First-Time Home Buyer Guide Ontario (2025-2026 Edition) -

Updated: December 2025

Most first-time buyers in Ontario start with mortgage pre-approval, then confirm their down payment, monthly budget, and closing costs before they shop seriously. In the GTA, condos are often the entry point. In Hamilton and Niagara, the same budget can sometimes open more freehold options. This guide breaks down steps, costs, and the programs that can help.

Start Here

Step 1: Secure Mortgage Pre-Approval

A mortgage pre-approval gives you a clear maximum purchase price and a realistic monthly payment estimate. Lenders review your income, credit score, debts, and down payment source, then hold a rate for a set period.

What lenders review

Income and employment stability
Credit score and repayment history
Existing debts (car loans, credit cards, student loans)
Down payment amount and source of funds
Estimated property taxes and heating costs

Step 2: Build Your Down Payment

Your down payment affects affordability and determines whether mortgage default insurance is required.

Minimum down payment rules

5% on the first $500,000
10% on the portion between $500,000 and $999,999
20% for homes priced at $1 million or more

If your down payment is under 20%, mortgage default insurance is required. Planning tool: CMHC mortgage calculator

Common down payment sources first-time buyers use

FHSA savings
RRSP Home Buyers’ Plan (HBP) withdrawals
Personal savings
Gifted funds from immediate family (with a lender gift letter)

Monthly Cost Snapshot

Example planning range for a $650,000 purchase with 5% down. Estimates only. Your payment varies by rate, amortization, taxes, insurance, and condo fees (if applicable).

Mortgage payment (example range): $3,900 to $4,300 per month
Property tax: $300 to $450 per month
Condo fees (if applicable): $400 to $700 per month
Utilities and insurance: $200 to $350 per month

Common Mistakes First-Time Buyers Make in Ontario

Underestimating closing costs. Land transfer tax, legal fees, and adjustments can surprise buyers, especially in Toronto.
Ignoring condo fees in affordability. Condo fees change your monthly comfort level and can affect lender qualification.
Waiting too long to document gifted funds. Lenders usually need a gift letter and a clear paper trail early.
Not planning for status certificate timing. Condo due diligence has its own timeline and can influence offer strategy.
Falling in love before confirming the numbers. Align your search area and property type with your monthly budget first.
Assuming every market moves the same way. The GTA, Hamilton, and Niagara can behave differently week to week, so strategy should match the local pace.

Want a realistic monthly budget for your numbers?

Share your down payment range and preferred areas. We’ll outline a realistic price bracket, expected monthly costs, and a search plan that fits your timeline.

Book a Buyer Call Request a Budget Breakdown

How Market Conditions Influence Buyer Options

Interest rates, inventory, and seasonality affect what’s realistic at each price point. In some markets, buyers can negotiate more. In others, the best homes move quickly.

What to do when competition is higher

Tighten your must-have list and stay flexible on finishes
Consider widening your search radius
Get your documents ready before you offer
Choose conditions strategically based on property type and risk

Condo vs Freehold

Condos are often the most common entry point for first-time buyers in many GTA areas. They can be simpler day-to-day, but you’ll want to understand condo fees, status certificates, and building financials.

Freehold homes offer more independence and often more space, but you’ll need a repair and maintenance budget.

Condo guide: Buying a Condo in the GTA in 2025–2026

Case Example: What a $650,000 Budget Buys Across the GTA, Hamilton, and Niagara

This comparison shows how far a $650,000 budget can go across Mississauga, Brampton, Vaughan, Hamilton, and the Niagara Region. Availability depends on the neighbourhood, building, and the week you’re shopping.

Buyer profile

Combined income: $150,000
Down payment savings: $45,000
Pre-approved purchase price: $650,000
Goal: more space without exceeding budget

Region	Typical options	Notes
Mississauga	1-bedroom condo; older 2-bedroom condo; select condo townhomes	Many first-time buyers land in a 1-bedroom. Larger units under $650K are often older or require compromise on location.
Brampton	1-bedroom or 1+1 condo; older 2-bedroom condo; stacked townhomes	Often offers slightly more space than Mississauga at similar pricing, depending on building and location.
Vaughan	1-bedroom condo; small 1+1; older 2-bedroom condo	Freehold options at this budget are limited in many pockets, so most buyers compare condos closely.
Hamilton	2-bedroom condo; modest freehold townhouse; small detached	Can provide more property choice at the same price point for some buyers.
Niagara Region	Freehold townhouse; 2 to 3 bedroom detached	Budget often stretches further depending on the community. GTA vs Niagara Home Search Tips

Step 3: Plan for Closing Costs

Many first-time buyers set aside about 3% to 4% of the purchase price for closing costs. The exact number depends on where you buy and whether the home is in Toronto.

Common closing costs

Land transfer tax (provincial, plus an additional municipal tax in Toronto)
Legal fees and disbursements
Title insurance
Home inspection (recommended in many cases)
Adjustments (property taxes, utilities, condo adjustments)

Ontario Home Buyer Incentives

Full breakdown with examples: Ontario Home Buyer Incentives (Updated for 2025–2026)

RRSP Home Buyers’ Plan (HBP)

Eligible buyers can withdraw up to $60,000 from RRSPs for a down payment. Reference: CRA HBP details

First Home Savings Account (FHSA)

The FHSA is designed to help eligible buyers save with tax advantages. Reference: CRA FHSA details

Ontario land transfer tax refund for first-time buyers

Ontario provides a land transfer tax refund for eligible first-time buyers. Reference: Ontario.ca LTT refunds

Toronto municipal land transfer tax rebate

Toronto may provide a rebate for eligible first-time purchasers. Reference: Toronto.ca first-time purchasers

First-Time Home Buyer Incentive (Shared Equity Program) | Discontinued

CMHC is no longer accepting applications for this program. Reference: CMHC program status

Sources (updated December 2025)

CMHC: mortgage calculator and program status
CRA: FHSA and HBP
Ontario.ca: land transfer tax refunds
City of Toronto: first-time purchaser rebate

Next Steps

If you’re buying within the next 3 to 6 months, your next step is to confirm your numbers and choose a realistic search area based on lifestyle, commute, and the type of home you want.

Ready to plan your next step?

We’ll map out your numbers, your timeline, and a realistic search strategy across the GTA and Niagara based on what you actually want to live in.

Book a First-Time Buyer Call Get a Custom Budget + Closing Cost Estimate

FAQs

How much do first-time buyers need to get started?

Most buyers need a minimum down payment plus funds for closing costs. In Ontario, closing costs and lender requirements vary by price, location, and property type, so confirm your numbers before you shop seriously.

Do I need a home inspection

In most cases, it’s a smart move. An inspection helps you understand condition and risk. In competitive markets, strategy may vary by property type and offer timing.

Can I buy with gifted funds?

Often yes. Most lenders require a signed gift letter and a clear paper trail. Have the funds documented early so your mortgage approval doesn’t get delayed.

What closing costs should I expect in Ontario?

Common costs include land transfer tax, legal fees, title insurance, adjustments, and sometimes an inspection. Toronto buyers may also pay municipal land transfer tax on top of the provincial tax.

What are the main first-time home buyer incentives in Ontario?

The most common programs are the First Home Savings Account (FHSA), the Home Buyers’ Plan (HBP), and the Ontario Land Transfer Tax rebate. Toronto buyers may also qualify for an additional municipal rebate.

Do I need a real estate agent to buy my first home?

You’re not required to work with an agent, but most first-time buyers choose to. A Realtor helps with neighbourhood insights, offer strategy, negotiations, and reviewing potential issues in a property before you make a decision.

Is it better to buy a condo or freehold home first?

Condos are often a common entry point in many GTA areas, while Hamilton and Niagara may offer more freehold options at similar price points. The right choice depends on lifestyle, monthly costs, and long-term plans. A condo can be a smart first step if the building is financially healthy.