Everything you need to know about buying your first home in Ontario
Step 1 — Get Pre-Approved for a Mortgage
Before you start shopping for a home, get a mortgage pre-approval. This tells you exactly how much you can borrow and shows sellers you are a serious buyer.
Contact your bank or a mortgage broker to begin
You will need proof of income, employment letter, and bank statements
Pre-approval is typically valid for 90–120 days
Getting pre-approved does not affect your credit score if done within a short window
A mortgage broker can shop multiple lenders on your behalf and often secure better rates than going directly to a bank.
Step 2 — Understand the Down Payment Requirements
In Canada, the minimum down payment depends on the purchase price of the home:
Homes $500,000 or less: Minimum 5% down payment
Homes $500,001–$1,499,999: 5% on the first $500K + 10% on the remainder
Homes $1,500,000 and over: Minimum 20% down payment required — CMHC insurance not available
If your down payment is less than 20% and the home costs under $1.5 million, you will need CMHC mortgage insurance, which is added to your mortgage principal. Premium rates range from 0.6% to 4.5% of your mortgage amount depending on your loan-to-value ratio.
Step 3 — First Time Home Buyer Incentives
As a first-time buyer in Ontario, you may be eligible for several government programs:
First Home Savings Account (FHSA): Contribute up to $8,000/year (lifetime max $40,000), tax-deductible contributions, tax-free withdrawals for your first home
RRSP Home Buyer's Plan (HBP): Withdraw up to $35,000 from your RRSP tax-free for a first home purchase (must be repaid over 15 years)
First-Time Home Buyer Tax Credit: A federal non-refundable tax credit of up to $1,500
GST/HST New Housing Rebate: If buying a newly built home, you may qualify for a partial HST rebate
Step 4 — Land Transfer Tax
When you purchase a home in Ontario, you pay a Land Transfer Tax (LTT) based on the purchase price. If you are buying in the City of Toronto, you also pay a Municipal Land Transfer Tax.
Ontario LTT on a $800,000 home: approximately $12,475
Toronto Municipal LTT (additional): approximately $11,725
First-Time Buyer Rebate: First-time buyers in Ontario receive a rebate of up to $4,000 on the provincial LTT. In Toronto, first-time buyers also receive a municipal rebate of up to $4,475 — effectively eliminating LTT on homes up to approximately $400,000.
Step 5 — Budget for Closing Costs
Beyond the down payment, plan to have 1.5%–4% of the purchase price set aside for closing costs:
Legal fees: $1,500–$2,500 for a real estate lawyer
Home inspection: $400–$600 (highly recommended)
Title insurance: $200–$400
Property tax adjustment: Varies based on closing date
Moving costs: $1,000–$3,000+ depending on distance
Utility hookups and immediate repairs: Budget an additional buffer
Step 6 — Find the Right Neighbourhood
Location is one of the most important factors in a home purchase. Consider:
Proximity to work, schools, transit, and amenities
Future development plans in the area
School ratings and catchment areas
Walk Score and transit accessibility
Historical price appreciation in the neighbourhood
Use our GTA Market Report to explore average prices and trends by city and property type.
Step 7 — Making an Offer
Once you find the right home, your realtor will prepare an Agreement of Purchase and Sale. Key terms include:
Offer price: Based on comparable sales and market conditions
Deposit: Typically 5% of the purchase price, due within 24 hours of acceptance
Conditions: Common conditions include financing approval and home inspection
Closing date: The date you take possession — typically 30–90 days from offer acceptance
In competitive markets, offers may be submitted without conditions. Discuss the risks carefully with your realtor before waiving conditions.
Step 8 — Home Inspection
A home inspection is a thorough evaluation of the property's condition by a licensed inspector. It typically takes 2–3 hours and covers:
Foundation, roof, and structure
Electrical, plumbing, and HVAC systems
Insulation and ventilation
Windows, doors, and exterior
A home inspection can reveal hidden issues that may affect your decision to purchase or give you leverage to negotiate repairs or a price reduction.
Step 9 — Working with a Realtor
As a buyer in Ontario, you do not pay your realtor's commission — the seller typically covers the entire commission for both agents. This means working with an experienced buyer's agent costs you nothing and provides significant value:
Access to MLS listings and off-market opportunities
Expert negotiation on your behalf
Guidance through paperwork and legal requirements
Connections to trusted home inspectors, lawyers, and mortgage brokers
Ready to start your home buying journey? for a free, no-obligation consultation.