If you're buying your first home in Ontario, four things work in your favour: two tax-sheltered ways to save the down payment (the First Home Savings Account (FHSA) and the Registered Retirement Savings Plan (RRSP) Home Buyers' Plan), a land transfer tax refund of up to $4,000, and access to a 30-year amortization on an insured mortgage. The minimum down payment is 5% of the first $500,000 of the price and 10% of the part above that, up to $1.5 million.
According to the Canada Revenue Agency (CRA), you count as a first-time buyer for the FHSA and the Home Buyers' Plan if you haven't lived in a home that you or your spouse owned in the current year or the four calendar years before it.
The short version:
- Save the down payment, using an FHSA and the Home Buyers' Plan.
- Get pre-approved so you know your real ceiling under the stress test.
- Budget closing costs on top of the down payment.
- Make an offer on a home that fits the all-in budget.
- Close: your lawyer registers the sale and applies the land transfer tax refund.
How much do you need for a down payment?
According to Canada Mortgage and Housing Corporation (CMHC), the minimum down payment is 5% of the first $500,000 of the price, plus 10% of any part between $500,000 and $1.5 million. Homes at $1.5 million or more need 20% down.
So a $750,000 home needs $25,000 (5% of $500,000) plus $25,000 (10% of $250,000), which is $50,000.
With less than 20% down, your mortgage must be insured, through CMHC, Sagen or Canada Guaranty. The premium is usually 2.8% to 4% of the mortgage, and it can be added to your mortgage balance instead of paid upfront. Ontario's 8% sales tax on the premium can't be added, though; that's due in cash on closing.
Read the full down payment guide →
FHSA: tax-free savings for your first home
The First Home Savings Account (FHSA) is a registered account that lets you save up to $8,000 a year, to a $40,000 lifetime limit, according to the CRA. Contributions are tax-deductible like an RRSP, and withdrawals for a qualifying first home are tax-free like a TFSA.
Contribution room only starts building once the account is open, and you can carry forward at most $8,000 of unused room. Open one as early as you can, even with a small deposit. You have 15 years from opening it to buy.
Home Buyers' Plan (RRSP withdrawal)
The Home Buyers' Plan (HBP) is a federal program that lets each first-time buyer withdraw up to $60,000 from their RRSPs, tax-free, toward a home, according to the CRA. You can use it on the same purchase as an FHSA.
The Home Buyers' Plan is a loan to yourself, not free money. You repay it to your RRSP over 15 years.
Read the full Home Buyers' Plan guide →
Land transfer tax and the first-time rebate
Ontario charges land transfer tax, a provincial tax on every purchase, on a sliding scale from 0.5% to 2.5% of the price. The Ontario Ministry of Finance refunds first-time buyers up to $4,000 of it, which covers the whole tax on a home up to $368,000.
Waterloo Region has no municipal land transfer tax on top, unlike Toronto. Your lawyer usually applies the refund when the sale is registered, so you never pay that part.
Read the full land transfer tax guide and calculator →
Closing costs to budget for
Budget 1.5% to 4% of the price for closing costs, in cash, on top of your down payment. Land transfer tax is the biggest item.
The rest is legal fees and title insurance, a home inspection, adjustments for property tax or condo fees the seller prepaid, sales tax on mortgage insurance if you put down less than 20%, and moving costs.
Read the full closing costs guide →
Getting pre-approved and the stress test
A pre-approval tells you the most a lender will lend you, and it's set by the stress test, not your actual rate. You have to qualify at the higher of your contract rate plus 2% or 5.25%.
Since December 15, 2024, first-time buyers with an insured mortgage (less than 20% down) can take a 30-year amortization instead of 25 years, according to the Department of Finance Canada. That lowers the monthly payment, though you pay more interest overall.
See what you can afford with your own numbers →
What first homes cost in Waterloo Region
Most first homes in Waterloo Region are townhouses and condos. Here's the typical price of each in every city, and the minimum down payment on it.
| City | Freehold townhouse | Condo townhouse | Condo apartment |
|---|---|---|---|
| Kitchener | $628,000 $37,800 minimum down | $425,000 $21,300 minimum down | $336,000 $16,800 minimum down |
| Waterloo | $665,000 $41,500 minimum down | $470,000 $23,500 minimum down | $400,000 $20,000 minimum down |
| Cambridge | $615,000 $36,500 minimum down | $550,000 $30,000 minimum down | $370,000 $18,500 minimum down |
| Woolwich | $621,000 $37,100 minimum down | Too few sales | Too few sales |
| Wilmot | Too few sales | Too few sales | Too few sales |
| Wellesley | Too few sales | Too few sales | Too few sales |
| North Dumfries | Too few sales | Too few sales | Too few sales |
Median sold price of townhouses and condo apartments by city, and the minimum down payment on it. Medians cover the 90 days of sales ending October 26, 2026; fewer than 10 sales and we don't show a figure. How we calculate this.
Step by step: from saving to keys
- Open an FHSA now, even with a small deposit, so room starts building.
- Get pre-approved so you know your real ceiling under the stress test.
- Work out your all-in budget: down payment, closing costs and a cushion, not just the price you qualify for.
- Line up the money. FHSA and Home Buyers' Plan withdrawals each have their own form and timing, so start them a few weeks before closing.
- Shop, offer and close. Your lawyer registers the sale and applies the land transfer tax refund.
Programs and rebates at a glance
| Program | What you get | The catch |
|---|---|---|
| First Home Savings Account (FHSA) | Save up to $8,000 a year, $40,000 lifetime. Tax-deductible in, tax-free out. | Only $8,000 of unused room carries forward; 15 years to use it. |
| RRSP Home Buyers' Plan | Withdraw up to $60,000 from your RRSPs, tax-free, per person. | Has to be repaid to your RRSP over 15 years. |
| Ontario land transfer tax refund | Up to $4,000 back. | Covers the full tax only on homes up to $368,000. |
| First-Time Home Buyers' Tax Credit | $10,000 claim, worth $1,500 federally. | Claimed at tax time, after you buy. |
| 30-year insured amortization | Lower monthly payments than 25 years. | More interest over the life of the mortgage. |
A couple buying together can each use an FHSA and each use the Home Buyers' Plan, so up to $200,000 between the two programs.