First-time home buyer programs in Ontario

First-time buyers in Ontario can combine several programs. Used together, they can add tens of thousands of dollars to a down payment and cut thousands from closing costs.

By Mehran Salehian, Sales Representative · Reviewed October 2026

First Home Savings Account (FHSA)

Put in up to $8,000 a year, to a lifetime maximum of $40,000. Contributions are tax-deductible like an RRSP, and withdrawals for your first home are tax-free like a TFSA. Unused room carries forward one year (up to $8,000). A couple can each have one, so up to $80,000 together. Open one early: the room only starts counting once the account exists.

RRSP Home Buyers' Plan

Withdraw up to $60,000 from your RRSPs ($120,000 for a couple) tax-free to buy your first home, then pay it back into your RRSP over 15 years. You can use it together with the FHSA.

Land transfer tax rebates

Up to $4,000 back from Ontario, and another $4,475 if the home is in the City of Toronto. Rules and examples.

Longer amortization and higher insured limit

• First-time buyers can take a 30-year amortization on an insured mortgage (less than 20% down), which lowers the monthly payment.
• Insured mortgages are available on homes up to $1.5 million, so you can buy below that price with less than 20% down. How much you need to put down.

Buying a brand-new home

First-time buyers of a newly built home can get the federal 5% GST back (up to $50,000) on homes up to $1 million, reduced gradually between $1 million and $1.5 million, for agreements signed with a builder from March 20, 2025. Ontario has its own new-home HST relief as well, and added a larger, temporary rebate (now law) for agreements signed between April 1, 2026 and March 31, 2027. These rules change often; confirm with the builder and your lawyer before you sign.

Order of operations

1. Open an FHSA now, even with a small amount, to start the room.
2. Get a mortgage pre-approval to know your budget (it also locks a rate for 90–120 days).
3. Use the mortgage calculator and the closing costs guide to set aside the cash you'll need on closing.
4. Save a search on this site to get new listings and price drops the moment they appear.

Program limits as of October 2026. Sources: CRA: FHSA, CRA: Home Buyers' Plan.

A one-year plan

If you think you'll buy within a year or two, this order gets the most out of each program.

1. Today: open an FHSA. Your contribution room only starts once the account exists. You get $8,000 of room a year, up to $40,000 in total, and you can carry unused room forward (CRA). Opening one this year means up to $16,000 of room can be available next year.
2. Over the next months: decide on RRSP money. If you plan to use the Home Buyers' Plan, money you contribute to an RRSP within 89 days before you withdraw it may not be deductible. Contribute early, not at the last minute (CRA).
3. Three to four months before you shop: get pre-approved. You'll learn your budget and minimum down payment, and whether a 30-year amortization makes sense for you.
4. When you find the home: sign the agreement first. Both the HBP and a tax-free FHSA withdrawal need a written agreement to buy or build. A pre-approval doesn't count.
5. Before closing: withdraw the money. Give your financial institutions enough time to process the FHSA and HBP withdrawals before your lawyer needs the funds.
6. After closing: move in and keep records. You must intend to live in the home as your principal residence within one year for the FHSA and HBP. For the land transfer tax rebates, you must move in within nine months.

A worked example

Two partners have each had an FHSA for five years and contributed the full $40,000. Each also has RRSP savings.

• FHSA: $40,000 each, plus any investment growth, comes out tax-free. That's $80,000 together.
• Home Buyers' Plan: up to $60,000 each from their RRSPs, or $120,000 together (CRA).
• Together: up to $200,000 toward a down payment and closing costs before investment growth. You can use the HBP and the FHSA for the same home, as long as you meet each program's conditions at the time of each withdrawal (CRA).

FHSA withdrawals are never paid back. HBP withdrawals go back into your RRSPs over 15 years.

Two different "first-time buyer" tests

This trips people up more than anything else.

• FHSA, the Home Buyers' Plan, 30-year insured mortgages and the new-home GST/HST rebate use a four-year test. You generally qualify if you haven't lived in a home that you or your spouse or partner owned, in the current year or the previous four years.
• Land transfer tax rebates require that you have never owned a home anywhere in the world. Your spouse also must not have owned one while you were together (Ontario).

So someone who sold a home six years ago may qualify for the FHSA, the HBP and a 30-year amortization, but not for the land transfer tax rebates.

Deadlines that matter

• FHSA: for a tax-free withdrawal, the purchase must close before October 1 of the year after the withdrawal (CRA).
• HBP: the home must be bought or built before October 1 of the year after your first withdrawal, or you'll have to cancel your participation.
• Land transfer tax rebates: if your lawyer doesn't claim them on closing, you have 18 months after registration to apply.

Buying a new home: the 2025 and 2026 rebates

There are now three layers of sales tax relief on new homes in Ontario. Your builder and lawyer will confirm which ones apply to you.

• The federal first-time buyer GST/HST rebate. This covers all of the 5% federal tax on a new home up to $1 million, with reduced relief up to $1.5 million. To qualify, you must be at least 18, a Canadian citizen or permanent resident, and pass the four-year test. Neither you nor your spouse can have received this rebate before. For a purchase from a builder, the agreement must be signed on or after March 20, 2025 and before 2031. Construction must start before 2031, and the home must be finished and transferred before 2036 (CRA). CRA says applications are open.
• Ontario's first-time buyer top-up. On the same terms, Ontario offers a rebate of up to $80,000 of the provincial 8% part of the HST (CRA).
• Ontario's enhanced relief for all buyers. This covers agreements signed from April 1, 2026 to March 31, 2027, for a home you'll live in or rent out. Ontario announced relief of up to $130,000, the full 13% HST, on homes up to $1 million. The $130,000 maximum continues up to $1.5 million, with reduced relief up to $1.85 million (Ontario). The provincial law received Royal Assent on May 12, 2026 (Legislative Assembly of Ontario). The federal share depends on federal rules, so confirm the current status with your builder and lawyer before you sign.

Common mistakes

• Opening the FHSA too late. Room doesn't build up until the account is open, and you can carry forward at most one year's worth.
• Counting on rebates for a home you won't live in. Every program here requires the home to be your principal residence, except the 2026 Ontario rental-property relief, which has its own conditions.
• Forgetting HBP repayments in your budget. If you repay less than the minimum in a year, the shortfall is added to your income for that year (CRA).

Frequently asked questions

When do Home Buyers' Plan repayments start?

Normally in the second year after the withdrawal, spread over 15 years. For first withdrawals made from January 1, 2026 to December 31, 2028, repayments start in the fifth year instead. For example, a 2026 withdrawal is first repaid in 2031 (CRA).

Is a 30-year amortization worth it?

It lowers the monthly payment, but you pay more interest over the life of the loan and a higher insurance premium. Compare both in the mortgage calculator.

What's changed in 2025–2026

• New-home GST/HST rebates for first-time buyers opened, along with Ontario's top-up.
• HBP repayment relief now covers first withdrawals made from 2026 to 2028.
• Ontario's enhanced new-home HST relief became law in May 2026.

All limits are as of October 2026.

This guide is general information, not legal, tax or financial advice. Rules and rates change; confirm the details with your lawyer, lender or accountant.