What is the minimum down payment in Canada in 2026?

The minimum down payment depends on the purchase price. For homes up to $500,000: 5%. For homes between $500,000 and $1,499,999: 5% on the first $500,000 plus 10% on the portion above $500,000. For homes $1,500,000 and over: 20% minimum — high-ratio (CMHC insured) mortgages are not available above $1,499,999. These minimums were updated in December 2024 when the federal government raised the insured mortgage ceiling from $999,999 to $1,499,999.

What is CMHC mortgage insurance?

CMHC (Canada Mortgage and Housing Corporation) mortgage insurance — officially called mortgage default insurance — is required on any mortgage where the down payment is less than 20%. It protects the lender (not you) if you default. The premium is calculated as a percentage of the mortgage amount and added to your mortgage balance. As of 2026, premiums range from 4.00% (5% down payment) to 2.80% (10–14.99% down) to 0.60% (15–19.99% down). On a $700,000 home with 5% down, the CMHC premium adds approximately $26,600 to your mortgage.

Is it better to put 5% or 20% down?

The math favours a larger down payment if you have the funds. Putting 20% down eliminates CMHC insurance entirely (a premium of 2.8%–4% of the mortgage), gives you a lower mortgage balance, and typically results in a slightly lower interest rate. However, depleting your savings for a 20% down payment is risky — homeowners should keep 3–6 months of expenses in an accessible emergency fund plus funds for closing costs and early home maintenance. If reaching 20% means wiping out all liquid savings, 10% or 15% may be more prudent.

Can I use my RRSP for a down payment?

Yes — through the First Home Savings Account (FHSA) or the Home Buyers Plan (HBP). The FHSA (introduced in 2023) lets first-time buyers contribute up to $8,000/year (lifetime max $40,000) and withdraw tax-free for a first home purchase with no repayment required. The HBP lets you withdraw up to $60,000 (increased from $35,000 in April 2024) from your RRSP, which must be repaid over 15 years starting the second year after withdrawal. Using both the FHSA and HBP allows up to $100,000+ in registered funds toward a first home.

Does the down payment cover all my upfront costs?

No — budget for additional closing costs of 1.5%–4% of the purchase price on top of the down payment. These include: land transfer tax (provincial and potentially municipal), legal fees ($1,500–$2,500), home inspection ($400–$700), title insurance (~$300), moving costs, and immediate maintenance or setup costs. First-time buyers in most provinces receive a land transfer tax rebate that partially offsets this cost.

How Much Down Payment Do I Need in Canada? (2026)

Your down payment is the biggest upfront variable in buying a Canadian home. Here is what the minimum rules require, what mortgage default insurance actually costs, and how to think about the optimal down payment for your situation.

Minimum down payment by home price (2026)

Purchase price	Minimum down payment	Minimum amount example
Up to $500,000	5% of full price	$25,000 on a $500,000 home
$500,001–$999,999	5% on first $500K + 10% on remainder	$57,500 on an $800,000 home*
$1,000,000–$1,499,999	5% on first $500K + 10% on remainder	$107,500 on a $1,250,000 home*
$1,500,000 and over	20% minimum (no CMHC available)	$300,000 on a $1,500,000 home

*These amounts reflect the updated rules in effect since December 15, 2024, which raised the insured mortgage ceiling from $999,999 to $1,499,999.

Calculation example: $800,000 home, minimum down payment

Portion	Rate	Amount
First $500,000	× 5%	$25,000
Remaining $300,000	× 10%	$30,000
Total minimum down payment		$55,000

CMHC mortgage default insurance premiums

Any mortgage with a down payment below 20% requires mortgage default insurance (from CMHC, Sagen, or Canada Guaranty). The premium is added to your mortgage balance.

Down payment %	CMHC premium (% of mortgage)
5.00%–9.99%	4.00%
10.00%–14.99%	3.10%
15.00%–19.99%	2.80%
20%+	0% (no insurance required)

Premium cost examples on a $700,000 home

Down payment	Mortgage amount	CMHC premium	Premium in $ added to mortgage
5% ($35,000)	$665,000	4.00%	$26,600
10% ($70,000)	$630,000	3.10%	$19,530
15% ($105,000)	$595,000	2.80%	$16,660
20% ($140,000)	$560,000	0%	$0

Going from 5% to 20% down on a $700,000 home:

Requires $105,000 more cash upfront
Saves $26,600 in CMHC insurance added to the mortgage
Lowers the mortgage balance by $105,000
Eliminates ongoing interest on that additional $105,000 (at 5.25% over 25 years, that is approximately $77,000 in interest savings)

Total value of the 20% vs 5% difference: ~$103,600 — not counting the reduced monthly payment.

The first home buyer advantage: FHSA + HBP

If you are a first-time buyer, registered savings can significantly accelerate your down payment:

First Home Savings Account (FHSA)

Contribute up to $8,000/year (lifetime max $40,000)
Contributions are tax-deductible (like an RRSP)
Withdrawals for a qualifying first home are completely tax-free (like a TFSA)
No repayment required
Opens to Canadians age 18–71 who are first-time buyers and have not owned a principal residence in the current or previous 4 years

Home Buyers’ Plan (HBP)

Withdraw up to $60,000 from your RRSP tax-free for a first home
Must repay over 15 years (starting 2 years after the year of withdrawal)
$60,000 per borrower — couples can access $120,000 combined
Must be a first-time buyer (no principal residence owned for 4+ years)

Combined first-time buyer example:

FHSA: $40,000 (accumulated over 5 years)
HBP: $60,000 from RRSP
Other savings: $30,000
Total down payment available: $130,000

On an $800,000 home, $130,000 represents 16.25% down — one step away from avoiding CMHC entirely.

Down payment vs emergency fund: do not deplete everything

A common first-time buyer mistake is putting every dollar into the down payment — including the emergency fund. After closing, homeowners face:

Immediate moving costs
Home maintenance and purchases (30–50% of homes need a repair in the first year)
Closing costs not covered by the down payment
Property tax adjustments at closing

Maintain at minimum:

3 months of expenses in a liquid emergency fund (separate from down payment)
1.5%–4% of purchase price in cash for closing costs

If maximizing your down payment means going into the home with zero liquid savings, wait 3–6 months and save more.

Land transfer tax: an often-forgotten upfront cost

Province	LTT rate (approximate on $700K)	First-time buyer rebate
Ontario	~$9,475 provincial	Up to $4,000 rebate
Toronto (add municipal)	+$9,475 municipal	Up to $4,475 additional rebate
BC	~$10,000	Up to $8,000 for homes under $500K
Alberta	No land transfer tax	—
Quebec	~$7,000	No rebate
Nova Scotia	~$4,200	No rebate

How Much House Can I Afford in Canada? — Qualifying based on your income
How Much Do I Need to Retire? — Balancing home ownership with long-term savings
How Much RRSP Room Do I Have? — Maximizing RRSP before using HBP