For years, one of the biggest barriers to homeownership in British Columbia has been affordability — especially for first-time buyers in high-demand markets like Abbotsford, Surrey, and nearby communities. In 2025, a major policy shift aims to address this: 30-year amortization terms are now available on insured mortgages for new construction homes purchased by first-time buyers.
While this move is intended to ease entry into the housing market, it also raises important questions about long-term cost, financial readiness, and the broader implications for the BC real estate landscape.
In this two-part blog, we’ll break down what this change means, who qualifies, how it compares to traditional mortgage structures, and what first-time buyers should consider before choosing a 30-year path.
What Is a 30-Year Amortization?
Amortization refers to the length of time you take to fully pay off your mortgage. For the past decade, insured mortgages in Canada have been capped at 25 years. This shorter term required larger monthly payments but reduced total interest costs.
As of 2025, first-time buyers purchasing a newly built home and qualifying for mortgage insurance through CMHC, Sagen, or Canada Guaranty can now opt for a 30-year amortization, allowing for:
- Lower monthly payments
- Increased maximum loan size
- More flexible cash flow during early homeownership
However, this comes at the cost of paying more interest over the life of the loan.
Why This Change Matters in BC
In regions like Surrey and Abbotsford, where detached home prices remain near or above the $850,000–$950,000 range for new builds, first-time buyers face significant challenges. Even townhomes often require $150,000+ down payments and result in monthly payments exceeding $3,000 at 2024–25 mortgage rates.
The 30-year option provides meaningful relief. Let’s break it down:
Case Example – Surrey New Build
- Price: $875,000
- Down Payment (10%): $87,500
- Insured Mortgage: $850,000 (approx. after insurance premium)
- 5-year fixed rate: 4.89%
25-Year Amortization: ~$4,935/month
30-Year Amortization: ~$4,470/month
Monthly Savings: ~$465
Annual Savings: ~$5,580
While the long-term interest paid increases, the ability to qualify for a higher mortgage and manage monthly costs more easily makes this change highly appealing to first-time buyers entering the market during a volatile economic cycle.
Who Qualifies?
To access a 30-year amortization on an insured mortgage in 2025, buyers must meet all of the following:
- Be a first-time homebuyer
- Purchase a newly built home (not resale)
- Have a down payment of less than 20% (insured mortgage)
- Pass the mortgage stress test (still in effect in 2025)
The policy does not apply to:
- Repeat buyers
- Uninsured mortgages (20%+ down payment)
- Refinances or investment properties
Need help navigating the rules? Read:
First-Time Homebuyers: How Sandhu & Sran Can Help You Secure a Mortgage in Abbotsford
The Trade-Off: Lower Payments vs. Higher Interest
The biggest appeal of a 30-year amortization is monthly affordability — but this comes at a long-term cost. For example:
- $850,000 mortgage over 25 years @ 4.89% = ~$480,000 in interest
- Same mortgage over 30 years = ~$570,000 in interest
🔹 $90,000+ in extra interest
That’s a significant price to pay for added flexibility. The key is deciding what matters more:
- Managing cash flow in the short term, or
- Saving long-term interest and building equity faster
If your income is expected to grow, the lower initial burden might make sense. But if you can manage higher payments now, the traditional 25-year route builds equity more aggressively.
Learn more:
6 Tips for Easy Mortgage Renewal in Abbotsford
Potential Market Impact in Surrey & Abbotsford
The policy shift may stimulate demand for new builds, especially in suburban areas with more inventory — such as South Surrey, Langley, Mission, and East Abbotsford.
Developers are already responding by:
- Marketing homes under the $1M threshold
- Offering tailored incentives for first-time buyers
- Working with mortgage brokers to align with the new rules
For buyers who previously couldn’t qualify for homes above ~$750K under a 25-year stress-tested model, this change could increase their budget by 7%–12%.
But more demand — especially when paired with slow supply growth — could also push prices upward, at least temporarily.
This makes timing and strategy critical. To succeed, buyers should:
- Get pre-approved under both 25- and 30-year terms
- Compare qualifying amounts, rates, and payment differences
- Weigh lifestyle needs against long-term financial impact
Want to learn more about qualification strategies?
Explore: Navigating a Mortgage Application for Quick Mortgage Approval
What About Edmonton?
In Edmonton, where average new home prices remain closer to $450,000–$550,000, the 30-year amortization may be less critical for affordability — but still helpful for:
- Young professionals or growing families
- Buyers with student loan or vehicle debt
- Households looking to preserve cash flow in uncertain economic times
Given Alberta’s strong population growth and resilient job market, this amortization option may also benefit those considering dual-income households with moderate credit.
Making the Most of 30-Year Amortization: Smart Moves for 2025 Buyers
While the new 30-year insured amortization option expands access to homeownership, it’s not a one-size-fits-all solution. To take full advantage — without overstretching financially — first-time buyers must approach the opportunity with clarity and planning.
Let’s break down how smart buyers are preparing to qualify and deciding whether the longer term aligns with their long-term goals.
Buyer Strategy 1: Get Pre-Approved for Both 25 and 30-Year Terms
Lenders often qualify buyers at different thresholds depending on the amortization term. A 30-year amortization lowers the monthly payment, which may allow you to qualify for a higher loan — but it’s still subject to the stress test.
Working with a mortgage broker to secure dual pre-approvals allows you to:
- Compare monthly payments and mortgage amounts
- Know exactly how much wiggle room you have at different amortization lengths
- Choose based on flexibility, not just eligibility
This strategy aligns well with 6 Proven Steps to Accelerate Your Residential Mortgage Closing, helping buyers avoid last-minute surprises.
Buyer Strategy 2: Align Amortization with Lifestyle Goals
The 30-year option can help reduce payment stress in the early years — especially useful if:
- You’re planning a parental leave or career shift
- You want to fund renovations or pay off student loans
- You’re buying with one income but expect a second soon
That said, if your income is stable and you’re financially prepared, you might still choose a 25-year term to build equity faster.
Tip: You can start with 30 years and make lump sum prepayments or increase regular payments later to reduce interest without refinancing.
Learn more in What Are the Costs Involved in Refinancing a Mortgage?
Buyer Strategy 3: Compare New Builds vs. Resale Carefully
The 30-year amortization is available only for new construction homes. That can steer buyers toward:
- Suburban developments in Mission, Chilliwack, and South Surrey
- Townhomes and condo presales in areas like Clayton Heights or Abbotsford East
- New duplex or infill builds in Edmonton’s established zones
But new builds may come with:
- Longer wait times
- HST/GST implications
- Limited room for negotiation compared to resale properties
For some buyers, a resale home with a 25-year mortgage might still be the better long-term value.
See: Tips for Buying Your First Home in 2024
Buyer Strategy 4: Use All Available Incentives Together
In addition to the 30-year amortization rule, first-time buyers in BC can benefit from:
- First Home Savings Account (FHSA) – save up to $40,000 tax-free
- RRSP Home Buyers’ Plan – withdraw up to $60,000 (per person)
- BC Property Transfer Tax Exemption – up to $8,000 savings on homes ≤ $835,000
- Federal First-Time Home Buyer’s Tax Credit – $1,500 at tax time
Combining these with a 30-year term can significantly ease the up-front and monthly burden of buying.
Explore this more in Tips to Purchase a New Home in Canada as a First-Time Buyer
Frequently Asked Questions (FAQ)
Q1: Does the 30-year amortization apply to resale homes?
No. As of 2025, it’s only available on newly built homes with less than 20% down and insured by CMHC, Sagen, or Canada Guaranty.
Q2: Can I choose 30 years with 20% down?
No. Once you put down 20% or more, your mortgage becomes uninsured, and current rules restrict insured 30-year terms to low-down-payment first-time buyers only.
Q3: Will I pay more interest over the life of the loan?
Yes — significantly more. But many buyers find the lower monthly cost and improved qualification worth the trade-off. You can also reduce total interest by making prepayments.
Q4: How does this affect my ability to qualify?
A longer amortization lowers your monthly obligation, which may help you pass the stress test. However, other factors like debt, credit, and income still play a major role.
Read more: Mortgage Stress Tests in 2025: What Homebuyers in BC Need to Know
Q5: Can I refinance later to a shorter term?
Yes. Many homeowners start with a longer amortization and later refinance or increase payments once their income stabilizes. Just ensure your mortgage allows prepayments or early payout without major penalties.
Final Thought: Is a 30-Year Mortgage the Right Move?
There’s no universal answer. For some, the extended amortization offers the breathing room needed to enter the market without overextending. For others, the long-term cost may outweigh the monthly savings.
That’s where guidance from a local, experienced mortgage advisor becomes essential. Sandhu & Sran Mortgages helps first-time buyers across Abbotsford, Surrey, and Edmonton make confident, informed decisions — not just about getting a mortgage, but about shaping a long-term plan for homeownership.