Can I buy a home in the GTA with less than 20% down?
Yes. Many first-time buyers in the Greater Toronto Area purchase homes with far less than 20% down. In Canada, insured mortgages allow qualified buyers to purchase with as little as 5% down on the first $500,000 of a property's purchase price. This has helped many renters transition into homeownership sooner than they expected.
What is the FHSA and how does it help first-time home buyers?
The First Home Savings Account (FHSA) is a Canadian government program designed to help first-time buyers save for a home tax efficiently. Contributions are tax deductible, and withdrawals used toward a qualifying home purchase are tax free. Buyers can contribute up to $8,000 per year, with a lifetime maximum of $40,000.
Can I use both the FHSA and the Home Buyers' Plan together?
Yes. Eligible first-time buyers can combine the FHSA with the federal Home Buyers' Plan (HBP). The HBP allows buyers to withdraw up to $60,000 from their RRSP tax-free toward a home purchase. Using both programs together can significantly increase available down payment funds.
Do first-time home buyers get land transfer tax rebates in Toronto?
Yes. First-time buyers in Ontario may qualify for a provincial land transfer tax rebate of up to $4,000. Buyers purchasing within the City of Toronto may also qualify for an additional municipal rebate of up to $4,475. Combined, eligible buyers could receive up to $8,475 back at closing.
How much income do you need to buy a home in Toronto or the GTA?
The amount of income needed depends on several factors, including your down payment, existing debt, interest rates, and the type of property you want to purchase. Many buyers assume they need a much higher income or savings amount than they actually do. Speaking with a mortgage professional and REALTOR® can help you understand what you may realistically qualify for in today's market.
Is now a good time for first-time buyers to enter the Toronto real estate market?
Market conditions constantly change, but many first-time buyers are currently benefiting from increased inventory, more negotiating power, updated mortgage rules, and government savings programs. For some renters, this may be one of the more favourable opportunities in recent years to explore homeownership in the GTA.
Ali Khalil is a registered Salesperson and REALTOR® with Royal LePage Terrequity Realty, Brokerage (independently owned and operated) in the Greater Toronto Area.
