First-Time Buyer Guide: Ontario Edition 2026

Buying your first home is one of the most stressful financial decisions most people will ever make. It is also one of the most confusing, because the process is wrapped in jargon, the fees are hidden in fine print, and every realtor you talk to is also trying to sell you something. This guide is different: it is the plain-English explainer we wish someone had given us before we bought our first home.

Your 'budget' is not the maximum mortgage your bank will approve. That number is calculated on your gross income, and it does not account for the hundreds of real monthly expenses that make a home comfortable (groceries, insurance, daycare, savings, a life).

Use a conservative affordability calculator and work backwards from your real comfortable payment to the maximum purchase price. This single step saves more first-time buyers from regret than anything else in the process.

'Pre-qualified' means a lender looked at your income and credit and thinks you might qualify for a mortgage. 'Pre-approved' means they have pulled your credit, verified your income, and committed in writing to lend you a specific amount at a specific rate, often held for a set period.

Pre-approval matters for three reasons. First, it tells you exactly how much you can spend. Second, it locks in your rate, so if rates rise while you are house-hunting, you are protected. Third, and most importantly, it makes you a competitive buyer, because sellers take pre-approved offers far more seriously than contingent financing offers.

The three steps to pre-approval are simple: gather your documents, meet with a lender or mortgage broker, and receive the pre-approval letter in writing. Most lenders ask for: Photo ID; your last two years of T4s or Notices of Assessment; a recent pay stub and a letter of employment; statements for savings, investments, RRSP, TFSA or FHSA; bank statements showing where your down payment comes from; and the property tax bill for any property you already own. This takes 3 to 7 business days.

An eligible first-time buyer can put up to $100,000 from an FHSA and RRSP toward a home, and get up to $4,000 back on land transfer tax. There are five programs, each with its own rules.

Ontario land transfer tax refund. Up to $4,000 off provincial land transfer tax, so no tax on the first $368,000 of the price. You must be at least 18, a Canadian citizen or permanent resident, and never have owned a home anywhere in the world (nor your spouse while you have been together), and you must move in within 9 months.

First Home Savings Account (FHSA). Save up to $8,000 a year, up to $40,000 in your lifetime. Contributions are generally deductible, a qualifying withdrawal for your first home is tax-free, and there is nothing to repay. Your room starts in the year you open your first FHSA, so open one early.

RRSP Home Buyers' Plan. Withdraw up to $60,000 from your RRSPs, or $120,000 for a couple who both qualify, and use it with your FHSA. Repay it over 15 years; for a first withdrawal from 2022 to 2028, repayments start in the fifth year after. RRSP contributions made in the 89 days before you withdraw may not be deductible.

First-time home buyers' GST/HST rebate. Up to $50,000 back on the GST (the federal part of the HST) on a newly built or substantially renovated home you will live in as your primary residence: the full rebate up to $1 million, a reduced rebate up to $1.5 million. Buying from a builder, your agreement must be signed on or after March 20, 2025 and before 2031, and you can ask the builder whether they credit the rebate at closing. In Ontario, a separate rebate of up to $80,000 of the provincial part of the HST follows the same rules.

Home buyers' amount (First-Time Home Buyers' Tax Credit). Claim up to $10,000 on line 31270 of your federal return for the year you buy. It is a non-refundable credit worth the lowest federal rate (14% for 2026), so up to $1,400 off your federal income tax.

Each program defines "first-time buyer" a little differently. Ontario's land transfer tax refund requires that you have never owned a home anywhere in the world, while the federal programs generally look back over the current year and the previous four calendar years. Your lawyer, lender or accountant confirms which ones you qualify for.

Sources, checked October 30, 2026: Ontario Ministry of Finance (ontario.ca); Canada Revenue Agency (canada.ca). General information, not legal, tax or mortgage advice. Rules, rates and limits change; confirm the details with your lawyer, lender or accountant.

Budget for closing costs on top of your down payment. On a $700,000 home, Ontario land transfer tax alone is $10,475, or $6,475 for an eligible first-time buyer. Ontario land transfer tax rates: up to $55,000 at 0.5%; $55,000 to $250,000 at 1.0%; $250,000 to $400,000 at 1.5%; over $400,000 at 2.0%; over $2,000,000, where the land contains one or two single family residences, at 2.5%. Durham Region has no municipal land transfer tax; Toronto charges its own. Buyers who are not Canadian citizens or permanent residents also pay Ontario's 25% Non-Resident Speculation Tax, on top of land transfer tax, anywhere in Ontario (at that rate since October 25, 2022), unless an exemption applies. Rebates and refunds exist in some cases; your lawyer confirms.

The other typical costs: legal fees and disbursements, about $2,000 and up, including title insurance and registration. Get a written quote. A home inspection, about $500 for a city home, up to $1,500 for a rural home with a well and septic. An appraisal: a few hundred dollars; some lenders cover it. Adjustments for your share of property tax, utilities or condo fees the seller prepaid. Moving: $1,000 and up. Typical amounts from our Buyer Guide, checked October 30, 2026. Estimates only; your lawyer, lender and inspector confirm the real figures.

With less than 20% down you need mortgage default insurance (CMHC, Sagen or Canada Guaranty). CMHC's premium runs 2.80% to 4.00% of the mortgage (4.50% above 90% loan-to-value with a non-traditional down payment) and is usually added to it. In Ontario, the 8% provincial sales tax on that premium cannot go into the mortgage: you pay it in cash at closing. First-time buyers, and buyers of new builds, can take a 30-year amortization on an insured mortgage for a lower monthly payment. Sources, checked October 30, 2026: Ontario Ministry of Finance (ontario.ca); Financial Consumer Agency of Canada (canada.ca); CMHC (cmhc-schl.gc.ca); Department of Finance Canada (canada.ca). General information, not legal, tax or mortgage advice. Rules, rates and limits change; confirm the details with your lawyer, lender or accountant.

Your lawyer will provide a detailed Statement of Adjustments before closing showing exactly what you owe. Budget for these costs from day one of your home search so they are not a surprise at closing. Our closing cost calculator runs them for your price.

A buyer's agent walks every home with you, drafts the offer, negotiates the terms, coordinates the inspection, reviews the closing package, and protects your interests from start to finish. Before they provide any services, they must give you RECO's Information Guide and explain it, and you sign a Buyer Representation Agreement that sets out the services, your fee, the term and the area searched.

Your fee is agreed in that agreement before you start. If the seller's offer covers it, you pay nothing out of pocket. If the seller offers less, a good agent first negotiates for the seller to cover the gap; if that is not possible, you pay the shortfall plus HST at closing through your lawyer. Every amount should be confirmed in writing before you sign an offer.

A great buyer's agent also tells you 'do not buy this house' when that is the right answer. That is the most valuable thing they do, and it is the thing the wrong agent will never do. Our buying page walks through every step, from the consultation to the first week in your new home.

One: buying at the top of your pre-approval limit. Leave yourself margin. Two: waiving inspection to win a bidding war. Never do this, even in a hot market. The inspection is the cheapest insurance you will ever buy. Three: skipping the title insurance and property survey. Both are cheap, both protect you from legal disasters, and both are worth every dollar.

If you remember one thing from this guide: buying your first home should not feel like a trap. Every step should be explained. Every form should make sense. Every number should be on the table. If you ever feel rushed, confused, or pressured, stop and ask questions. A good team will answer every one, twice if you need.