First-Time Home Buyer Guide Canada 2026
Everything Canadian first-time buyers need to know — government programs, down payment minimums, and the step-by-step path from saving to closing day.
Canadian First-Time Buyer Programs in 2026
The FHSA combines the best of an RRSP and a TFSA. Contributions are tax-deductible (like an RRSP) and withdrawals for a qualifying first home purchase are completely tax-free (like a TFSA).
- Contribute up to $8,000 per year
- Lifetime contribution limit of $40,000
- Funds grow tax-free while invested
- Must be used within 15 years of opening or converted to an RRSP
- You must be a Canadian resident, aged 18–71, and not have owned a home in the current or four preceding years
The HBP lets you withdraw funds from your RRSP without immediate tax consequences, as long as you repay the amount over the following 15 years.
- Withdraw up to $60,000 per person (raised from $35,000 in 2024)
- Couples can combine for up to $120,000
- Repayments begin in year 2 after withdrawal and continue over 15 years
- Funds must be in your RRSP for at least 90 days before withdrawal
- Can be combined with the FHSA for maximum buying power
The HBTC provides a non-refundable tax credit worth up to $1,500 when you file your taxes the year you bought your first home.
- Federal tax credit of $10,000 × 15% = $1,500
- Claim on your tax return for the year of purchase
- Both spouses can split the credit if both qualify
- Applies to qualifying homes including condos, townhouses, and detached
Many provinces and municipalities offer rebates of provincial land transfer tax for qualifying first-time buyers.
- Ontario: Up to $4,000 rebate on the provincial LTT
- Toronto: Additional rebate up to $4,475 on municipal LTT
- British Columbia: Property Transfer Tax exemption on homes up to $500,000
- Prince Edward Island: Full exemption from the real property transfer tax
- Check your specific province for current rebate amounts and qualifying conditions
| Purchase Price | Minimum Down Payment | Example |
|---|---|---|
| Up to $500,000 | 5% of purchase price | $400,000 home = $20,000 down |
| $500,000 to $1,499,999 | 5% on first $500K, 10% on the rest | $800,000 home = $25,000 + $30,000 = $55,000 down |
| $1,500,000 and above | 20% of total purchase price | $1,500,000 home = $300,000 down (no CMHC insurance available) |
Note: In December 2024 the federal government raised the insured mortgage cap from $1M to $1.5M, expanding access to high-ratio insured mortgages for first-time buyers in expensive markets.
The First-Time Buyer Roadmap
Check Your Credit Score
Aim for 680+ for the best mortgage rates. Pull your free credit report from Equifax or TransUnion and dispute any errors before applying.
Save Your Down Payment + Closing Costs
Plan for 1.5–4% extra on top of your down payment for closing costs: legal fees, land transfer tax, title insurance, home inspection, and moving expenses.
Get Pre-Approved for a Mortgage
A mortgage pre-approval locks in your rate for 90–120 days and tells you exactly what you can afford. Pre-approval is free and doesn't commit you to that lender.
Find a Real Estate Agent (Buyer's Agent)
In Canada, the seller typically pays both agents' commissions — your buyer's agent works for you at no cost. Interview 2–3 agents before committing.
Shop, Tour, and Make an Offer
Your offer should include conditions for financing approval, home inspection, and status certificate review (for condos). Standard conditions periods are 5–10 days.
Firm Up the Mortgage
Once your offer is accepted, your lender will require a final appraisal, proof of down payment, and updated employment confirmation before issuing a commitment letter.
Closing Day
Your lawyer handles the legal transfer. You'll sign your mortgage documents, pay the balance of your down payment and closing costs, and receive the keys.
- Spending your maximum pre-approval amount. Pre-approval is a ceiling, not a target. Aim for 70–80% of your max so you have breathing room for unexpected costs and lifestyle flexibility.
- Ignoring closing costs. Closing costs typically add 1.5–4% to your purchase price. On a $500,000 home, that's $7,500–$20,000 you need on top of your down payment.
- Changing jobs or making big purchases during the mortgage process. Lenders re-verify employment and credit before closing. A new car loan or job change can derail your approval.
- Skipping the home inspection. A $400–$600 inspection can save you from a $40,000 surprise. Never waive the inspection condition in a competitive market without knowing the risks.
- Forgetting about ongoing costs. Property taxes, home insurance, utilities, condo fees, and maintenance reserves add hundreds to thousands per month beyond your mortgage payment.
Related guides
Ready to See What You Can Afford?
Use our calculators to model your monthly payment and check your buying power with the Canadian stress test.