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Buying a Home in PEI: First-Time Buyer Transfer Tax Exemption, Costs and Steps

Updated

Prince Edward Island charges a real property transfer tax, and first-time buyers who will live in the home can be exempt from it; the Island also limits how much land non-residents can hold. This page covers what is specific to Prince Edward Island. The national programs (the FHSA, the Home Buyers’ Plan and the federal tax credit) are the same in every province and are covered in the first-time home buyer guide.

The real property transfer tax and the first-time buyer exemption

PEI’s real property transfer tax is charged on the greater of the price and the assessed value. First-time buyers who will occupy the home can claim an exemption by filing a declaration. Under the Real Property Transfer Tax Act you must be a Canadian citizen or permanent resident, have lived in PEI for the six months before registration (or filed PEI tax returns in two of the last six years), never have held a principal residence or used the exemption before, and then live in the home for at least 183 consecutive days; the PEI land transfer tax calculator covers who qualifies and how it applies when there is more than one buyer.

Checks that matter in PEI

  • The Lands Protection Act: Under PEI's Lands Protection Act, a non-resident person or a corporation must apply to the Island Regulatory and Appeals Commission (IRAC) for approval before holding more than 5 acres of land or more than 165 feet of shore frontage in total. A resident is a Canadian citizen or permanent resident who has lived in PEI for at least 365 days in the 24 months before acquiring the land and files their tax return in PEI. This matters most for rural and waterfront properties; your lawyer confirms whether it applies.
  • Heating and wells: ask for a year of heating bills, and test well water and inspect septic systems outside Charlottetown and Summerside.

Other closing costs

Legal fees, title insurance and property tax adjustments make up most of the rest of the closing bill; the Prince Edward Island closing cost calculator totals them.

Where to look in Prince Edward Island

Down payment and mortgage

The minimum down payment and the mortgage stress test are federal rules and the same in every province: see the down payment calculator and Prince Edward Island mortgage rates. The Home Buyers’ Plan, the FHSA and the first-time home buyers’ tax credit can all go toward a purchase in Prince Edward Island.

Sources

The figures and rules on this page come from these sources, last checked against them on September 29, 2026. How we check facts.