up, then the government also benefits from the increase. The same is true should your home’s value decrease. If the home is sold before the contribution is repaid, the government receives its applicable share from the sale.

This program is interesting, but it doesn’t suit everyone. Firstly, not all homebuyers will want a shared-equity mortgage. Secondly, the incentive has some very specific eligibility criteria, which limit the types of buyers the incentive is useful for. 

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Are you a first-time homebuyer?

To be eligible for most of these programs, you’ll need to be considered a first-time homebuyer. Keep in mind that some programs have additional eligibility factors. Check with your local government or a local mortgage professional to be sure.

Here are some key factors that could affect your eligibility as a first-time homebuyer:

First-time homebuyers: You’re generally considered a first-time homebuyer if you have not previously had any ownership stake in a home at any time. However, for federal government programs, you can qualify as a first-time homebuyer so long as you have not occupied a home that you (or your spouse or common-law partner) own in the year of your new home purchase and the four years prior.

Owner-occupied: The property you’re buying generally needs to be your main residence. Exact rules vary, but you’ll typically need to move in shortly after purchase.

Residential status: You’ll need to be a resident of Canada to apply for most first-time homebuyer programs. Some programs also require you to be a permanent resident or Canadian citizen. Moreover, some programs and provinces require you to have lived in a province for a certain time period.

Co-buying: If you’re a first-time homebuyer but your buying partner isn’t, you may only be able to claim a portion of a program.

People with disabilities: There are special rules and additional rebates for people with disabilities. Many first-time homebuyer programs can be claimed by people with a disability multiple times, subject to certain conditions.

The bottom line

As a first-time homebuyer in the 21st century, you’ll want every bit of help you can get. The programs available in Canada go a long way towards making buying a home easier and more affordable.

If you need more information or advice, it could be worth speaking to a mortgage professional such as a mortgage broker. Along with providing advice, mortgage brokers can often find you better mortgage deals than you would have found yourself. 

For more government resources, check out the links below:

• Land Transfer Tax Rebates: Ontario, B.C., P.E.I., Toronto
• The Home Buyers’ Tax Credit
• GST/HST New Housing Rebate
• Home Buyer’s Plan
• First-Time Home Buyer Incentive