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<\/h2>\nDown payment requirements for first-time buyers<\/h2>\n
For most first-time home buyers, the biggest hurdle is usually saving for the down payment.<\/p>\n
In Canada, home buyers must put down at least 5% of the purchase price<\/a> for homes purchased that are less than $500,000. For homes between $500,000 and $1.5 million, the minimum down payment increases to 10% for the portion above the first $500,000. For properties above $1.5 million, the minimum down payment is 20% of the purchase price.<\/p>\n If your down payment is less than 20% of the price of your new home, you\u2019ll also have to get an insured mortgage, which can add anywhere from another 0.6% to 4.5%<\/a> to the purchase price.<\/p>\n The amount of money you put toward your down payment can also affect the type of mortgage you get, and the interest rate you\u2019ll have to pay. In general, the larger your down payment, the less interest you\u2019ll pay on your mortgage<\/a>.<\/p>\n The Home Buyers\u2019 Plan (HBP)<\/a> is a federal program that lets eligible buyers withdraw up to $60,000 from their Registered Retirement Savings Plan (RRSP)<\/a> to put towards their down payment when they buy or build a home for themselves, or for a relative with a disability.<\/p>\n Anyone who\u2019s never owned their primary residence before, or who hasn\u2019t lived in a primary residence they (or their spouse or common-law partner) own in the last four calendar years, is eligible to take part in the program. Any amounts you withdraw don\u2019t need to be paid back into your RRSP for up to 15 years.<\/p>\n Couples can also both take part in the HBP at the same time if they buy or build a home together. This allows married or common-law first-time buyers to access up to $120,000 as a down payment on their first property.<\/p>\n The First-Time Home Buyers\u2019 Tax Credit (HBTC)<\/a> is a non-refundable credit that gives first-time buyers a rebate of up to $1,500 on their income taxes when they, or their spouse or common-law partner, buy a home in Canada.<\/p>\n Also known as the Home Buyers\u2019 Amount (HBA), the HBTC can help offset the costs of buying a whole range of eligible property types, from new and existing single-family and semi-detached homes, to condos, apartments, townhouses, housing co-ops and mobile homes.<\/p>\n For new builds, the federal government also offers a rebate on the GST\/HST<\/a> for anyone who buys a newly built or substantially renovated home as their primary place of residence. The rebate also applies when buying shares in a co-op or hiring a contractor to substantially rebuild or renovate your existing home.<\/p>\n Unfortunately, the GST\/HST rebate only applies to homes with a fair-market value of $450,000 or less. But if your new home qualifies, you can receive a rebate of 36% of the GST charged on the home, up to a maximum of $6,300.<\/p>\n The GST\/HST rebate only applies to the federal part of the HST paid on a new home. But some provinces<\/a> also offer a similar rebate on the provincial portion of the tax.<\/p>\n The elected Liberal government has pledged to introduce a tax cut on new builds<\/a> for first-time home buyers. This would apply for all new builds valued at or under $1 million.<\/p>\n The First Home Savings Account (FHSA)<\/a> is a registered savings plan that lets first-time buyers save up to $8,000 a year, tax free, to buy or build a home. For the purposes of the program, \u201cfirst-time buyers\u201d include anyone who hasn\u2019t lived in a primary residence they (or their spouse or common-law partner) own in the last four calendar years.<\/p>\n As a savings vehicle, the FHSA combines the benefits of both a Registered Retirement Savings Plan (RRSP)<\/a> and a Tax-Free Savings Account (TFSA)<\/a>.<\/p>\n Like an RRSP, contributions to your FHSA can be used as a deduction on your income taxes, to reduce the amount of tax you owe. But like a TFSA, the investments inside your FHSA also grow tax-free, so you won\u2019t have to pay any tax when you withdraw the money to buy a property.<\/p>\n Once you open a FHSA, you can contribute the maximum annual amount for up to five years. This would allow a first-time buyer to save up to a lifetime maximum of $40,000 to put towards their down payment, or up to $80,000 in the case of a married or common-law couple.<\/p>\n You can also carry forward up to $8,000 from one year to the next, and you can keep your FHSA for up to 15 years before you have to use it to buy a home.<\/p>\n First-time buyers who take advantage of both an FHSA and the Home Buyers\u2019 Plan (HBP) could withdraw up to $100,000 from their registered savings for a down payment without any tax implications. For a couple, the total amount would grow to $200,000.<\/p>\n Provincial and Territorial programs<\/b><\/p>\n Several provinces, territories and municipalities also offer their own grants, rebates, tax credits and other programs to support home buyers, including first-time buyers. This includes programs like:<\/p>\n To find out which assistance programs and incentives are available in your area, check the housing section of your provincial or territorial government website, and contact your local municipal office or speak with a REALTOR\u00ae.<\/p>\n For most first-time buyers, simply navigating your way through all these different programs can be a daunting prospect. So if there\u2019s anything you\u2019re not sure about, why not ask a REALTOR\u00ae?<\/p>\n In addition to answering your questions and pointing you towards the programs you may be eligible for, a REALTOR\u00ae can walk you through each and every step of the home buying process, and help you find a home that perfectly fits your needs, your preferences\u2014and budget.<\/p>\n You may also be interested in reading\u2026<\/p>\n If you\u2019re like most Canadians, buying a home is probably the biggest investment you\u2019ll ever make. But for first-time home buyers, just saving up enough money for the down payment can take years or even decades to accomplish. Thankfully, Canada\u2019s federal and provincial governments offer several different programs designed to support first-time home buyers by […]<\/p>\n","protected":false},"author":1,"featured_media":45067,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[23],"tags":[27,30],"coauthors":[],"class_list":["post-637","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-101","tag-house-for-families","tag-real-estate"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=\/wp\/v2\/posts\/637","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=637"}],"version-history":[{"count":3,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=\/wp\/v2\/posts\/637\/revisions"}],"predecessor-version":[{"id":45072,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=\/wp\/v2\/posts\/637\/revisions\/45072"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=\/wp\/v2\/media\/45067"}],"wp:attachment":[{"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=637"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=637"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=637"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/williamtrealestate.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcoauthors&post=637"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"](\"https:\/\/i0.wp.com\/e-realtor.ca\/wp-content\/uploads\/2025\/05\/Article_02-8.jpg?resize=840%2C480&ssl=1\")
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<\/p>\nHow a REALTOR\u00ae can help<\/h2>\n
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