Buying a home in Toronto can feel like both your greatest dream and your toughest challenge. Sky-high prices, complicated rules, multiple costs, and stiff competition can be intimidating. This year, though, buyers who are well-prepared and strategic can still find a way—and maybe even thrive. Let’s make sense of the process, step by step.
1. Understand Your Financial Landscape
Toronto’s average home price hovers around C$1.06 million, meaning you’d need an annual household income of about C$232,000 to qualify comfortably.
Another estimate puts the needed household income at C$215,488—assuming a 20% down payment and reasonable mortgage terms. So yes—Toronto demands serious financial firepower or creative strategy.
2. Master the Down Payment Rules
The minimum down payment depends on home price:
≤ C$500,000: 5%
C$500K–1.5M: 5% on the first C$500K + 10% on the remainder
> C$1.5M: 20%
These minimums trigger mortgage default insurance if under 20%, adding additional cost.
3. Navigate Eligibility & First-Time Buyer Benefits
The Home Buyer’s Plan lets first-timers withdraw up to C$60K from your RRSP (C$120K for couples), to be repaid over 15 years.
The First-Time Home Buyer Incentive (FTHBI) may cover up to 5% for resale and 10% for new builds—but comes with income caps (~C$120K gross) and shared equity terms.
Additionally, Ontario may offer Land Transfer Tax rebates for first-time buyers.
4. Get Strategically Pre-Approved
A mortgage pre-approval anchors your budget, tells agents—or sellers—you’re serious, and frames your search realistically.
Use affordability calculators (from TD, Ratehub, etc.) to understand what you can afford—good debt-to-income scoring keeps GDS under ~35%.
5. Budget for More Than the Down Payment
Don’t forget closing costs—legal fees, land transfer taxes, title insurance, appraisals, and more can add 2–5% of purchase price.
Each of these adds up fast—plan ahead so you're not caught off guard.
6. Leverage Professional Help
A real estate agent with first-time buyer experience can smooth out the emotional turbulence and strategic decisions.
A mortgage broker may help you shop rates, especially with the new higher insured mortgage cap (up to C$1.5M) and 30-year amortizations now available.
Final Summary
Buying in Toronto in 2025 isn’t for the faint of heart—but neither is anything worth doing. If you’re thoughtful, financially organized, and proactive, you can still unlock homeownership. Know what you need to earn, satisfy the down payment rules, use first-time benefits, get pre-approved, budget smart, and lean on trusted professionals.
Frequently Asked Questions
Q: How much money do you need to make to buy a house in Toronto?
On average, a household income of around C$215,000–C$232,000 is required to afford Toronto real estate comfortably.
Q: What is the minimum down payment for a house in Toronto?
Up to C$500K: 5%
Between C$500K and C$1.5M: 5% on first C$500K + 10% on remainder
Above C$1.5M: 20%
Q: How much income do you need to buy a C$400,000 house in Canada?
Using affordability rules (~30% of income for mortgage), you'd need to make around C$96,000–C$100,000 annually to finance a C$400K home.
Q: How to buy a house for the first time in Ontario?
Check eligibility (must be a Canadian/Permanent Resident, no prior ownership in past 4 years, etc.)
Get pre-approved
Save for down payment and closing costs
Explore first-time incentives (HBTC, FTHBI, LTT rebate)
Make an educated offer—with home inspection included.
Q: What is the 4-year rule for first-time home buyers?
To qualify as a first-time home buyer, neither you nor your spouse/common-law partner can have owned a home anywhere in the world in the past four years.