Ontario First-Time Home Buyer Guide

First-time home buyers in Ontario are waging a perpetual uphill battle. The cost of living is high, housing supply is low and home prices remain some of the highest in Canada. In 2024, the provincial average home price exceeded $865,000 in 2024, while the average price in Toronto was more than $1,000,000.

Buying your first home in Ontario isn’t easy, but there are strategies and assistance programs that can help you succeed.

Who is a first-time home buyer in Ontario?

Being a “first-time home buyer” in Ontario has a specific meaning if you plan to use government assistance programs. It usually means you have never owned a home, though there are exceptions, such as:

First-time home buyer programs in Ontario

Programs that provide financial assistance to first-time buyers in Ontario aren’t likely to be game-changers for most buyers struggling with affordability, but they can help chip away at the overall cost of being a homeowner.

To qualify for first-time home buyer assistance, your income often needs to be below a certain amount, which varies by location and program.

Ontario Land Transfer Tax Refund

Eligible first-time home buyers can get a refund of the provincial land transfer tax — an otherwise standard closing cost. Buyers won’t pay any tax for homes worth less than $368,000. Homes with a higher value can result in refunds of up to $4,000.

To qualify, you must:

» MORE: Crunch the numbers with our land transfer tax and fee calculator.

First-Time Purchaser Rebate (Toronto only)

First-time buyers in Toronto can avoid some or all of the municipal land transfer tax.

The requirements for Ontario’s provincial rebate program apply to this municipal rebate as well. The maximum refund is $4,475.

If you qualify for both the Ontario and Toronto rebates, you could shave up to $8,475.

Local Homeownership Programs

The following initiatives run by Ontario municipalities aren’t specifically for first-time buyers, but may still assist eligible buyers.

The Region of Waterloo (includes Kitchener and Cambridge)

Simcoe County

Kingston or the surrounding County of Frontenac

Chatham-Kent

Brantford

Dufferin County

District of Muskoka

Federal assistance programs for first-time home buyers in Ontario

The Home Buyers’ Plan

Summary: Make tax-free withdrawals from eligible registered retirement savings plan, or RRSPs. Repay the funds within 15 years.

How much: Up to $60,000.

Eligibility requirements include:

If the HBP won’t work for you, there are a few more federal first-time home buyer grant and assistance programs worth investigating, including an easy-to-claim tax credit.

The First Home Savings Account

Summary: The First-Home Savings Account offers tax advantages similar to an RRSP or TFSA. Your deposits are tax-deductible, and any returns generated by the investments in your account are tax-free.

How much: Deposit up to $8,000 annually, up to a maximum of $40,000.

First-Time Home Buyers’ Tax Credit

Summary: The First-Time Home Buyers’ Tax Credit, also known as the Home Buyers’ Amount, is a non-refundable credit.

How much: $10,000 credit for first-time home buyers. It results in a tax rebate of up to $1,500.

GST/HST New Housing rebate

Summary: If you purchase or build a new house, or significantly renovate your primary residence, you could recoup some of the Goods and Services Tax (GST), or the federal portion of the Harmonized Sales Tax (HST), that you paid.

Eligibility requirements: Different rules apply depending on property type and location, so make sure the new home you have your eye on is eligible for a rebate.

Approaching the Ontario housing market as a first-time home buyer

Low housing supply means higher prices

At the end of December 2024, there were 43,779 active residential listings in Ontario, according to the Ontario Real Estate Association. While that represents the highest level of housing supply for the month in a decade, it’s hard for prices to fall quickly when 44,000 listings are serving a province of 15 million people.

The average price in December — $834,123 — is still out of reach for many first-time buyers.

Prices that high can be doubly scary with mortgage rates remaining higher than they’ve been in years.

Understand your local market

Real estate news often focuses on national or regional trends, but you’re not buying a trend: You’re buying a particular home in a particular city in Ontario.

It’s worth reaching out to an experienced, full-time real estate agent who specializes in the area of the province where you’d like to own your first home.

An agent who has a sense of your goals and spending limits will look at recent sales activity and help you understand the nuances of the market you’re in, including whether it has growth potential and whether you should expect to pay more than the asking price.

Good agents won’t sugar-coat the situation you’re facing, nor will they pressure you to bid on a home if you have no reasonable chance of winning. Their job is to help you feel prepared, both emotionally and strategically, to buy your first home.

Getting your first mortgage

Down payments in Ontario

Canada’s mortgage lending rules require buyers to provide at least a 5% down payment on homes that cost less than $500,000. Most homes in Ontario cost more than that, so your down payment will likely require 5% of the first $500,000 and 10% of the amount between $500,000 and $1.5 million.

Getting pre-approved for a mortgage

In addition to saving, it’s a good idea to speak to your mortgage lender or mortgage broker early in your home buying journey to find out how large a mortgage you’ll be able to borrow.

This process is called a mortgage pre-approval, and involves a lender taking into account your income, savings and debts to determine how much house you’ll be able to buy..

Where can you get a mortgage in Ontario?

You can apply for a mortgage directly with a Big Six bank, credit union or certain financial service companies in Ontario.

Some lenders, however, don’t allow direct applications, so borrowing from one of them will mean tagging in a mortgage broker. There are plenty of brokers to choose from in Ontario.

Brokers can suggest strategies to strengthen your overall finances before applying for a loan. They generally offer more loan options than a traditional bank, which can be especially helpful for first-time home buyers.

» TRY IT: To get an estimate of what your home buying budget is right now, use a mortgage affordability calculator.

The bottom line for first-time home buyers in Ontario

There’s a lot of frustration, and even anger, among first-time home buyers in Ontario, who feel like home ownership in the province is becoming unattainable.

It’s undoubtedly hard, but you won’t know what’s possible until you give it a shot. To get started, follow these tried and true first-time home buyer tips:

And don’t take it personally if the market doesn’t cooperate. There’s nothing wrong with delaying your plans until buying a home fits more comfortably in your budget.