First-Time Home Buyer Programs

If you're a first-time homebuyer, it's important to know about current programs available that you can apply for.

As a first-time buyer purchasing real estate, you may be eligible for rebates, such as the land transfer tax refund, tax-benefits that can help fund your down payment, or Government of Canada programs through Genworth or CMHC (Canada Mortgage and Housing Corporation) that allow you to put a minimum of a 5% down payment towards qualifying for your home.

What is CMHC or Canada Mortgage and Housing Corporation?

CMHC insurance is also called mortgage loan default insurance. In Canada, if you have less than a 20% down payment, your mortgage loan must be insured through one of the three mortgage insurance companies. They are CMHC, Genworth and Canada Guarantee. Contrary to some beliefs, this insurance does not protect you against defaulting on your mortgage loan.

It is insurance to protect your financial institution in the event you default on your mortgage loan. It is offered so that financial institutions can have trust in providing a mortgage loan to borrowers who have a smaller down payment and are therefore, "higher-risk."

Mortgage Default Insurance is blended into your mortgage payment and added to the principal balance of your mortgage loan and amortized out to 25 years. 

In Canada, you must have a minimum of 5% down. If the home's purchase price is over $500,000, then you will require 5% for the first $500,000 and 10% on the mortgage amount over and above $500,000 and not over $1,000,000.

**There is currently no mortgage insurance available on real estate being purchased for over $1M. 

Who can use the RRSP Home Buyer Plan (HBP)?

If you haven't purchased real estate within the last four years, you can qualify for the Government's Home Buyer Plan. Under this plan, you may qualify for up to $25,000 (which is exempt from tax but must be repaid in 15 years) to fund your downpayment and buying a home.

It can be extremely beneficial to use the First Time Home Buyer's Plan as a Canadian. Borrowers are exempt for up to fifteen years from having to repay this RRSP loan after withdrawal. 

Do you meet the HBP eligibility conditions? Or
  • You must have a written agreement to buy or build a qualifying home for a related person with a disability, or to help a related person with a disability buy or build a qualifying home (obtaining a pre-approved mortgage does not satisfy this condition). (Source: Canada.ca) 

Land Transfer Tax
As a first time home buyer, you are exempt from paying land transfer tax to up to $4,000. In Toronto, there is double land transfer tax - a provincial tax but also a municipal land transfer tax applies. 

GST/HST New Housing Rebate

This is a rebate that offers money back to borrowers who have purchased a new development, re-build an existing property or re-construct a home that was destroyed due to a fire. 

You may be eligible for a rebate if you: 
  • Purchased a new house or substantially renovated a home (this also can include housing which is situated on leased lands if the lease is for at least 20 years and provides you with the option to purchase the land) OR for use as your principal residence. 
  • If you purchased shares in a co-op for the purpose of being used as your primary residence.
  • If you renovated your own home or hired someone else to renovate your home and the fair market value of your home when the construction is completed and is less than $450,000. 

Start the process of owning your home today with a mortgage pre-approval. 
Resources for First Time Home Buyers: 

How to participate in the Home Buyers' Plan (HBP)

Land Transfer Tax Refund for First Time Home Buyers

High-Ratio Mortgage Insurance (Genworth)
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First-Time Home Buyer Government Grants Summary (Ontario) 

First-Time Home Buyer (FTHB) Tax Credit
Source: CHMC


The FTHB Tax Credit offers a $5,000 non-refundable income tax credit amount on a qualifying home acquired after January 27, 2009. For an eligible individual, the credit will provide up to $750 in federal tax relief.
Home Buyers' Plan (HBP)

The Home Buyers' Plan (HBP) is a program that allows you to withdraw up to $25,000 in a calendar year from your registered retirement savings plans (RRSPs) to buy or build a qualifying home for yourself or for a related person with a disability.
GST/HST New Housing Rebate

​You may qualify for a rebate of part of the GST or HST that you paid on the purchase price or cost of building your new house, on the cost of substantially renovating or building a major addition onto your existing house, or on converting a non-residential property into a house.

Municipalities Offering Home Buyer Grants

There are many municipalities across Ontario who offer grants to home buyers. To find out more information, please contact our office at (647) 773-4849.

Government of Canada's Shared Equity Program

There are a few qualifiers to apply for this incentive:
  • you need to have the minimum down payment of 5% of the purchase price to be eligible
  • your maximum qualifying income is no more than $120,000 combined.
  • your total borrowing is limited to 4 times the qualifying income  (ex. salary is $60,000 which means loan cannot exceed $240,000. 


If you meet these criteria, you can then apply for a 5% or 10% shared equity mortgage with the Government of Canada.  A shared equity mortgage is where the government shares in the upside and downside of the property value. Upside meaning the property makes money, downside meaning if property loses money or depreciates, you will still be obligated to repay the loan. 

How does it work? 
The Incentive enables first-time homebuyers to reduce their monthly mortgage payment without increasing their down payment. The Incentive is not interest bearing and does not require ongoing repayments.    This means there are no monthly repayments and zero percent interest. 

Through the First-Time Home Buyer Incentive, the Government of Canada will offer: 
  • 5% for a first-time buyer’s purchase of a re-sale home 
  • 5% or 10% for a first-time buyer’s purchase of a new construction 

How do I know how much I have to pay back?   

You can repay the Incentive at any time in full without a pre-payment penalty. You have to repay the Incentive after 25 years or if the property is sold, whichever happens first. The repayment of the Incentive is based on the property’s fair market value. 

  • You receive a 5% incentive of the home’s purchase price of $200,000, or $10,000. 
    If your home value increases to $300,000 your payback would be 5% of the current value or $15,000. 
  • You receive a 10% incentive of the home’s purchase price of $200,000, or $20,000 and your home value decreases to $150,000, your repayment value will be 10% of the current value or $15,000. 

NOTE: If your property value goes down, you are still responsible for repaying the shared equity mortgage based on the current home value at time of repayment.  

Who Can Apply For The Home Buyer's Incentive, Shared Equity Program?

Who can apply? 
  • Canadian citizens, permanent residents, and non-permanent residents who are legally authorized to work in Canada. If you are a non-permanent resident you will need to provide your work permit and Visa. 
  • Borrowers must have a maximum qualifying income of $120,000
    • Total qualifying income must be $120,000 per year  or less
    • This is subject to qualifying income requirements set out by lenders and mortgage loan insurers
  • At least one borrower must be a first-time homebuyer, as per the definition below.

What is a qualifying income?
To be eligible for the FTHBI the combined qualifying income on your application cannot be higher than $120,000. That means whether you are applying by yourself, with a friend or a spouse you have to add your qualifying income and make sure it is less than $120,000.
Here are a few examples of qualifying income:
  • annual salary (before taxes)
  • investment income
  • rental income

Are you a first-time homebuyer? 

You are considered a first-time homebuyer if you meet one of following qualifications:
  • you have never purchased a home before
  • you have gone through a breakdown of a marriage or common-law partnership (even if you don’t meet the other first-time home buyer requirements).
  • in the last 4 years, you did not occupy a home that you or your current spouse or common-law partner owned


IMPORTANT: It’s possible that you or your spouse or common-law partner qualifies for the First-Time Home Buyer Incentive (if you are in a married or common-law relationship) with the 4-year clause even if you’ve owned a home.

How does the 4-year period work?

The 4-year period begins on January 1 of the fourth year before the Incentive is funded and ends 31 days before the date the Incentive is funded. For example, if the Incentive will be funded on November 1, 2019, the four-year period begins on January 1, 2015 and ends on September 30, 2019.