Unlocking Your Path to Homeownership: Ontario's First-Time Buyer Incentives and Requirements

Becoming a first-time homebuyer is a momentous step, and Ontario offers several incentives and credits to help make this journey a bit more manageable. Whether you’re new to the real estate scene or have been saving diligently for your dream home, understanding these options is the first step to unlocking your path to homeownership.

Ontario’s Land Transfer Tax Refund for First-Time Home Buyers

One of the most significant financial considerations when purchasing a home is the land transfer tax collected both provincially, and in Toronto, municipally. 

Ontario provides a Land Transfer Tax Refund for First-Time Home Buyers, which is often a welcome relief. This refund can be a substantial savings for those stepping into the property market for the first time.

As of October 2023, the maximum refund amount stood at $4,000. To qualify for this refund, you must meet certain criteria:

  • You must be at least 18 years old.
  • You cannot have owned a home anywhere in the world.
  • Your newly purchased home must be in Ontario.
  • You must intend to occupy the home as your primary residence within nine months of the purchase.

The refund can significantly offset the costs associated with buying your first home in Ontario.

It’s important to note that the City of Toronto charges their own municipal Land Transfer Tax, and in turn offers a Land Transfer Tax Refund for First-Time Buyers up to $4,475.

Check out the TRREB Land Transfer Tax Calculator to learn how much you can expect to pay on a home purchase, as a First-Time Buyer or not.

*NOTE If the person you are buying a home with has previously owned a home anywhere in the world, the amount of the refund will be reduced. It is also important to remember that the Land Transfer Tax is in addition to the purchase price of the home, and cannot come out of any mortgage funds – so when calculating how much you have for a down payment, remember to set aside enough to cover your Land Transfer Taxes.

Home Buyer’s Plan (HBP)

Another noteworthy option is the Home Buyer’s Plan (HBP), a federal program that applies across Canada. It allows you to withdraw up to $35,000 tax-free from your Registered Retirement Savings Plan (RRSP) to buy or build a qualifying home. This can be especially helpful for first-time homebuyers, as it provides a source of funding for your down payment.

What qualifies a buyer and a home for the HBP? According to the Canadian Government, a first-time buyer is classified as an individual who hasn’t possessed a home that served as their primary residence from January 1st of the fourth year prior to the year of withdrawal, up to just 31 days prior to their withdrawal. The home must be the principal address, and if you withdraw from your RRSP before closing on your new home, you must own or build the home by October 1st of the following year.

It’s crucial to understand that the HBP requires you to repay the amount withdrawn from your RRSP over a 15-year period, beginning 2 years after your purchase. Failing to repay the required amount in a given year will count as taxable income. This means that while the HBP provides a useful source of funds for your home purchase, it’s vital to plan your repayments accordingly.

First Home Savings Account (FHSA)

As of April 1, 2023, the First Home Savings Account lets prospective first-time buyers have an account designed specifically to help them save for their down payment even faster – and tax free!

The FHSA allows first-time buyers to contribute up to $8,000 per year, tax-free, up to a lifetime limit of $40,000. It is important to note that while you can transfer any unused portion of the annual $8,000 allowance to the following year, you only have 15 years to save the maximum amount before it must be transferred or used to purchase a home, and the account closed. 

In order to qualify for a First Home Savings Account, an individual must:

  • be between the ages of 18 and 71 yrs old
  • be a Canadian citizen or permanent resident
  • not have lived in or owned a property as your principal residence up to 4 years before opening the account. This applies to both the individual opening the account and their partner/spouse
  • be purchasing the home as your principal residence, 
  • must move into the home within a year of purchasing

Should you choose to withdraw the funds for any purpose other than to purchase your first home, it will be taxed as income.

Ontario’s First-Time Home Buyer Tax Credit (HBTC)

In Ontario, first-time homebuyers can also take advantage of the First-Time Home Buyer Tax Credit. This credit (up to $5,000) provides a rebate of up to $750 on on your income tax return. The rebate can only be used once, so if buying with another (spouse/friend/family) either you or your co-purchaser can claim the credit, or you can share it.

As with the Land Transfer Tax Refund, there are criteria to meet. You must be at least 18 years old, intend to occupy the home as your primary residence, and not have owned a home anywhere in the last 4 years.

*NOTE: Changes have been proposed that would increase the amount used to calculate the HBTC to $10,000, which would provide a tax credit of up to $1,500 to eligible home buyers. All other rules with respect to the credit and the increased limit will remain unchanged.

Canadian Mortgage and Housing Corporation (CMHC)

The Canadian Mortgage and Housing Corporation offers help to first-time buyers two ways. 

Helping you Save: Saving for the downpayment on your first home can be a daunting task. The CMHC makes it possible for buyers to put as little as 5% down on a property by offering mortgage loan insurance (mandatory on any purchase with less than 20% down payment).

Investing with You: The second program offered by the CMHC is the First-Time Home Buyer Incentive Plan (FTHBI). This works differently in that the CMHC will top up your down payment by 5% (10% on new-build) for a share in the appreciation (or loss) in equity when the house sells. This top-up is provided to the buyer interest-free, and does not have to be repaid until the house is sold.

What’s the catch? Well, in order to qualify a first-time buyer must:

  • never have owned a home before
  • be a Canadian citizen or permanent resident
  • be recently separated/divorced (marriage or common-law)
  • not have occupied a home that was owned by a current/previous spouse/partner
  • earn a salary of $120,000 ($150,000 if buying in Toronto)
  • be able to put a minimum of 5% and LESS THAN 20% down payment towards the purchase
  • qualify for a mortgage

Be sure to check out the CMHC website for valuable tools for the home-buying process.


Ourboro is a Canadian real estate investment company focused on helping first-time buyers get into the housing market. With a focus on Southern Ontario**, in particular the GTA, Hamilton, Guelph, Kitchener-Waterloo, and London, they will contribute up to $250,000 towards the downpayment of your first home.

Like the CMHC, Ourboro is investing in the future appreciation (or depreciation) of your home, it is not considered a loan and therefore you assume no additional debt. When it comes time to sell they will take a percentage of the proceeds based on their initial investment.


Curious to know if Ourboro is a good fit for you? Feel free to check out their FAQs page with plenty of detailed information, but in short, a first-time buyer interested in working with Ourboro must:

      • be looking to buy a home in an area they work in**
      • be able to put a minimum of 5% down payment towards the purchase (to a maximum of 15%)
      • be purchasing the home as your principal residence
      • be a citizen or permanent resident of Canada
      • be pre-approved by one of Ourboro’s lending partners
      • looking to co-own for less than 10 years

The piece that sets Ourboro apart from the CMHC program, in my opinion, is their complimentary home maintenance package and the fact that they are willing to work with homeowners on any major improvements to the house, down to helping you apply for renovation credits.

Other Local Programs and Incentives

In addition to these provincial and federal programs, various municipalities in Ontario may offer additional incentives and credits for first-time homebuyers. It’s a good idea to check with your local government or consult with a knowledgeable Realtor to uncover any local opportunities that may apply to your situation.

When considering these incentives and credits, remember that eligibility criteria and benefit amounts may change over time. It’s essential to stay updated with the latest information to make the most of these valuable programs when embarking on your first home-buying journey in Ontario. Always consult a tax professional or financial advisor for personalized advice regarding your specific circumstances.

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