Buying a home in Canada —
the complete
2026 guide.
From your first FHSA contribution to handing the lawyer your closing wire — the practitioner’s roadmap. OSFI B-20 stress test, CMHC premium tiers, FHSA + RRSP HBP stacking, and provincial LTT, covered.
Four things that determine
whether you buy — and when.
Most first-time buyers underestimate the tax-savings stack and overestimate how much the stress test will limit them. The real story is more nuanced — and more optimistic.
5% to 20% — know your tier
Federal minimums are tiered: 5% on the first $500K, 10% on $500K–$1.5M, and 20% at $1.5M or more. Below 20% requires CMHC default insurance — a 2.80–4.00% premium usually added to your mortgage.
FHSA + RRSP HBP — up to $200K
Stack two first-time-buyer programs: the FHSA ($40K/person, deductible in and tax-free out) and the RRSP Home Buyers' Plan ($60K/person, repaid over 15 years). Two eligible spouses → up to $200K combined.
Qualify at contract rate + 2% or 5.25%
Federally regulated lenders qualify you at the higher of your offered rate + 2% or 5.25%. For many buyers, the stress test — not the down payment — sets the binding limit on what they can borrow.
Budget 1.5–4% of the purchase price
Land transfer tax, legal fees, title insurance, home inspection, and adjustments. In Ontario, first-time buyers can claim up to $4,000 provincial + $4,475 Toronto rebates — up to $8,475 combined.
From FHSA to keys —
three phases.
Prepare your stack. Lock a rate. Close with confidence. Your advisor stays with you end-to-end.
Prepare your down payment stack
Open your FHSA early — contribution room doesn't carry back, so every year you wait is $8,000 of tax-deductible room lost. Build credit (2+ trade lines, clean for 12+ months). Pay down high-interest debt to improve your TDS ratio. Get pre-qualified: a 5-minute call with no bureau pull gives you your stress-tested max.
Get formally pre-approved
One lender credit check, document submission, and a rate hold of 90–120 days. Your advisor maps your full down-payment stack — FHSA, HBP, gifted funds — and confirms your maximum qualifying mortgage at the stress-test rate. House-hunt inside that number, not an inflated estimate.
Offer, close, and get your keys
Make a firm offer (the written pre-approval lets you go conditional-free when the market demands it). Lender approves the file in 21–45 days — appraisal, underwriting, commitment. Your lawyer handles title and adjustments. You wire the down payment to trust 3–5 days before closing. Keys released, typically, early afternoon.
Is this guide for you?
We can help.
Tap any situation below to see how we approach it.
If you’re…You're a first-time buyer in Canada
You're a first-time buyer in Canada
You likely qualify for FHSA + RRSP HBP + 5% down + 30-year insured amortization + provincial land transfer rebates. We map every program at intake so nothing is left on the table at closing.
Stack my programsIf you’re…You're self-employed or a business owner
You're self-employed or a business owner
Most A-lenders want 2 years of T1 + NOA history. Insured business-for-self programs allow up to 90% LTV when stated income is reasonable. We layer dividends, salary, and add-backs to maximize your qualifying income.
See self-employed optionsIf you’re…You're a newcomer to Canada
You're a newcomer to Canada
Major banks and all three mortgage insurers run newcomer programs. Permanent residents can qualify with as little as 5% down. Work-permit holders' requirements vary — we know which lenders accept alternative credit evidence when you have no Canadian history.
See newcomer programsIf you’re…You have less than 20% down
You have less than 20% down
Insured mortgages (under 20% down) are available up to $1.5M since December 15, 2024. The CMHC default insurance premium is added to your mortgage — you don't pay it upfront. We model total cost vs saving 20% so you decide with the full picture.
Get pre-approvedIf you’re…You're buying in Ontario or Toronto
You're buying in Ontario or Toronto
Ontario's tiered land transfer tax applies on every purchase. Toronto adds a second municipal LTT that roughly doubles the bill. As a first-time buyer you can claim up to $4,000 provincial + $4,475 Toronto rebates. We handle the paperwork so nothing is missed.
Calculate my LTTIf you’re…You're at the edge of what you can qualify for
You're at the edge of what you can qualify for
If the stress test is your binding limit, provincially regulated credit unions (Meridian, FirstOntario, etc.) set their own qualifying policies for uninsured mortgages. For a strong borrower near the edge of affordability, that can mean meaningfully more room.
Explore all lendersDown payment minimums
and CMHC premium tiers.
The tiered minimum means a $700K home needs $45,000 down — not $35,000. And the CMHC premium, usually added to the mortgage, is not just a fee: it’s what unlocks the best A-lender rates.
| Purchase price | Min down ($) | Min down (%) | CMHC premium est. |
|---|---|---|---|
| $300,000 | $15,000 | 5% | $11,400 (4.00%) |
| $500,000 | $25,000 | 5% | $19,000 (4.00%) |
| $700,000 | $45,000 | 6.4% | $26,200 (4.00%) |
| $1,000,000 | $75,000 | 7.5% | $37,000 (4.00%) |
| $1,400,000 | $115,000 | 8.2% | $51,400 (4.00%) |
| $1,500,000 | $300,000 | 20% | $0 (uninsured) |
Illustrative: premium assumes the minimum down payment (4.00% tier) on a standard 25-year amortization. More down = lower premium tier. Homes at $1.5M+ need 20% down and can’t be insured. Calculate your exact CMHC premium.
Common questions,
clear answers.
Down payment math, FHSA vs. HBP, stress test, closing costs, LTT — answered plainly.
How much down payment do I need to buy a home in Canada?
Federal minimums: 5% on the first $500,000 of the purchase price, 10% on the portion from $500,000 to $1.5M, and 20% at $1.5M or more. So a $700K home requires 5% × $500K + 10% × $200K = $45,000 down. Below 20% down you need mortgage default insurance from CMHC, Sagen or Canada Guaranty; the premium (2.80-4.00% of the loan for 5-19.99% down) is usually added to the mortgage.
What is the First Home Savings Account (FHSA)?
An FHSA lets first-time buyers contribute up to $8,000 a year ($40,000 lifetime), deduct contributions like an RRSP, and withdraw tax-free for a qualifying first home like a TFSA. Two spouses who each qualify can each have one, for up to $80,000 as a household.
Can I combine the FHSA with the RRSP Home Buyers' Plan?
Yes, they stack. The HBP lets each eligible buyer withdraw up to $60,000 from their RRSPs for a first home, repaid over 15 years; missed repayments are added to your income. A couple who both qualify could combine up to $80,000 of FHSA savings and $120,000 of HBP withdrawals. We model which account to draw first for your tax situation.
What is the Canadian mortgage stress test?
Federally regulated lenders qualify you at the greater of your contract rate + 2% or 5.25%, and insured mortgages face the same federal test. So an illustrative 4.39% mortgage qualifies at 6.39%. The stress test doesn't change your payment; it determines how much mortgage you can carry. Provincially regulated credit unions set their own qualifying policies for uninsured loans.
How long does a Canadian mortgage take to close?
Typical: 21-45 days from a firm purchase agreement. Faster (14-21 days) on clean A-lender files with simple income. Longer (45-60 days) on B-lender, private, complex BFS, or new-build closings. The lender needs 5-10 business days for underwriting, the appraisal needs 5-7 days, the lawyer needs 3-5 days.
What are the closing costs when buying a home in Canada?
Budget 1.5-4% of the purchase price. That includes land transfer tax (most provinces charge one; Alberta and Saskatchewan charge title registration fees instead), Toronto's municipal land transfer tax if you buy in the city, legal fees (often $1,500-2,500), title insurance, a home inspection, an appraisal if the lender doesn't cover it, provincial sales tax on the insurance premium in Ontario, Quebec and Saskatchewan, and property tax and utility adjustments.
Do I need a home inspection?
Not legally required, but strongly recommended on resale homes. $400-700. New-build homes have Tarion (ON) / BC Home Warranty / similar provincial warranties covering structural defects. Resale homes have no such warranty — the inspection IS your protection.
What's the difference between pre-qualified and pre-approved?
Pre-qualified: estimate based on what you tell us, soft inquiry, useful for shopping. Pre-approved: lender has reviewed your file (credit + documents) and committed in writing subject to property. Real-estate agents and sellers take pre-approvals seriously; pre-qualifications less so.
Can I back out if my financing falls through?
Only if your offer is conditional on financing. In a hot market sellers prefer firm (unconditional) offers, which is why pre-approval matters: with a written pre-approval you can go firm with much lower risk. Without one, never waive the financing condition.
What is land transfer tax and how much will I pay?
A one-time tax paid on closing. Ontario's provincial LTT is tiered (0.5% to 2.5%), and the City of Toronto adds its own municipal LTT with similar brackets, roughly doubling the bill. On an $800K Toronto home: about $12,475 provincial + $12,475 municipal = $24,950. First-time buyers can get refunds of up to $4,000 (Ontario) and up to $4,475 (Toronto). Alberta and Saskatchewan have no LTT. Use our LTT calculator.
How do I qualify if I'm self-employed?
Most A-lenders want 2 years of T1 + NOA history. Insured business-for-self programs allow up to 90% loan-to-value when your stated income is reasonable (typically 2+ years in business); uninsured stated-income programs typically need 20-35% down. We layer dividends, salary and add-backs (CCA, home office, vehicle) to maximize qualifying income. See self-employed mortgages.
Can newcomers to Canada buy a home in their first year?
Often, yes. Major banks and all three mortgage insurers (CMHC, Sagen, Canada Guaranty) run newcomer programs, and permanent residents can qualify with as little as 5% down on an insured purchase. Work-permit holders' requirements vary by lender and insurer, and non-Canadians should check the federal restrictions on buying residential property. Lenders may accept alternative credit evidence if you have no Canadian history. See newcomer mortgages.
We’ll try to beat your rate.
If we can’t, we pay you $500.¹
¹ Rate Beat: eligible Big-6 bank written offers only · same product, term & amount · $500 paid to you or your nominated charity at closing · conditions apply
Find a specialist in your city
The stress test works the same coast to coast, but the down payment you actually need is set by local prices, and the closing cost picture changes by province. Our advisors know the LTT rules, lender preferences, and program stacking in each market.