Minimum down payment depends on the full purchase price. Here are the price thresholds and insurance costs to include in your plan.
Canada's minimum down payment moves in tiers based on purchase price. It is not five percent of the whole thing unless the home costs $500,000 or less:
| Purchase price | Minimum down payment |
|---|---|
| $500,000 or less | 5% of the price |
| $500,000 – $1,499,999 | 5% of the first $500,000 + 10% of the rest |
| $1,500,000 or more | 20% of the entire price |
Premium examples assume traditional down payments and amortizations of 25 years or less. Eligible 30-year insured loans use premiums 0.20 percentage points higher: 4.20%, 3.30% or 3.00%. Confirm the applicable program with your lender.
That middle tier is where people get caught. It applies to most of the Toronto condo market.
5% of the first $500,000 = $25,000. Plus 10% of the remaining $300,000 = $30,000. Total $55,000, not the $40,000 a flat five percent would suggest. That $15,000 gap has stalled a lot of otherwise-ready buyers mid-search.
If your down payment is less than 20%, mortgage default insurance is generally required for eligible high-ratio purchases. The premium is a percentage of the loan and can be added to your mortgage:
| Down payment | Premium on the mortgage |
|---|---|
| 5% – 9.99% | 4.00% |
| 10% – 14.99% | 3.10% |
| 15% – 19.99% | 2.80% |
| 20% or more | None |
Ontario charges 8% provincial sales tax on your mortgage insurance premium, and unlike the premium itself, that tax cannot be added to your mortgage. You pay it in cash on closing day. On a typical high-ratio Toronto purchase it lands somewhere between $1,500 and $2,500, and it surprises nearly every first-time buyer.
On that $800,000 example with $55,000 down, the mortgage is $745,000, the premium at 4.00% is about $29,800, and the Ontario PST on it is roughly $2,384, due in cash, on top of your down payment and land transfer taxes.
Run your own numbers with land transfer tax, CMHC premium, PST and closing costs all included.
Homes priced at $1.5 million or more cannot be insured at all, which means a full 20% down is mandatory, $300,000 minimum. There is no five or ten percent option at that level regardless of income or credit.
Stacking an FHSA with the Home Buyers' Plan is how a lot of Toronto buyers bridge the gap from ten percent toward twenty, which removes the insurance premium and the PST on it entirely.
There is no universally correct answer, and anyone who gives you one without seeing your numbers is guessing. The honest tradeoff: waiting to reach 20% saves you the insurance premium and its PST, but it also means more months of rent and exposure to price movement. Getting in at 10% costs more in financing but starts your equity earlier.
What tips the decision is usually your timeline, your job stability, and whether your savings rate is actually outpacing price growth in the buildings you want. That is a conversation worth having with real numbers rather than rules of thumb.
Five percent on the first $500,000, ten percent on the portion between $500,000 and $1.5 million, and twenty percent on homes priced at $1.5 million or more. On an $800,000 home the minimum is $55,000, not $40,000.
No. The minimum down payment rules are the same for first-time buyers and repeat buyers. What first-time buyers do get is access to a 30-year amortization on insured mortgages, potential land transfer tax rebates of up to $8,475 in Toronto, and accounts like the FHSA and Home Buyers' Plan, each with separate eligibility rules.
The premium is 4.00% of the mortgage with 5–9.99% down, 3.10% with 10–14.99% down, and 2.80% with 15–19.99% down. These are standard premiums for amortizations of 25 years or less with traditional down payments; eligible 30-year insured loans use 4.20%, 3.30% and 3.00% respectively. The premium can be added to your mortgage, but Ontario's 8% sales tax on that premium must be paid in cash at closing.
Yes. The Home Buyers' Plan lets you withdraw up to $60,000 tax-free toward a first home, and a qualifying couple can combine for $120,000. The withdrawal is repaid to your RRSP over 15 years and can be combined with an FHSA.
Only if the condo is priced at $500,000 or less. On a hypothetical $590,000 purchase, the minimum is $34,000: 5% of the first $500,000 plus 10% of the remaining $90,000.
This page is general information for Ontario buyers, not legal, tax, mortgage, or financial advice, and it is not a guarantee of approval, pricing, or availability. Illustrative figures are not current market statistics or lender quotes. Confirm your own numbers with a licensed mortgage professional and a real estate lawyer before making an offer. Brendan Stewart is a Sales Representative registered with RECO (Lic. 6004758) with Keller Williams Referred Urban Realty, Brokerage.
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