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Journey

Buying your first home in Canada

A stage-by-stage path through federal programs, provincial rebates, and the forms you actually have to file. Every number verified against CRA, CMHC, and the thirteen provincial and territorial ministries within the last 30 days.

Reviewed by Ben Stevenson, Managing Editor, Canadian Money Help Updated April 20, 2026 Methodology
$101,500+ Stackable federal support per person
5–18 mo Typical timeline, start to keys
13 + 3 Provinces, territories, and municipal overlays covered
Personalize my path (60 sec) Browse the stages Jump to my province

What's new for 2026

HBP limit raised to $60,000

Up from $35,000 in the 2024 federal budget. Withdrawals made 2022–2025 get a 3-year grace period before repayment begins.

30-year amortization for first-time buyers on new builds

In effect since December 2024. Reduces monthly payment at the cost of more lifetime interest. Available to any first-time buyer or any buyer of new construction.

FHSA fully rolled out

Now available at every major Canadian financial institution. Annual limit $8,000, lifetime $40,000, combines RRSP deduction with TFSA tax-free withdrawal.

Bill C-4: GST relief on new builds (pending)

Would remove the 5% federal GST on new homes up to $1M for first-time buyers, phased out to $1.5M. Passed Senate; awaiting final approval as of April 2026.

Ontario temporary HST rebate on new builds

Full 13% HST rebate on eligible new homes up to $1M through March 31, 2027. Max benefit $130,000.

BC Property Transfer Tax exemption raised

Full first-time buyer exemption now extends up to $835,000 purchase price, phased out at $860,000. Expanded from the old $500K threshold.

The five stages, start to keys

Typical timeline is 5 to 18 months. Saving is usually the longest phase; closing is the most procedural. The decision on each stage below is the fork that matters most.

  1. 01

    Saving for your down payment

    6 months – 3+ years

    Build the deposit with the right tax-advantaged account. This is where the FHSA and HBP matter most. Province overlays kick in for matched savings and first-home savings incentives.

    Key decision FHSA, HBP, or both?
    Common mistake Parking the down payment in equities inside a 3-year horizon
  2. 02

    Getting pre-approved

    1–2 weeks

    This is where your real buying ceiling is decided. Lenders run GDS and TDS ratios and apply the stress test. Province matters less here; credit profile matters most.

    Key decision Bank or mortgage broker?
    Common mistake Anchoring on the pre-approval maximum instead of what you can actually afford
  3. 03

    Making an offer

    Days to weeks per offer

    The stage where a bad decision costs the most. Conditions, deposit, and bidding discipline matter more than price.

    Key decision Which conditions to keep, which to waive
    Common mistake Waiving inspection without a pre-listing inspection in hand
  4. 04

    Closing the deal

    30–90 days from accepted offer

    Land transfer tax, first-time rebates, and the HBP withdrawal all happen here. Province overlays are at their heaviest.

    Key decision Which rebates and credits to file, in what order
    Common mistake Opening new credit between accepted offer and funding
  5. 05

    After you close

    Ongoing, with three tax-year checkpoints

    Three tax filings and a handful of admin tasks that cost you money if you skip them.

    Key decision HBP repayment strategy and principal residence tracking
    Common mistake Missing the HBTC on next spring's tax return ($1,500 lost)

Decision frameworks

Where a branching question produces a clearer answer than prose.

FHSA, HBP, or both?

The two main Canadian first-home savings programs. Most buyers should use both; here is how to decide.

Do you plan to buy a home in the next 15 years?
Yes
Do you have (or expect to build) RRSP room AND will you save more than $40,000 toward the purchase?
Yes
Stack FHSA + HBP

Max out the FHSA for the deduction plus tax-free withdrawal (no repayment). Then layer the HBP on top to access up to $60K more from your RRSP. A solo buyer can bring up to $100K of tax-advantaged cash; a couple up to $200K.

No
Start with the FHSA

The FHSA gives you an RRSP-style deduction plus a tax-free withdrawal with no repayment obligation. It is strictly better than the HBP for buyers who will not exceed the $40,000 lifetime cap. If you later find you will exceed it, open the HBP at that point.

No
Will you contribute to registered savings anyway?
Yes
Skip FHSA; use RRSP and TFSA

The FHSA must be used within 15 years of opening (or by end of year you turn 71), whichever comes first. If you do not buy, the balance can transfer to RRSP, but without RRSP room being created. For long-horizon general savings, the RRSP and TFSA are simpler.

No
Focus on liquid savings first

Before any registered account, build an emergency fund of 3–6 months expenses in a high-interest savings account. Registered accounts are worth using only once your baseline cushion is in place.

How federal and provincial support stacks

The single most useful picture on this page. Each bar shows the stackable programs for a representative buyer. Real totals depend on your price, province, and whether a program is proposed or in force.

Ontario solo buyer, $650K home Up to $109,500 of federal + provincial support
FHSA (lifetime)
$40,000 HBP withdrawal
$60,000 HBTC (federal)
$1,500 Ontario LTT rebate
$4,000 Toronto MLTT rebate (if applicable)
$4,475
Ontario couple, $800K home Up to $215,000 of federal + provincial support
FHSA × 2 (lifetime)
$80,000 HBP × 2
$120,000 HBTC × 2 (splittable, capped)
$1,500 Ontario LTT rebate
$4,000 Toronto MLTT rebate
$4,475 Bill C-4 proposed GST relief (new build, pending)
$5,000
BC solo buyer, $800K home Up to $109,600 of federal + provincial support
FHSA (lifetime)
$40,000 HBP withdrawal
$60,000 HBTC (federal)
$1,500 BC PTT exemption (up to $835K)
$8,000 BC Home Owner Grant (annual, approximated)
$100
FHSA (lifetime) HBP withdrawal HBTC (federal) Ontario LTT rebate Toronto MLTT rebate (if applicable)

By province or territory

Provincial rebates, land transfer tax rules, and municipal overlays. Federal programs apply everywhere; these are the pieces that only apply where you buy.

Ontario Up to $8,475 combined LTT rebate in Toronto View programs & rebates → British Columbia PTT exemption up to $835K purchase price View programs & rebates → Quebec Up to $15,000 Montreal HPAP grant View programs & rebates →
Alberta No land transfer tax; flat title fees only Saskatchewan Provincial tax credit up to $1,050 Manitoba Affordable Homes grants up to $2,500 Nova Scotia Pilot 2% down payment + DPAP loan New Brunswick HAP loans up to $75K (income-gated) Newfoundland & Labrador Up to 50% closing cost grant Prince Edward Island RPTT exemption up to $200K + $17,500 DPAP YT, NWT & Nunavut Territorial loan programs; federal stack carries most weight

Federal programs that apply to you

Four federal pieces. The FHSA and HBP stack for saving; the HBTC and GST rebate apply at the purchase and post-close.

GST/HST New Housing Rebate

Federal rebate of a portion of GST or HST paid on a new or substantially renovated home. A separate first-time-buyer enhancement removes GST on new builds up to $1M (Bill C-4, pending final approval as of April 2026).

Proposed · pending final approval

Common mistakes, ranked by cost

Ten mistakes first-time buyers in Canada make every year. Avoiding any single one usually pays for everything else you will need across the journey.

  1. 1

    Waiving inspection in a bidding war

    $15K–$80K median post-close surprise

    A structural or mechanical issue discovered post-close is almost always bigger than the margin you saved in the bid. If you must waive, have a pre-listing inspection report in hand.

  2. 2

    Missing the Toronto municipal LTT rebate

    $4,475 unclaimed

    Toronto adds a separate municipal land transfer tax on top of the provincial one. First-time buyers are entitled to a rebate up to $4,475. It must be claimed at registration or within 18 months. Your lawyer should flag it; confirm.

  3. 3

    HBP repayment missed

    15–53% marginal tax on the missed portion, every year

    Each missed 1/15th repayment is added to taxable income that year. Set up an annual calendar reminder for February 28.

  4. 4

    Waiving financing without a firm commitment

    Deposit forfeit + potential lawsuit

    Pre-approval is not a guarantee. Lenders can pull at appraisal. Waive financing only after a firm mortgage commitment in writing, not pre-approval.

  5. 5

    FHSA withdrawal without qualifying purchase

    Full withdrawal taxed as income

    You need a signed agreement of purchase and sale before withdrawing. No signed agreement equals ordinary RRSP-style taxation on the full withdrawal.

  6. 6

    Credit moves 30 days before closing

    Potential firm commitment withdrawal

    Lenders re-pull credit and re-verify employment right before funding. New credit cards, missed payments, or job changes after firm commitment can void the offer.

  7. 7

    Forgetting the HBTC on next year's taxes

    $1,500 unclaimed

    The $1,500 Home Buyers' Tax Credit goes on line 31270 the tax year after you bought. Nothing auto-fills it. Set a reminder for February after closing.

  8. 8

    Gifted down payment without a gift letter

    Mortgage delay or denial

    Lenders need a signed gift letter confirming the funds are a gift, not a loan, plus proof of funds from the giver. Missing documentation can stall the funding call.

  9. 9

    New build GST/HST miscalculation

    $20K–$50K surprise

    GST/HST on a new build is often NOT included in the listed price. Builder contracts vary. Confirm with your lawyer before signing; confirm again before closing.

  10. 10

    Assignment sale tax surprise

    Capital gain reclassified as business income

    Assignment sales of pre-construction condos have become a CRA audit focus. Profits can be taxed as business income, not capital gains, with GST/HST also potentially owed. Get professional advice before signing an assignment.

Frequently asked

How much down payment do I need to buy a home in Canada in 2026?

Minimum 5% on the first $500,000 of purchase price, 10% on the portion between $500,000 and $1,499,999, and 20% on any home priced $1,500,000 or more. Below 20% down triggers mandatory CMHC default insurance, which adds 2.8% to 4.2% to your mortgage.

Can I use the FHSA and HBP together for the same home purchase?

Yes. The First Home Savings Account and the RRSP Home Buyers' Plan stack. A fully funded FHSA ($40,000) plus a maximum HBP withdrawal ($60,000) can bring $100,000 of tax-advantaged cash to a purchase. A couple can bring $200,000.

Who qualifies as a first-time home buyer in Canada?

For most federal programs, you qualify if neither you nor your spouse has owned a home you lived in during the current calendar year or the four preceding calendar years. A separation of 90+ days can restore first-time status. Some provincial programs use narrower definitions.

How long does it take to buy a first home in Canada?

Typical range is 5 to 18 months. Dedicated saving is usually the longest phase (6 months to 3+ years). Once you have your down payment, pre-approval takes 1 to 2 weeks, house hunting runs weeks to months, and closing typically runs 30 to 90 days from accepted offer.

What's changed for first-time home buyers in 2026?

HBP limit raised to $60,000. 30-year amortization available to first-time buyers on new construction. FHSA now fully available at all major institutions. BC first-time buyer PTT exemption raised to $835,000. Bill C-4 GST relief on new builds for first-time buyers is pending final approval.

Is the federal First-Time Home Buyer Incentive still available?

No. The shared-equity First-Time Home Buyer Incentive was discontinued on March 31, 2024. The FHSA, HBP, and HBTC remain in place and in most cases deliver more value than the FTHBI did.

What are the hidden costs of buying a first home?

Budget 1.5% to 4% of purchase price for closing costs. Major items: land transfer tax (net of first-time buyer rebates), legal fees ($1,500–$2,500), title insurance (~$350), home inspection (~$500), status certificate for condos (~$100), PST on CMHC premium in Ontario/Manitoba/Quebec/Saskatchewan, and first-month tax and utility adjustments.

Can a newcomer to Canada buy a first home?

Yes. Permanent residents and most work-permit holders qualify for federal programs like the FHSA, HBP, and HBTC. CMHC, Sagen, and Canada Guaranty all run newcomer mortgage programs that accept limited Canadian credit history. A longer employment record in Canada makes approval easier.

Key terms

If this is your first time seeing any of these terms, start here.

Amortization period

The total time to pay off your mortgage in full if you make the scheduled payments. Typically 25 years, up to 30 years for first-time buyers and new construction.

Closing costs

One-time fees paid at closing on top of the down payment. Budget 1.5% to 4% of purchase price. Includes land transfer tax, legal fees, title insurance, home inspection, and adjustments.

CMHC insurance (mortgage default insurance)

Insurance required when your down payment is under 20%. Premium is 2.8% to 4.2% of the mortgage amount depending on down payment. Not available on homes priced over $1.5M.

Conditional offer

An offer that includes conditions such as financing, inspection, or status certificate review. If a condition fails, the offer collapses and your deposit is returned.

Firm mortgage commitment

A lender's binding approval of a mortgage on a specific property after appraisal and underwriting. Different from pre-approval. Waive financing conditions only after a firm commitment.

GDS ratio (gross debt service)

Housing costs (mortgage + property tax + heat + 50% of condo fees) as a percentage of gross income. Must be at or below ~39% for most insured mortgages.

HBP (Home Buyers' Plan)

Program allowing first-time buyers to withdraw up to $60,000 from an RRSP tax-free, repayable over 15 years.

HBTC (Home Buyers' Tax Credit)

Federal non-refundable tax credit worth up to $1,500, claimed on line 31270 of the tax return the year after you buy.

FHSA (First Home Savings Account)

Registered account that combines RRSP-style tax-deductible contributions with TFSA-style tax-free withdrawals. $8,000 per year, $40,000 lifetime.

Land transfer tax (LTT)

Provincial or municipal tax on property transfers, typically 0.5% to 2%. Alberta, Saskatchewan, and the territories charge only small flat fees.

Principal residence

The home you ordinarily inhabit. Sale of a principal residence is exempt from capital gains tax. Most first-home programs require principal residence use.

Stress test

Qualification rule requiring borrowers at federally regulated lenders to afford payments at their contract rate plus 2% or 5.25%, whichever is higher.

TDS ratio (total debt service)

GDS plus all other monthly debts (car, cards, student loans) as a percentage of gross income. Must be at or below ~44% for most insured mortgages.

Title insurance

One-time insurance protecting against fraud, survey errors, and undisclosed encumbrances on title. Typically a few hundred dollars, often required by lenders.

Assignment sale

Sale of a pre-construction purchase agreement before the building is completed. The original buyer assigns their rights to a new buyer. CRA treats most assignment profits as business income, with GST/HST potentially also owed.

Holdback

Portion of a new-build purchase price withheld by the lawyer for a statutory period (province-specific) to protect against unpaid trades. Typically released 45–60 days after substantial completion.

Gift letter

Signed document from a family member stating that a portion of the down payment is a gift, not a loan, with no repayment expected. Lenders require this plus proof of funds when any portion of the down payment is gifted.

Proof of funds

Documentation showing the source of down payment and closing cost money. Typically 90 days of bank statements or RRSP/FHSA/TFSA statements. Lenders require this before funding.

Status certificate

Condominium document package (Ontario terminology; other provinces use different names) showing the building's financial position, reserve fund, rules, and any pending special assessments. Typically $100 per certificate. Condo offers should always be conditional on status review.

Bridge financing

Short-term loan covering the gap between closing on a new home and receiving proceeds from selling your existing home. Not typically relevant for first-time buyers unless selling an investment property or other asset to fund purchase.

Pre-qualification vs pre-approval

Pre-qualification is a casual lender estimate based on verbal information; essentially meaningless. Pre-approval is a formal underwrite with documentation, giving you a rate hold (typically 90–120 days) and a real ceiling. Always get pre-approved, not pre-qualified.

Interest adjustment date

Date your mortgage interest starts accruing, usually the first of the month following closing. The period between closing and your first regular payment has daily interest owed at closing as an adjustment.

Sources

Every number on this page is verified against the canonical source below within the last 30 days. Click any item to read the original.

Federal programs

Mortgage rules

Ontario

British Columbia

Quebec

Take this with you

Master checklist Every document and action across the journey, grouped by stage. Check off as you go. Progress saves to your device. Content changelog What we've updated and when. Every material change logged with date and reviewer.

Disclosure

This page has no affiliate links. We do not earn commission from any mortgage broker, lender, insurer, or government program referenced here. We maintain this page because a confused first-time buyer costs themselves more than a good calculator costs us.