First Home Buyers in
Real Estate Ontario
First Home Buyers in Ontario: What You Need to Know
As first home buyers, buying your first home is one of the most exciting and nerve-wracking steps you can take in life. So if you’re a first home buyer in Ontario, and you’re entering a fast-moving, competitive market, with the right information and a good plan, you can turn your homeownership dreams into a reality.
Because in this guide, you’ll know the costs, government incentives, market conditions, and smart buying strategies as a first-time buyer in Ontario.
1. Understand the Costs of Buying Your First Home as first home buyers
Most first home buyers in Ontario focus on the down payment but that’s just the beginning. Here’s what you need to budget for:
- Down payment: Minimum 5% of the purchase price for homes under $500,000. For homes between $500,000 and $999,999, you'll need 5% of the first $500,000 and 10% of the remaining balance.
- Land transfer tax: Ontario charges this tax based on the purchase price of your home. If you’re buying in Toronto, there’s an additional municipal land transfer tax.
- Closing costs: Legal fees, home inspection, appraisal, title insurance, and more. Estimate around 1.5% to 4% of the purchase price.
- Mortgage insurance: If your down payment is less than 20%, you’ll need to pay CMHC insurance, which protects lenders.
2. Take Advantage of First home Buyer Incentives
The government of Ontario and the federal government offer several programs to support first home buyers:
- First-Time Home Buyer Incentive (FTHBI): A shared equity program where the government lends you 5% or 10% of the home’s purchase price to reduce your mortgage.
- Home Buyers’ Plan (HBP): Withdraw up to $60,000 from your RRSPs (as of 2024 changes) tax-free to put toward your down payment.
- Land Transfer Tax Refund: First-time buyers may be eligible for a rebate of up to $4,000 on Ontario’s land transfer tax.
- First Home Savings Account (FHSA): A new savings account allowing you to contribute up to $8,000 per year, tax-free, to save for your first home.
3. Get Pre-Approved Before You Start Shopping
- Understand how much you can afford
- Lock in a mortgage rate for 90–120 days
- Look serious in the eyes of sellers and real estate agents
4. As first home buyers, Choose the Right Location
Ontario is a large province with very different markets. First home buyers often consider:
- Toronto & GTA: Competitive, higher prices, but access to jobs, transit, and long-term value
- Waterloo Region: More affordable than Toronto, growing tech and education hub
- Durham, Hamilton, and Innisfil: Popular alternatives for affordability and future growth potential
5. Work With a Real Estate Agent Who Understands First home Buyers
- Guide you through the home search and offer process
- Help you understand property value and recent sales
- Explain legal documents and timelines
- Negotiate on your behalf
As a first home buyer in Ontario, this is likely your biggest purchase to date so don’t go it alone.
