First-Time Buyer Guide for Ontario

Lenders look at your income, debts, credit history and the size of your down payment. A mortgage pre-approval shows the amount a lender is prepared to consider and holds an interest rate for a period, though it is not a guarantee of final approval.

Remember the costs of owning as well as buying: property tax, insurance, utilities, maintenance and, for a condominium, monthly common expense fees.

The Financial Consumer Agency of Canada sets out the minimum down payment by purchase price. If your down payment is less than 20%, you will need mortgage default insurance, and the premium is usually added to the mortgage. In Ontario, provincial sales tax on that premium is payable at closing and cannot be added to the mortgage.

• First Home Savings Account (FHSA): a registered account for saving towards a first home. Contributions are generally tax-deductible and qualifying withdrawals are tax-free. The CRA gives $8,000 of participation room in the first year the account is opened.
• Home Buyers' Plan: lets you withdraw from your RRSP to buy or build a qualifying home, with repayment over a set period.
• Ontario land transfer tax refund: eligible first-time buyers can receive a refund of up to $4,000.
• Toronto municipal land transfer tax rebate: for homes in the City of Toronto, eligible first-time buyers can receive up to $4,475.

Eligibility rules apply to each program. Check the official pages linked below before relying on them.

Decide early whether you want to be represented. A registered real estate agent who represents you as a client owes you duties under Ontario's real estate law; RECO's website explains the difference between being a client and a self-represented party.

An offer usually includes the price, deposit, closing date, what is included (such as appliances and fixtures) and any conditions. Common conditions include financing, a home inspection and, for condominiums, a lawyer's review of the status certificate.

A condominium purchase includes a share of the building's common elements and its finances. The status certificate sets out the unit's common expenses, any arrears, the reserve fund, known special assessments, insurance and legal proceedings. Have your lawyer review it before your offer becomes firm.

The Condominium Authority of Ontario publishes guidance for buyers of resale condominium units.

Your lawyer handles the title search, mortgage documents, land transfer tax filing and the transfer of funds. Before closing, budget for land transfer tax, legal fees and disbursements, title insurance, adjustments for prepaid property tax or condominium fees, and moving costs. Our Ontario Real Estate Costs guide has an estimator for land transfer tax.