How much do first-time homebuyers need for a down payment in Canada?

Many Canadians dream of owning a home one day, but saving for a down payment can often feel like an obstacle for first-time homebuyers. Looking at what other Canadians are putting down and how they’re growing their savings can help you set realistic expectations and understand how your own homebuying goals compare.

Let’s explore average house prices in Canada, how other first-time homebuyers are maximizing their savings and strategies to get closer to your dream of homeownership.

What’s the average house price for first-time homebuyers?

Knowing how much homes cost in your area is an important starting point for your saving strategy. According to the Canadian Real Estate Association (CREA), the average national home price is $663,828 (as at February 2026). However, pricing varies across provinces and territories. 

*Note: CREA does not provide data for Nunavut. Data as at February 2026.

Even small differences in home prices can translate into very different down payment targets. Understanding typical prices where you live can help you estimate how much you’ll need upfront, and whether your savings goals feel manageable for your desired timeline.

It’s also important to consider other buying costs beyond the price of a home when creating your savings target, such as land-transfer taxes, lawyer fees, home inspections and title insurance. There are also ongoing expenses that come with home-ownership, such as property taxes, water, utilities and more. It can be helpful to create a monthly budget ahead of time to determine what you can realistically afford in a home.

How much do first-time homebuyers need for a down payment?

Once you have a better idea about what the average home prices are in your area and what’s within your budget, you’ll want to start thinking about your down payment amount. The down payment is the minimum amount you must pay toward the purchase of the home you’re buying. This upfront payment is deducted from the purchase price, and the remaining balance is covered by the mortgage provided by your lender.

For many first-time buyers, this is one of the largest upfront expenses they’ll ever pay for, which is why understanding the rules early can make the goal feel more concrete.

The minimum amount you need for your down payment depends on the purchase price of the home:

• If your home is $500,000 or less, you’ll need to pay a minimum of 5% of the purchase price.
• If the home is between $500,000 and $1.5 million, you’re required to put down 5% on the first $500,000 and 10% on the remaining portion above $500,000.
• If you’re buying a home that’s $1.5 million or higher, you’ll need a down payment of at least 20%.

Many first-time buyers are spending at their high end when purchasing their home. In 2025, 65% of first-time buyers purchased at the maximum price they could afford. This highlights why it’s especially important to think carefully about your own down payment and monthly costs. Being prepared upfront can help leave more flexibility in your budget after you buy.

Can you put down more than the minimum down payment?  

If you can afford to, paying more than the minimum down payment can have several cost-saving benefits. For example, you’re required to purchase mortgage default insurance if your down payment is less than 20% in Canada. The amount is calculated as a percentage of your loan, based on the size of your down payment and starts at 2.8% for a loan-to-value that’s more than 80%. In 2025, 62% of first-time homebuyers used mortgage loan insurance. A larger down payment can help you reduce your loan-insurance cost, as well as help reduce your monthly mortgage payments by lowering the overall loan amount, which in turn decreases the total interest you’ll pay over time.

Different down payment scenarios

Let’s look at two scenarios for a home that costs $663,828, the average home price in Canada (as of February 2026).

1. If you paid the minimum required down payment, you’d need $41,383. You’d also be required to pay monthly mortgage insurance, which, in this case, would be about $83 per month.
2. If you put 20% down, you’d need $132,766 for a down payment, but wouldn’t be required to pay mortgage insurance (unless your specific lender requires a larger down payment).

Seeing these differences can help illustrate the trade-offs many buyers face: putting less down may help you buy sooner, while a larger down payment can lower your ongoing monthly costs. Understanding this balance can help you decide what feels sustainable for your budget, both now and after you move in. 

How are first-time homebuyers affording their down payment?

So now that you know how much other Canadians are putting toward their first homes, it can be helpful to know how they built those savings. According to the Canada Mortgage and Housing Corporation (CMHC), first-time homebuyers save for an average of 3.4 years for their down payment, and most rent for about 6.3 years before buying their first home.

If you’re early in your journey, these figures can provide some clarity for how long it might take you to save for your own down payment. Many buyers take several years to build their down payment, and there’s no single right pace.

As for how people save for their first home, in 2025, 41% of first-time buyers relied on financial help from family, via gifts or inheritance, with the average contribution coming in at $74,570. However, 80% of those who received help said they could still have afforded their home on their own.

For individual savings, 39% of first-time homebuyers used savings outside a Registered Retirement Savings Plan (RRSP), while 38% made use of a First Home Savings Account (FHSA).

Together, these figures show that while family support can help accelerate the process, many first-time buyers also rely on their own savings, combining different sources based on what’s available to them.

How can you maximize your down payment?

There are several strategies you can take advantage of to help you build your down payment and get closer to your homeownership goals.

Leverage tax-advantaged accounts

In Canada, there are several tax-advantaged savings vehicles that can help you reach home-ownership sooner.

The FHSA is a registered investment account designed to help first-time homebuyers save for their first home. You can also leverage the Tax-Free Savings Account (TFSA) and the Home Buyers’ Plan (HBP) to maximize your savings.

Here’s an outline of how these accounts compare: 

You don’t have to use just one of these accounts; leveraging two or all three can help you maximize your savings. The accounts you use will depend on your timeline, goals and cash-flow needs. A financial advisor can help you determine which accounts are best suited for you. 

Set up pre-authorized contributions (PACs)

Setting up PACs can help you make consistent progress toward your home goal. That’s because the money is automatically transferred from your bank account to your registered account on a regular basis, without you having to think about it. It can also be helpful to increase your contributions as your income rises. Over time, this kind of set-and-forget approach can make a large goal feel more manageable.

Pay off high-interest debt

If you have any debt, paying off high-interest loans can have a meaningful impact. Lowering your debt-to-income ratio can improve your credit score and help you qualify for better mortgage rates. At the same time, paying off debt frees up more cash to put toward your savings.

Take advantage of government credits

There are several federal and provincial/territorial credits you can take advantage of as a first-time homebuyer. For example, the federal Home Buyers’ Amount is a non-refundable tax credit that helps with some of the costs of purchasing a qualifying home. And the First-Time Home Buyers’ GST/HST Rebate may apply if you purchase a new home from a builder.

Some provinces offer their own credits and rebates for first-time buyers as well, such as Ontario’s Land Transfer Tax Refund of $4,000 or British Columbia’s First Time Home Buyers’ Program, which alleviates some or all of the property transfer tax for eligible first-time buyers. Check what’s available to you in your province or territory.

Consider co-signing a mortgage

Co-signing a mortgage with a trusted friend or family member can help you qualify for a larger mortgage than you might be able to afford alone. However, this approach requires some careful consideration. Your co-signer would be financially responsible for any missed mortgage payments, and the loan could impact their borrowing power or credit score. It’s important to have clear communication upfront about long-term plans, contingencies and potentially repayment.

What your down payment could look like

 Several factors go into a down payment, including the price of the home, interest rates and, in some cases, mortgage insurance. This table breaks down different down payment scenarios for a $500,000 home, assuming:

• An interest rate of 5%
• An amortization period of 25 years (300 months)
• A monthly payment frequency
• It’s an existing home (not a new build) 

For illustrative purposes only.

This breakdown helps illustrate how a larger down payment may mean more money upfront, but it can result in significant cost savings in the long run.

The bottom line

Knowing how much to save is an important first step toward affording your first home. And understanding what other Canadians are doing, how much they’re putting down, how long they’re saving and which tools they’re using can help put your own situation into perspective. With a clear plan, the right resources and support from a financial advisor, your goal of home-ownership may be closer than you think.