(file photo/paNOW Staff)

By Alison Sandstrom

Real estate

Council to discuss financial support for first-time home buyers

Nov 27, 2019 | 5:00 PM

First time homebuyers in Prince Albert could be getting a boost from the city.

A new proposed program would help people cover the cost of down payments by contributing 2.5 per cent of the value of the residence they wish to purchase, to a maximum of $5,000.

Director of Planning and Development Services Craig Guidinger told paNOW he’s heard from financial and mortgage experts that the potential program would enable more people to enter the real estate market.

“Getting your first home, putting together that down payment is quite tough,” he said.

“Over the last number of years with all the new mortgage rules and other types on constraints I think it’s a really good time to have this type of a program.”

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Planning and development services is recommending that only five applications for down payment assistance be approved annually. The yearly cost of the program would be around $23,500 and be funded from an existing reserve dedicated to housing programs.

An initiative that provides rebates to non-profits building affordable housing units and a program that helps homeowners upgrade secondary rental suites are both funded from the same reserve.

Down payment assistance would be aimed at low-medium income individuals and families, with income cut-offs set based on census data. In order to qualify a one-person household would have to make $63,277 per year or less. The maximum income for a two-person household would be $67,496, and up to $80,152 for a household with three dependents.

The maximum value of the house to be purchased would be $187,796.

Council will decide if they want to implement the down payment assistance program at an upcoming meeting.

Councillor Terra Lennox-Zepp told paNOW she’s waiting to hear from residents before she makes up her mind on the potential program, but she has some doubts about its effectiveness.

“Is there evidence that shows that these types of programs actually increase the number of people buying homes? Or does that remain the same and this is just a small help,” she said.

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alison.sandstrom@jpbg.ca

On Twitter: @alisandstrom