What is the new insured mortgage limit in Canada?

The insured mortgage limit was raised from $999,999 to $1,499,999 (effectively $1.5 million) as part of the 2024 federal housing policy changes. This means buyers purchasing homes priced up to $1,499,999 can now get a mortgage with less than 20% down payment and CMHC (or Sagen/Canada Guaranty) mortgage insurance. Previously, any home priced at $1 million or above required a minimum 20% down payment with no insurance available. This change significantly reduces the cash needed upfront for higher-priced homes.

How much down payment do I need for a $1.5 million home in Canada?

Under the new rules, you need a minimum of 5% on the first $500,000 ($25,000) plus 10% on the portion from $500,001 to $1,499,999 ($99,999, so up to $100,000). For a $1,499,999 home, the minimum down payment is approximately $125,000 — roughly 8.3% of the purchase price. For comparison, under the old rules, you needed 20% minimum for any home at $1 million or above, which would be $300,000 for a $1.5M home. The new rules save you approximately $175,000 in required down payment.

Does the $1.5 million insured limit apply to investment properties?

No. The insured mortgage program (with less than 20% down payment) only applies to owner-occupied properties. Investment properties still require a minimum 20% down payment and do not qualify for CMHC insurance regardless of price. The $1.5 million insured limit applies to homes you intend to live in as your primary residence.

$1.5 Million Insured Mortgage in Canada

The federal government raised the insured mortgage cap from $999,999 to $1,499,999 in 2024, opening up CMHC-insured mortgages with less than 20% down for homes in Canada’s most expensive markets. This is one of the most significant mortgage policy changes in years — here is how it works and who benefits.

What changed

Old rules vs new rules

Factor	Old Rule	New Rule
Maximum insured home price	$999,999	$1,499,999
Minimum down payment under $500K	5%	5% (unchanged)
Minimum down payment $500K–$999,999	10% on the portion above $500K	10% on the portion above $500K (unchanged)
Minimum down payment $1M–$1.5M	20% (no insurance available)	10% on the portion above $500K
Insurance available above $1M	No	Yes (up to $1,499,999)
Properties at $1.5M+	20% down required	20% down required (unchanged)

Down payment comparison

Purchase Price	Old Minimum Down	New Minimum Down	Cash Savings
$800,000	$55,000 (5% on $500K + 10% on $300K)	$55,000	No change
$999,999	$75,000	$75,000	No change
$1,000,000	$200,000 (20% required)	$75,000 (5% + 10% sliding scale)	$125,000 saved
$1,100,000	$220,000 (20% required)	$85,000	$135,000 saved
$1,200,000	$240,000 (20% required)	$95,000	$145,000 saved
$1,300,000	$260,000 (20% required)	$105,000	$155,000 saved
$1,400,000	$280,000 (20% required)	$115,000	$165,000 saved
$1,499,999	$300,000 (20% required)	$125,000	$175,000 saved
$1,500,000+	$300,000+ (20% required)	$300,000+ (20% required)	No change

Key takeaway: For a $1.3 million home, the required cash dropped from $260,000 to $105,000 — a $155,000 reduction. This is transformative for buyers in Toronto and Vancouver where starter homes regularly exceed $1 million.

CMHC insurance premiums at higher price points

Premium rates

Down Payment %	CMHC Premium Rate
5.00–9.99%	4.00%
10.00–14.99%	3.10%
15.00–19.99%	2.80%

Premium cost examples

Purchase Price	Down Payment	Mortgage	CMHC Premium (4.00%)	Total Mortgage (with insurance)	Monthly Payment (5.5%, 25 yr)
$1,000,000	$75,000 (7.5%)	$925,000	$37,000	$962,000	$5,866
$1,100,000	$85,000 (7.7%)	$1,015,000	$40,600	$1,055,600	$6,437
$1,200,000	$95,000 (7.9%)	$1,105,000	$44,200	$1,149,200	$7,008
$1,300,000	$105,000 (8.1%)	$1,195,000	$47,800	$1,242,800	$7,579
$1,499,999	$125,000 (8.3%)	$1,375,000	$55,000	$1,430,000	$8,721

The CMHC premium at these price levels is significant — $37,000 to $55,000 added to your mortgage. This is the trade-off for the lower down payment.

Is it worth paying the insurance premium?

Option A: Insured (New Rules)	Option B: Uninsured (20% down)
$1,200,000 purchase	$1,200,000 purchase
$95,000 down (7.9%)	$240,000 down (20%)
$1,105,000 mortgage	$960,000 mortgage
$44,200 CMHC premium	$0 premium
$1,149,200 total mortgage	$960,000 total mortgage
Monthly payment: $7,008	Monthly payment: $5,855
Cash needed: $95,000 + closing costs	Cash needed: $240,000 + closing costs
$145,000 less cash needed	$1,153 lower monthly payment

The trade-off: You save $145,000 in cash upfront but pay $1,153 more per month and carry $189,200 more in total mortgage debt (including the insurance premium). Over 25 years, the insured option costs approximately $155,000 more in interest.

When Option A makes sense: You have $95,000 but not $240,000. Waiting to save the additional $145,000 could take 3–5+ years, during which prices may rise further.

When Option B makes sense: You have the 20% available and want lower payments and less total cost.

Who benefits most

Primary beneficiaries

Buyer Profile	How They Benefit
First-time buyers in Toronto/Vancouver	Can buy a starter home (townhouse, small detached) that costs $1M–$1.5M with 5–10% down instead of 20%
Move-up buyers	Can bridge the gap from a condo to a house without needing $250K+ in cash
Dual-income households	High enough income to qualify but not enough savings for 20% on a $1M+ home
New-build buyers	Combines with 30-year amortization for first-time buyers — maximum affordability

Who does NOT benefit

Buyer Profile	Why
Buyers in affordable markets	Homes under $1M — rules did not change for them
Investors	Investment properties still require 20% down
Buyers above $1.5M	Still need 20% down — no insured option
Buyers who already have 20% saved	Insured route adds premium cost they do not need

Income required to qualify

The stress test still applies. You need to qualify at the higher of your contract rate + 2% or 5.25%.

Purchase Price	Down Payment	Mortgage (incl. CMHC)	Monthly Payment at Stress Test Rate	Required Household Income (approx.)
$1,000,000	$75,000	$962,000	$6,689	~$200,000
$1,100,000	$85,000	$1,055,600	$7,339	~$220,000
$1,200,000	$95,000	$1,149,200	$7,990	~$240,000
$1,300,000	$105,000	$1,242,800	$8,640	~$260,000
$1,499,999	$125,000	$1,430,000	$9,942	~$300,000

Approximate — assumes 7.5% stress test rate, 25-year amortization, GDS 39%, property tax and heating estimated, no other debts

Reality check: A $1.3M home requires approximately $260,000 household income to qualify. This limits the benefit to higher-income households — but those are exactly the households that were locked out of Toronto and Vancouver’s $1M+ markets despite strong incomes.

Combining with other 2024 policy changes

Maximum benefit stack

Policy Change	Benefit
$1.5M insured cap	Less down payment required (5–10% instead of 20%)
30-year amortization (first-time buyers, new builds)	Lower monthly payments (8–12% reduction)
Combined effect	Can buy a $1.2M home with $95,000 down and 30-year amortization

Worked example: Maximum benefit

Factor	Old Rules	New Rules (Stacked)
Purchase price	$1,200,000	$1,200,000
Down payment required	$240,000 (20%)	$95,000 (7.9%)
Amortization	25 years (insured cap)	30 years (first-time/new-build)
Monthly payment	$5,855 (uninsured, 25 yr)	$6,395 (insured, 30 yr)
Cash needed	$240,000	$95,000
Cash savings	—	$145,000

The stacked benefit lowers the cash barrier dramatically while keeping the monthly payment roughly comparable.

Market impact

Markets where this matters most

City	Avg. Detached Price (2025)	Previously Required 20%?	Newly Insurable?
Toronto	$1,250,000	Yes — $250,000 down	✅ Now insured at ~$100,000 down
Vancouver	$1,550,000	Yes — $310,000 down	Partially — some homes now insurable
Victoria	$900,000	No — already under $1M	No change
Ottawa	$680,000	No — already under $1M	No change
Calgary	$620,000	No — already under $1M	No change
Hamilton	$850,000	No — already under $1M	No change
Kelowna	$900,000	No — already under $1M	No change

The policy primarily benefits Toronto and Vancouver buyers, where average detached home prices straddle or exceed the $1M threshold.

Risks and considerations

Risk	Details
Larger mortgage = more debt	Carrying $1.1M+ in mortgage debt means higher vulnerability to rate increases at renewal
CMHC premium is substantial	$37,000–$55,000 added to your debt — this is not free money
Slower equity build	With only 5–10% down on a $1M+ home, you start with very little equity cushion
Market downturn risk	A 10% price decline on a $1.2M home is $120,000 — with only $95,000 down, you are immediately underwater
Stress test still applies	The lower down payment does not change the income needed to qualify
Higher payments at renewal	If rates are higher at your 5-year renewal, the payment increase on a $1.1M+ mortgage is significant

Closing costs at this price level

Cost	Amount (Ontario)	Amount (BC)
Land transfer tax	$22,475–$32,475	PTT: $28,000–$40,000
Toronto municipal LTT (if applicable)	$22,475–$32,475	N/A
Legal fees	$2,000–$3,500	$2,000–$3,500
Home inspection	$500–$800	$500–$800
Appraisal	$400–$600	$400–$600
Title insurance	$300–$500	$300–$500
Total closing costs	$48,000–$70,000 (Toronto)	$31,000–$45,000

Important: At the $1M+ level, closing costs are substantial — especially in Toronto with double land transfer tax. Budget $50,000–$70,000 above your down payment.