First-Time Home Buyer in Quebec City 2025

Updated March 2025 · Quebec City first-time buyer guide

Step 1: Assess Your Finances Before Searching

Before visiting any Quebec City open house, build a clear picture of your finances. Start with:

• Credit score: Check your Equifax and TransUnion scores for free. A score above 680 qualifies for most lender programs; 720+ gets the best rates. Free annual checks available via both bureaus.
• Debt-to-income ratio: Your total monthly debt payments (including the proposed mortgage) should not exceed 44% of gross monthly income under OSFI guidelines.
• Employment history: Lenders typically require 2 years of stable employment. Self-employed buyers need 2 years of NOA (Notice of Assessment) documents.
• Down payment source: Document your down payment source — gifts from family require a gift letter; funds must be in your account for 90 days before closing for some lenders.

Step 2: Open an FHSA Immediately

The First Home Savings Account (FHSA) launched in April 2023 and is the best savings tool available for Quebec City first-time buyers:

• Contribute up to $8,000/year, with a lifetime maximum of $40,000
• Contributions are tax-deductible (like an RRSP)
• Withdrawals for a qualifying home purchase are tax-free (like a TFSA)
• The combination of upfront tax deduction AND tax-free growth AND tax-free withdrawal is unique to the FHSA
• Unused room carries forward one year (unlike TFSAs)

Open an FHSA as soon as possible — even if you don't have money to contribute immediately. The room starts accumulating from the date you open the account, not from your first contribution.

FHSA at Quebec City banks: Desjardins, National Bank, RBC, TD, and most major institutions offer FHSAs. Compare the investment options available — some FHSAs offer only GICs, others offer full investment fund menus.

Step 3: Use the RRSP Home Buyers' Plan (HBP)

The RRSP Home Buyers' Plan allows first-time buyers to withdraw up to $35,000 from their RRSP tax-free for a home purchase (increased to $35,000 in 2024 from the previous $25,000):

• Funds must have been in the RRSP for at least 90 days before withdrawal
• The withdrawn amount must be repaid over 15 years, starting 2 years after withdrawal
• If you fail to repay in a given year, the missed repayment amount is added to your taxable income
• The HBP and FHSA can be used simultaneously — stack both for maximum down payment

Combined FHSA + HBP example: $40,000 FHSA + $35,000 HBP = $75,000 tax-advantaged down payment contribution, plus any additional personal savings.

Step 4: Get Mortgage Pre-Approval

A pre-approval letter is essential in Quebec City's competitive market. Key points:

• Stress test: Federal lenders must qualify you at your contract rate + 2%, or 5.25%, whichever is higher. As of early 2025, this typically means qualifying around 6.5–7% depending on your contracted rate.
• Desjardins pre-approval: As a provincial cooperative, Desjardins follows AMF guidelines which apply a similar but technically separate stress test. In practice, the qualifying standards are very similar to federal banks.
• Lock-in period: Pre-approvals typically lock in a rate for 90–120 days. Get pre-approved when you're actively searching, not months in advance.

Step 5: Understand Quebec-Specific Costs

Welcome Tax (Droits de Mutation)

One-time municipal tax paid 6–12 months after closing. Quebec City rates (no Montreal surtax applies here):

• 0.5% on first $52,800 → max $264
• 1.0% on $52,800–$264,000 → max $2,112
• 1.5% on $264,000–$528,500 → max $3,968
• 2.0% above $528,500

On a $380,000 first home in Charlesbourg: welcome tax ≈ $4,116. Budget for this before closing even though it arrives later.

Notary Fees

In Quebec, a notary handles real estate closings (not a lawyer). Budget $1,200–$2,500 for notary fees including title deed registration and mortgage hypothec. The buyer chooses and pays for the notary.

QST on CMHC Premium

If you put down less than 20%, CMHC insurance is required. Quebec charges QST (9.975%) on the CMHC premium — this must be paid upfront and cannot be rolled into the mortgage. Example: $380,000 purchase with 10% down ($38,000): mortgage = $342,000, CMHC premium = 3.10% × $342,000 = $10,602, QST on premium = $1,057 (paid upfront).

First-Time Buyer Programs

Best Quebec City Neighbourhoods for First-Time Buyers 2025

• Limoilou: Most accessible prices close to the urban core. Young, vibrant neighbourhood with rising values.
• Saint-Sauveur: Affordable, improving, historic character. Neighbouring Saint-Roch's success is pulling up values.
• Charlesbourg: Suburban, family-friendly, still affordable. Good schools and services.
• Beauport: More affordable than western Quebec City with good access to nature.
• Lévis (south shore): More affordable than Quebec City proper with ferry access to downtown. Great value for young families.

Frequently Asked Questions

Do first-time buyers in Quebec City get a welcome tax exemption?

No — Quebec City does not offer a welcome tax exemption for first-time buyers. The full droits de mutation applies. Montreal has a $500,000 exemption for some first-time buyers; Quebec City does not.

Can I use FHSA and HBP together in Quebec City?

Yes. You can withdraw from both an FHSA and RRSP (via HBP) for the same qualifying home purchase. This gives you access to up to $75,000 in tax-advantaged savings for your down payment.

Is Desjardins or a federal bank better for a first-time buyer mortgage in Quebec City?

Compare both. Desjardins has deep local expertise, unlimited AMF insurance, and community ties. National Bank and others may offer competitive rates. Get pre-approved with at least two lenders before committing.