First-time home buyer guide for Toronto.
Everything a first-time buyer in Toronto and the GTA needs: down payment minimums, the stress test, land transfer tax rebates, government programs, closing costs, and the approval steps from pre-approval to keys.
How much do you actually need down?
Canada's minimum down payment is tiered. You need 5% on the first $500,000 of the purchase price, 10% on the portion from $500,000 to $1,500,000, and 20% on any home priced above $1,500,000. On a $800,000 Toronto property that works out to $55,000 - $25,000 on the first $500,000 plus $30,000 on the remaining $300,000.
With less than 20% down your mortgage must be insured through CMHC, Sagen, or Canada Guaranty. The premium is added to your mortgage balance rather than paid up front, and insured mortgages often carry lower interest rates than uninsured ones.
Down payment
5% to 20%+ depending on purchase price
CMHC insurance
Required under 20% down; added to the mortgage
Ontario land transfer tax
Rebate up to $4,000 for first-time buyers
Toronto land transfer tax
Rebate up to $4,475 for first-time buyers
Legal fees & disbursements
Typically $1,500 to $2,500
Home inspection / status certificate
$400 to $700
Your path from pre-approval to keys.
1. Get a real pre-approval
Not a rate-check calculator. A pre-approval reviews your income, credit, and down payment so you shop with a firm budget and a rate hold of up to 120 days.
2. Build your down payment and closing costs
Budget 1.5% to 4% of the purchase price for closing costs on top of your down payment: land transfer tax, legal fees, title insurance, home inspection, and adjustments.
3. Choose the right neighbourhood and property type
Condos, freehold, and multi-unit all qualify differently. Condo fees, heating costs, and property taxes all reduce how much you can borrow, so we run the numbers before you fall in love with a listing.
4. Make your offer with financing certainty
In competitive GTA markets you may need a short or no financing condition. We tell you honestly what risk you are taking and how quickly we can confirm the file.
5. Submit documents and get approved
Letter of employment, pay stubs, notices of assessment, down payment history, and the agreement of purchase and sale. We package it once and shop it to multiple lenders.
6. Close with your lawyer
The lender sends instructions to your lawyer, you sign, funds transfer, and you get the keys. We stay on the file until closing day.
Money first-time buyers leave on the table.
Toronto buyers pay land transfer tax twice - once to Ontario and once to the City of Toronto. As a first-time buyer you can claim up to $4,000 back provincially and up to $4,475 municipally, which often erases most of the bill on a condo purchase.
On the savings side, the First Home Savings Account (FHSA) lets you contribute up to $8,000 a year to a $40,000 lifetime maximum with a tax deduction going in and no tax coming out. The Home Buyers' Plan lets you withdraw up to $60,000 per person from an RRSP tax-free toward your purchase. Both can be combined.
Before you shop, have this ready
- Letter of employment and two recent pay stubs
- Two years of T4s and notices of assessment
- 90-day history of your down payment funds
- Photo ID and current address history
- List of debts: car loans, lines of credit, student loans
- Gift letter if a family member is helping with the down payment
First-time buyer questions.
- How much down payment do I need to buy a home in Toronto?
- In Canada the minimum is 5% on the first $500,000, 10% on the portion between $500,000 and $1,500,000, and 20% on homes priced above $1,500,000. Anything under 20% requires default (CMHC) mortgage insurance, which is added to your mortgage balance.
- What credit score do first-time buyers in Toronto need?
- Most A-lenders look for a score of 680 or higher for insured financing, though approvals happen below that with strong income and down payment. Credit unions and alternative lenders consider lower scores at slightly higher rates.
- What is the mortgage stress test and how does it affect me?
- You must qualify at the greater of your contract rate plus 2% or 5.25%. That means your approved purchase price is based on a higher payment than you will actually make, which protects you if rates rise at renewal.
- What first-time buyer programs can I use in Toronto?
- The Home Buyers' Plan lets you withdraw up to $60,000 per person from your RRSP tax-free, the First Home Savings Account (FHSA) allows up to $40,000 in deductible savings, and there is a federal Home Buyers' Tax Credit. Toronto and Ontario also offer land transfer tax rebates for eligible first-time buyers.
- How much land transfer tax will I pay in Toronto?
- Toronto buyers pay both Ontario and municipal Toronto land transfer tax. First-time buyers can claim up to $4,000 back provincially and up to $4,475 municipally, which for many condo purchases eliminates most of the bill.
- How long does it take to get a mortgage approved?
- A pre-approval can be issued within a day once we have your income and credit documents. Full approval on an accepted offer usually takes two to five business days depending on the lender and the property.
Helpful for first-time buyers
Valuation, moving day, and the employment paperwork lenders look at - all part of a first purchase in Toronto.
- Toronto home valuation serviceFree property valuations for Toronto and GTA homeowners - useful before a refinance, equity take-out, or renewal so you know the value your lender will be working from.
- Toronto moversResidential and commercial movers across Toronto and the GTA for the closing-day side of a purchase once your mortgage funds.
- Toronto resume writing servicesProfessional resume and career services - stable, documented employment income is one of the things every mortgage lender underwrites.