Think You Need 20% Down? Here’s What’s Actually True in Canada – Mother Daughter Team
First-time home buyers reviewing down payment options in Hamilton, Ontario

Think You Need 20% Down? Here’s What’s Actually True in Canada

By Sarah Giglia / August 3, 2026

Here’s the thing… we hear this one all the time.

Someone reaches out about buying their first home, and almost immediately, they say some version of the same thing: “We’re still saving. We’re not ready yet. We need 20% down first.”

And when we ask why, it’s usually because they read it somewhere, a friend told them, or it’s just… what everyone assumes. It’s one of those “facts” that gets repeated so often it starts to feel like a rule. It’s not — and in Canada, the real minimum down payment is a lot more approachable than most first-time buyers think.

What the Minimum Down Payment in Canada Actually Is

Most people don’t realize 20% down isn’t a requirement — it’s a threshold. Once you hit it, you avoid paying mortgage default insurance (the CMHC insurance you’ve probably heard mentioned). That’s really what 20% buys you. It’s not a minimum to qualify for a mortgage.

As of 2026, here’s how it actually breaks down:

  • 5% down on the portion of the purchase price up to $500,000
  • 10% down on the portion between $500,000 and $1.5 million
  • 20% down only required above $1.5 million

So on a $600,000 home, that’s 5% on the first $500,000 and 10% on the remaining $100,000 — roughly $35,000 total, not $120,000. That’s a very different savings goal than most people assume when they hear “20% down.”

The First-Time Buyer Tools Nobody Talks About Enough

Here’s where it gets even more encouraging. If you’re a first-time buyer in Canada, there are a few programs specifically designed to help you get there faster:

  • First Home Savings Account (FHSA) — you can contribute up to $8,000 a year (lifetime max $40,000), it’s tax-deductible going in, and tax-free coming out for a home purchase. It’s genuinely one of the best savings tools available right now.
  • Home Buyers’ Plan (HBP) — lets you withdraw from your RRSP tax-free toward your down payment, repayable over time.
  • Ontario Land Transfer Tax Rebate — first-time buyers in Ontario can get up to $4,000 back on land transfer tax, which helps offset closing costs.
  • 30-year amortizations are now available to first-time buyers, which can meaningfully lower your monthly payment compared to the older 25-year standard.

Most people don’t realize how much these stack together. Combined, they can shrink both your savings timeline and your closing-cost stress by a lot.

What This Looks Like for Buyers Around Here

We talk to buyers across Hamilton, Grimsby, Binbrook, and the Niagara region, and the story is pretty consistent — young couples and growing families who assumed they were years away, only to find out they were closer than they thought once we actually ran the numbers together.

Every neighbourhood has its own price range and its own quirks, which is exactly why a real conversation (not a generic rule of thumb) matters. Once you’ve got a sense of your real numbers, that’s when we get into the specifics — which areas fit your budget, what’s realistic for your timeline, and what a place like Grimsby’s waterfront or Binbrook’s growing subdivisions might actually mean for you.

What We’d Actually Suggest

If you’re in “we’re still saving” mode, here’s what tends to help:

  • Talk to a mortgage broker before assuming anything about what you can or can’t afford. Pre-approval numbers are often more encouraging than people expect.
  • Ask about your realistic monthly payment at 5%, 10%, and 20% down, so you see the real difference, not just the headline percentage.
  • Look into whether an FHSA or HBP makes sense for your situation before you keep saving the “regular” way.

The Bottom Line

Buying your first home isn’t about hitting one magic number. It’s about understanding your actual options, with real Canadian numbers, for your actual situation. Twenty percent down is one path, but it’s far from the only one, and for most first-time buyers, it’s not even the most common one.

If you’ve been putting off even starting the conversation because you assumed you weren’t ready, we’d love to chat. Even if you’re still a year away, we’re always happy to point you in the right direction.

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