How much down payment do I actually need to buy a home in Toronto?

In Canada, the minimum down payment required depends on the purchase price of the property.

For homes priced under $500,000, the minimum down payment is 5% of the purchase price.

For homes priced between $500,000 and $1.5 million, buyers must provide 5% on the first $500,000 and 10% on the portion above $500,000.

Example:
If a home costs $800,000, the minimum down payment would be $55,000.

This is calculated as:

• $25,000 (5% of the first $500,000)
• $30,000 (10% of the remaining $300,000)

For homes priced over $1.5 million, the minimum down payment is 20% of the entire purchase price.

When the down payment is less than 20%, the mortgage must be insured through a provider such as CMHC, Sagen, or Canada Guaranty. This is called a high-ratio mortgage. The insurance premium is typically added to the mortgage rather than paid upfront.

In addition to the down payment, buyers should also budget for closing costs, which typically range from 1.5% to 4% of the purchase price in Toronto. These can include land transfer tax, legal fees, title insurance, and other transaction-related costs.

The exact amount required will depend on the purchase price of the home and the buyer’s mortgage approval.