First-Time Home Buyer Guide for Canada 2025: Everything You Need to Know
Complete first-time home buyer guide for Canada 2025. Learn about down payments, mortgage pre-approval, closing costs, and CMHC insurance.
Buying your first home in Canada is one of the most significant financial decisions you'll ever make. This guide walks through each step and names the official source for every government rule it quotes.
Down Payment Requirements
The federal government sets the minimum down payment by purchase price. These are the tiers published by the Financial Consumer Agency of Canada, as of October 2026:
Example: $25,000 on $500,000
5% of the first $500,000, 10% of the rest
Example: $45,000 on $700,000
Example: $300,000 on $1.5 million
Source: Financial Consumer Agency of Canada, "Down payment". These tiers have changed before, so check that page before you rely on them.
CMHC Mortgage Default Insurance
If your down payment is less than 20%, you'll need to purchase mortgage default insurance through CMHC (Canada Mortgage and Housing Corporation), Sagen, or Canada Guaranty.
Example: on a $500,000 home with 5% down ($25,000), the loan is $475,000 and the CMHC premium at 4.00% is $19,000, which can be added to your mortgage.
Source: CMHC, "CMHC Mortgage Loan Insurance Cost". The premium is a percentage of the loan. CMHC notes that premiums in Quebec, Ontario and Saskatchewan are subject to provincial sales tax, which cannot be added to the loan. Sagen and Canada Guaranty publish their own rates.
Closing Costs to Budget For
Beyond your down payment, CMHC advises budgeting for closing costs (for example, legal and land transfer fees) equal to 1.5% to 4% of the purchase price. The items below are the usual ones. We quote no dollar range for each, because they vary by province, property and provider.
At CMHC's 1.5% to 4%, that is $7,500 to $20,000 on a $500,000 home.
Source: CMHC, general requirements for homeowner mortgage loan insurance.
Federal Programs
Closed. CMHC states that the program is no longer accepting applications. The deadline for new submissions was March 21, 2024.
Withdraw up to $60,000 from your RRSP to buy or build a qualifying home (Canada Revenue Agency limit, as of October 2026). You repay it to your RRSP over 15 years. The CRA sets out when repayments start.
The home buyers' amount: a non-refundable federal credit claimed on up to $10,000 for a qualifying home bought in 2025 (Canada Revenue Agency, line 31270). Check the CRA page for the year you buy.
A partial GST rebate on a new or substantially renovated home, up to $6,300, reduced above $350,000 and not available at $450,000 or more (CRA guide RC4028). Separately, the CRA lists a first-time home buyers' GST/HST rebate with applications open as of October 2026: it describes a rebate of 100% of the GST (or the federal part of the HST) on a new home valued up to $1 million, reduced between $1 million and $1.5 million. Check the CRA page for eligibility before you rely on either.
Program limits change. Each figure in this section names the body that sets it, checked in October 2026. Confirm on that body's own site before you rely on it.
Provincial Programs
Land transfer tax refund for first-time homebuyers of up to $4,000 (Ontario Ministry of Finance). Toronto's municipal land transfer tax has its own first-time purchaser rebate of up to $4,475 (City of Toronto). Both as of October 2026.
First time home buyers' program: a property transfer tax exemption on the first $500,000 of a home with a fair market value of $835,000 or less, and a partial exemption below $860,000, for purchases from April 1, 2024 (Government of British Columbia, as of October 2026).
No land transfer tax of the kind Ontario and B.C. charge. Alberta charges land titles registration fees instead: $50 plus $5 per $5,000 of the property's value on the transfer, and the same on the mortgage principal (Government of Alberta, Land Titles fee schedule effective October 1, 2026).
Some municipalities run their own programs, such as the City of Québec's Accès Famille. Amounts and eligibility differ, so check your municipality's site and Revenu Québec.
Conclusion
Buying your first home in Canada in 2025 is an achievable goal with proper planning, expert guidance, and financial discipline. By understanding down payment requirements, leveraging first-time buyer incentives, and working with knowledgeable real estate professionals, you can navigate the process with confidence.
This guide makes no market or interest rate forecast. For current conditions, see the Bank of Canada for the policy rate, CMHC for its Housing Market Outlook and the Canadian Real Estate Association for national sales and price statistics.
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Market conditions move, and this page has not been revised since. Treat the figures and outlook as a snapshot of that date rather than today’s market, and check a current source before advising a client.