You have probably heard that buying your first home is exciting. However, no one talks about how stressful it can be to save for the down payment.
In Ontario’s cooling market, where the average home price sits at $848,289 as of February 2025, saving a 5% to 10% down payment ($42,414 to $84,828) is tough. There are also personal or family bills and everyday costs eating into your pockets, which can feel like homeownership is out of reach.
To keep your down payment goal in check, this guide provides simple, realistic steps to help you move from “maybe one day” to “I’m ready.”
Know Your Down Payment Goal
Before you start saving for a down payment, it is important to know how much you will need.
In Canada, a first time home buyer can put down at least 5% of the home’s purchase price. If your budget allows for more, like 10% or 20%, you may avoid the extra cost of mortgage insurance.
A down payment calculator can help you figure out a target number based on your price range and how soon you would like to buy.
Create a Realistic Home Savings Plan
Saving for a down payment isn’t about being perfect, but more about being consistent. To remain constant in home savings, review your monthly income and expenses and find areas where you can cut back, like eating out or unused subscriptions.
Then, set a specific home savings goal each month. Open a separate account to save for a down payment, so the money is out of sight and harder to spend. Automatic transfers help keep you on track without needing to think about it.
Government Programs That Can Help
Ontario offers down payment assistance programs to help first time home buyers save faster.
While the federal first time home buyer incentive (a shared-equity program) has closed as of 2024, you can use the Home Buyer’s Plan to borrow up to $60,000 tax-free from your Registered Retirement Savings Plan (RRSP).
Free First Home Savings Account (FHSA) now allows $10,000/year in tax-deductible contributions.
Ontario’s Land Tax Rebates refund up to $4,000 for qualifying buyers, and select regions are now piloting down payment match grants.
These first time home buyer programs increase savings timelines while keeping costs manageable.
Extra Support: Down Payment Assistance Options
Some cities and private lenders in Ontario offer support through down payment assistance programs. These are designed for people with good credit who just need help with upfront costs.
It could be a first time home buyer loan, grant, or matched savings programs. These down payment assistance options are worth evaluating, especially if you are struggling to save fast enough on your own.
Get a Mortgage Pre-Approval
Before you start the search for your first home, get pre-approved. A mortgage pre-approval gives you a clear idea of how much home you can afford and makes you a stronger buyer in the eyes of sellers.
This step can also help you qualify for a first time home owners loan structured to fit your unique financial profile.
For Help With a Down Payment, Northwood Mortgage Can Guide You
At Northwood Mortgage, we sincerely understand how hard it can be to save and qualify for your first home. That is why we work with a wide network of lenders to help clients secure their first time home owners loan, even when others say no.
Your down payment makes your dream home a reality. Do not lose that bet! Call Northwood Mortgage today at 888-495-4825, or contact us online to talk about your goals and find the best down payment solution.
