Updated: April 2025  |  bremo.io financial guides

First-Time Home Buyer Guide for the GTA 2025

Buying your first home in the Greater Toronto Area is one of the most significant financial decisions of your life. Prices are high, competition can be fierce, and the process is complex. But there are real programs to help first-time buyers, and with the right preparation, homeownership in the GTA is achievable. This guide covers everything you need to know.

Step 1: Know Your Budget

Before anything else, understand what you can afford. Canada's mortgage stress test requires you to qualify at the greater of your contract rate + 2%, or 5.25%. This means if you're getting a mortgage at 5%, you must qualify as if you're paying 7%.

As a rough guideline: at current rates, most buyers need a household income of $120,000+ to comfortably afford a $700,000 home with 20% down.

Step 2: First-Time Buyer Programs

Ontario Land Transfer Tax (LTT) Rebate

First-time buyers in Ontario receive a rebate of up to $4,000 on provincial land transfer tax. This eliminates LTT entirely on homes up to approximately $368,000 and provides partial relief up to $600,000.

Toronto Municipal LTT Rebate

If buying in the City of Toronto, first-time buyers get an additional rebate of up to $4,475 on the Toronto municipal LTT. Note: this only applies to the City of Toronto, not GTA suburbs.

First Home Savings Account (FHSA)

The FHSA allows first-time buyers to contribute up to $8,000/year (lifetime maximum $40,000) in a tax-free account. Contributions are tax-deductible, and withdrawals for a qualifying home purchase are tax-free. This is one of the most powerful savings tools available to first-time buyers.

RRSP Home Buyers' Plan (HBP)

First-time buyers can withdraw up to $35,000 from their RRSP tax-free for a home purchase. If you're buying with a partner who is also a first-time buyer, you can withdraw up to $70,000 combined. The amount must be repaid to your RRSP over 15 years.

First-Time Home Buyer Incentive (FTHBI)

The federal government's shared equity program (check current status — this program has had changes to eligibility and availability). Consult a mortgage advisor for current details.

Step 3: Save Your Down Payment

In the GTA, you'll need at minimum:

• 5% down on homes up to $500,000
• 5% on first $500,000 + 10% on amounts above $500,000 (up to $999,999)
• 20% down for homes $1,000,000 and over (CMHC insurance not available)

If your down payment is under 20%, you'll pay CMHC mortgage insurance, which adds 2.8%–4.0% to your mortgage balance.

Step 4: Get Pre-Approved

A mortgage pre-approval gives you a committed interest rate for 90–120 days and tells you exactly how much you can borrow. Get pre-approved before you start viewing homes. In competitive GTA markets, sellers expect buyers to be pre-approved.

Step 5: Closing Costs Budget

Step 6: Work with a Realtor

Buyer agents are typically paid by the seller in Ontario. As a buyer, you can work with an agent at no cost to you. Choose an agent who knows your target neighbourhoods and GTA market dynamics well.

GTA vs Suburbs: Where First-Time Buyers Are Buying

Most first-time buyers in the GTA are increasingly looking east (Durham Region), north (York Region's affordable communities), or west (Hamilton, Kitchener-Waterloo). Oshawa, Ajax, Whitby, Bradford, and Innisfil are top destinations for first-time GTA buyers.