Real Estate for Beginners: Buying Your First Home in Canada
Clear, honest guidance for first-time buyers, what you actually need to save, what programs are available to you right now, and how to know when you're ready.
Where Do I Actually Start ?
Buying your first home feels overwhelming mostly because nobody breaks it down simply. Here's the truth: it comes down to three things: how much you've saved, what programs you can use to boost that savings, and what your realistic monthly costs will be once you own.
The Two Programs Worth Knowing
First Home Savings Account (FHSA) A savings account built specifically for a first home. You can contribute up to $8,000 per year, up to $40,000 total over your lifetime. Contributions reduce your taxable income, and unlike an RRSP, withdrawals for your home purchase are completely tax-free. If you only use one program, this is the one to prioritize.
RRSP Home Buyers' Plan (HBP) If you already have RRSP savings, you can withdraw up to $60,000 tax-free toward your first home. It works like an interest-free loan from your future self, you pay it back into your RRSP over 15 years. It can be used together with the FHSA on the same purchase.
Note: The older First-Time Home Buyer Incentive program was discontinued in March 2024 — if you've read about it elsewhere, it's no longer available.
How Much Down Payment Do I Actually Need ?
It's not a flat 5% across the board. The real rule:
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5% of the home's price, on the first $500,000
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10% on the portion of the price above $500,000
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If you're putting down less than 20% total, you'll need mortgage default insurance (commonly called CMHC insurance), which adds a percentage to your mortgage balance
As of December 2024, first-time buyers and new-construction buyers can also access 30-year amortizations and insured mortgages up to $1.5 million, both meaningful changes if you're shopping in a higher-priced market.
What "Ready" Actually Looks Like
You're in a strong position to buy when you have:
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A clear, honest savings number (not a rough guess)
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A realistic sense of your full monthly costs: mortgage, property tax, insurance, and a repair cushion
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An understanding of which programs (FHSA, HBP, land transfer tax rebates in your province) you can actually use
Thinking About Property South Of The Border ?
Some Canadian buyers, once settled at home, look at property in the southern U.S. mostly Florida is a common choice. This is a different process: Canadian programs like the FHSA and HBP don't apply to a U.S. purchase, financing works differently for non-resident buyers, and there are cross-border tax considerations worth understanding before you start. If this is something you're considering, it's worth a separate conversation, we'll walk through it properly rather than guessing at the details here.