Ontario First Home Buyer Incentives

Buying your first home is exciting but can also feel overwhelming. Ontario has fantastic programs to help make the process easier. Here's everything you need to know to take advantage of these first-time buyer incentives and get closer to owning your dream home.

1. Home Buyers' Plan (HBP)

The Home Buyers' Plan (HBP) lets you withdraw up to $60,000 from your RRSP tax-free to buy or build your first home. This is a huge perk, but remember—you’ll need to repay it within 15 years, starting two years after your withdrawal.

• The home must be your principal residence (you live there, not rent it out).

• You can withdraw funds up to 30 days after buying the home.

• If you withdraw before closing, you must own or build the home by October 1st of the following year.

Who Qualifies?
If you haven’t owned a principal residence in the last four years, you’re considered a first-time buyer—even if you’ve owned property in the past. For more info see CRA Rules

2. Land Transfer Tax Refund

In Ontario, you’ll pay a land transfer tax when buying a home, and Toronto adds an extra municipal land transfer tax. Thankfully, refunds are available for first-time buyers!

What You Get:

• Up to $4,000 back on the Ontario land transfer tax.

• Up to $4,475 back if you’re buying in Toronto.

Eligibility:

• You must have never owned a home in Canada

• If you’re buying with someone who has owned a home, your refund will be reduced proportionally.

More details available via Ontario Land Transfer refund site.

3. First-Time Home Buyers’ Tax Credit (HBTC)

The costs of buying a home—lawyer fees, HST, adjustments—can add up fast. Enter the First-Time Home Buyers’ Tax Credit: a $10,000 non-refundable credit that provides up to $1,500 in federal tax relief.

Eligibility:

• The home must be your principal residence.

• Neither you nor your co-purchasers can have lived in a home you owned in the last four years.

• The credit can be shared between co-owners but maxes out at $750 per person.

 4. Canada Mortgage and Housing Corporation Insurance (CMHC)

For buyers with less than a 20% down payment, CMHC insurance makes it possible to buy a home with as little as 5% down. Starting December 15, 2024, this insurance will cover homes priced up to $1.5 million—a big boost for first-time buyers in higher-priced markets.

5. First Home Savings Account (FHSA)

The First Home Savings Account (FHSA) is the perfect tool for saving towards your down payment. Combining the benefits of an RRSP and a TFSA, it lets you contribute up to $8,000 per year, tax-free, with a lifetime cap of $40,000.

• Unused contribution room carries forward (max $8,000/year).

• The home must be your principal residence.

• Funds used for anything other than buying your first home are taxed.

6. 30-Year Amortization for Insured Mortgages

Starting December 15, 2024, insured first-time buyers can spread their mortgage payments over 30 years instead of 25. This results in lower monthly payments, which can help you qualify for a larger mortgage.

Let’s Find Your First Home Together!

Navigating the world of first-time home buyer incentives can be tricky, but these programs are designed to make the journey easier. If you’re ready to explore your options or need guidance, reach out to me—let’s make your dream of homeownership a reality! 🏡