Getting into the market in the GTA has gotten increasingly difficult over the last decade. First-time buyers are opting for new innovative ways to purchase their first property. Buying an investment property first, buying a house and living in the basement while collecting rent for the main floor, or co-owning with a friend or relative. Whether you go for one of these alternate methods or you can afford to go the conventional route the info below is a good guide for first-time buyers.

First-time home buyers’ tax credit

To assist first-time buyers with the costs related to the purchase of a home FTHBC provides a 15% income tax credit for closing costs.

5% down payment

As a first-time homebuyer, you can purchase a property with as little as 5% down. Any time there is a down payment of less than 20%, you’ll need mortgage loan insurance. This protects your lender in case you can’t make your payments. To get the full details on this, including the costs of the insurance click here.

Do I qualify? To get a refund of land transfer tax, you:

  • must be at least 18 years old.
  • must occupy the home as your principal residence within nine months of the date of transfer.
  • cannot have ever owned an eligible home, or an interest in an eligible home, anywhere in the world, and,
  • if you entered into an agreement of purchase and sale before December 14, 2017, the eligible home must be newly constructed and you must be eligible for the Tarion New Home Warranty.
  • if you have a spouse, your spouse cannot have owned an eligible home, or an interest in an eligible home, anywhere in the world while being your spouse.
  • you must apply for a refund within 18 months after the date of the transfer.

RRSP Home Buyers’ Plan

The Home Buyers’ Plan (HBP) is a program under which you can withdraw up to $35,000 from your Registered Retirement Savings Plan (RRSPs) to buy or build a qualifying home. Withdrawals that meet all applicable HBP conditions do not have to be included in your income, and your RRSP issuer will not withhold tax on these amounts. However, before you can withdraw funds, you must have entered into a written agreement to buy or build a qualifying home that you must occupy no later than one year after buying or building the home.


How long does the money have to be in RRSPs before you can use it for your first home purchase? For example, if you have already saved $35,000 for a down payment and assuming you still had enough “contribution room” in your RRSPs for a contribution of that amount, you would have to move your savings into an RRSP at least 90 days before your closing date. Then, simply withdraw the money through the Home Buyers’ Plan.

The first-time homebuyer incentive

The incentive is available to first-time homebuyers with qualified annual incomes of $120,000 or less. A participant’s insured mortgage and the incentive amount cannot be greater than four times the participant’s qualified annual income. For more information please click here.

Land transfer tax rebates (Ontario & Toronto)

The maximum provincial land transfer tax (LTT) rebate for first-time buyers is $2,000 and the maximum Toronto LTT rebate for first-time buyers is $3,725  (equivalent to the Toronto LTT payable on a $400,000 property).

Click here for details on the Toronto LTT rebates.

Click here for details on the Ontario LTT rebates.

Want to read more about the home-buying process? Check out these posts for buyers:

Questions? Get in touch!

Don’t like filling out forms? Feel free to call, text, or email me. My cell phone number is 647-830-5210 and my email is

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