Known for its booming economy, world-class universities, diverse landscapes and bustling cities, Ontario is one of the most popular provinces to live and work. The province consistently attracts new residents from all over the world each year, including many prospective first-time homebuyers.
However, due to Ontario’s higher home prices, surging demand and generally low inventory, buying a house in Ontario is a challenge. In June 2024, the average price tag for a home in Ontario was around $890,000 – meaning first-time buyers today are in for a costly mortgage and a much higher down payment than previous generations.
Thankfully, there are federal, provincial and municipal programs that can help give first-time buyers an extra boost. Here are some first-time homebuyer opportunities in Ontario to consider.
Who is a first-time homebuyer in Ontario?
Generally, one is considered a first-time homebuyer if they have never owned a home, and not occupied a home that was owned by either themselves or by their current common-law partner or spouse in the last four years. Exceptions are made for persons living with a disability or persons who have recently experienced the breakdown of a marriage or common-law partnership.
How a first-time homebuyer is defined may differ from program to program, so it’s important to double-check eligibility criterion before applying.
Federal programs
The Home Buyer’s Plan
The Home Buyers’ Plan (HBP) is a federal program that allows first-time homebuyers to withdraw up to $60,000 tax-free from their registered retirement savings plans (RRSPs) to put towards a down payment on a primary residence.
Couples purchasing a home together would be able to cumulatively withdraw up to $120,000 from their RRSPs.
It is important to note that funds withdrawn under the HBP must be repaid to the RRSP within a 15-year period, with at least 1/15th of the withdrawal amount paid back into the account each year.
First Home Savings Account
A First Home Savings Account (FHSA) is a registered savings account which functions similarly to RRSPs and tax-free savings accounts (TFSAs). Deposits are tax-deductible, and any investment returns in that account are tax-free.
Deposits into an FHSA are capped at $8,000 per year, with a lifetime limit of $40,000.
GST/HST New Housing Rebate
The GST/HST New Housing Rebate allows purchasers and homeowners to recover some of the GST or the federal portion of the HST paid for a newly constructed or substantially renovated primary residence.
Different rules apply depending on the property type and location, so it’s important to check eligibility criteria before applying.
Provincial programs
Ontario Land Transfer Tax Refund
First-time homebuyers in Ontario are eligible for a full or partial refund of the provincial land transfer tax, which typically applies to the closing costs of any land or land-interest purchase in Ontario.
To be eligible for the Ontario Land Transfer Tax Refund, an individual must:
- Be at least 18 years old
- Be a Canadian citizen or permanent resident of Canada
- Have never owned a home or interest in a home anywhere in the world
- Not be married to anyone who owns a home or interest in a home anywhere in the world
- Live in the home as a primary residence within nine months after the date of conveyance or disposition
Previous homeownership includes the ownership of homes that were given as gifts or acquired through inheritance.
Municipal programs
First-time purchaser rebate (Toronto)
First-time homebuyers in Toronto can receive an additional tax rebate if they purchase a new construction or resale home within the city.
When purchasing a home in Toronto, homebuyers are usually required to pay two separate land transfer taxes – one to the province, and the other to the city of Toronto. Toronto’s first-time purchaser rebate covers up to $4,475 of the municipal portion of the land transfer tax typically paid during closing costs.
Eligibility criteria for Toronto’s tax rebate is the same as the provincial rebate, so potential applicants could stand to benefit from both programs.
Simcoe County
Simcoe County’s Affordable Homeownership Program aims to assist low-to-moderate income renter households by providing down payment assistance up to $50,000.
One does not need to be a first-time homebuyer to be eligible for this program, as it aims to assist any current resident of Simcoe County that does not currently own any properties.
Kingston/Frontenac County
Renter households in Kingston and the surrounding area of Frontenac County earning a pre-tax income lower than $94,000, or $130,000 for two-person households can apply for a forgivable loan to put towards a down payment on a primary residence valued at $500,000 or less.
Previous homeowners are ineligible for this program.
B-Home (Brantford Home Ownership Made Easier) program
Brantford’s B-Home program offers down payment assistance to first-time homebuyers with a gross household income below $96,000 through a 5 per cent (maximum $20,000) forgivable loan on any home valued at $400,000 or less within Brantford/Brant County.
Private and other programs
Habitat for Humanity
Habitat for Humanity is a non-profit organization that builds multi-family homes in the GTA and provides numerous supports related to affordable housing, renovations and more. Prospective first-time homebuyers earning low-to-moderate income may be able to apply for housing through Habitat GTA’s homeownership model or HomeStart program.
Learn more about Habitat for Humanity’s programs and services by visiting habitatgta.ca
Ready to start searching for a home in Ontario? Try browsing Livabl’s inventory of new construction homes at livabl.com
