Short Answer
Buying a house is the largest financial transaction most Canadians make. This checklist covers what to verify before you make an offer, not just before you close.
Down Payment Readiness
| Home price | Minimum down payment | CMHC insurance required? |
|---|---|---|
| Up to $500,000 | 5% | Yes |
| $500,001–$999,999 | 5% on first $500K + 10% on remainder | Yes |
| $1,000,000+ | 20% | No (not eligible for insured mortgage) |
Beyond the minimum, check where your funds are coming from:
| Source | Rule |
|---|---|
| Personal savings | No restrictions |
| RRSP (Home Buyers’ Plan) | Up to $60,000 per person; must have been in RRSP 90+ days; repay over 15 years |
| FHSA | Entire balance; tax-free; no repayment required |
| Gift from family | Lenders require a signed gift letter confirming no repayment expected |
| LOC or borrowed funds | Cannot be used as down payment for insured mortgage |
Mortgage Qualification Check
Before engaging a lender, understand what you can realistically borrow:
| Rule of thumb | Guideline |
|---|---|
| Gross Debt Service (GDS) ratio | Housing costs should not exceed 32–39% of gross monthly income |
| Total Debt Service (TDS) ratio | All debt payments should not exceed 44% of gross monthly income |
| Stress test rate | Qualify at your rate + 2% or 5.25%, whichever is higher |
Example: On a household income of $130,000, most lenders will approve a mortgage of approximately $650,000–$750,000 at current rates, after stress testing. Run your numbers with an online mortgage calculator before assuming a budget.
Credit Score Check
| Score range | Likely outcome |
|---|---|
| 760+ | Best rates, full product access |
| 720–759 | Good rates, full product access |
| 680–719 | Standard rates, most lenders |
| 620–679 | May qualify, limited options, higher rates |
| Below 620 | Typically requires B-lender or private lender |
Pull your credit report free at Equifax.ca and TransUnion.ca before applying. Dispute any errors — they can take 30–60 days to correct.
Closing Costs Budget
| Cost | Typical range |
|---|---|
| Land transfer tax (provincial) | 0.5%–2.5% of purchase price |
| Land transfer tax (Toronto city — additional) | Up to 2% |
| Legal fees | $1,500–$2,500 |
| Title insurance | $200–$400 |
| Home inspection | $400–$600 |
| Property tax adjustment at closing | Depends on timing |
| Moving costs | $1,000–$5,000+ |
| CMHC insurance premium (if applicable) | 2.8%–4% of mortgage, added to balance |
First-time buyers may qualify for federal and provincial first-time home buyer rebates on land transfer tax. Confirm your eligibility before closing.
Ongoing Ownership Costs Often Underestimated
| Cost | Annual estimate |
|---|---|
| Property tax | $3,000–$10,000+ depending on municipality |
| Home insurance | $1,200–$3,000/year |
| Maintenance and repairs | 1%–2% of home value per year |
| Condo fees (if applicable) | $300–$1,500/month |
| Utilities (if not included in condo) | $200–$500/month |
The 1% rule: budget 1% of your home’s value annually for maintenance. On a $750,000 home, that is $7,500 per year — far more than most first-time buyers expect.
Property Due Diligence
| Check | Why it matters |
|---|---|
| Home inspection | Identifies structural, mechanical, and safety issues |
| Condo status certificate | Reveals reserve fund health, special assessments, pending litigation |
| Survey or title search | Confirms boundaries, encumbrances, easements |
| Zoning and permitted uses | Especially if you plan renovations or a secondary suite |
| Insurance availability | Some properties are difficult to insure (older knob-and-tube wiring, oil tanks, location) |
| Permit history | Verify any additions or renovations were permitted |
For condos: a reserve fund below 70% funded can mean upcoming special assessments (surprise lump-sum charges to all unit owners).
Government Programs Available
| Program | Benefit |
|---|---|
| First Home Savings Account (FHSA) | Up to $40,000 tax-deductible contributions; withdrawals tax-free for first home |
| Home Buyers’ Plan (HBP) | Withdraw up to $60,000 from RRSP; repay over 15 years |
| First-Time Home Buyer Tax Credit | $10,000 credit on your return = $1,500 federal tax reduction |
| GST/HST New Housing Rebate | Partial rebate on GST/HST for new construction under threshold |
| Provincial first-time buyer rebates | Land transfer tax rebates vary by province |
Before You Make an Offer: Checklist
- Down payment source confirmed and accessible (including 90-day RRSP seasoning if using HBP)
- Mortgage pre-approval in hand with confirmed rate hold
- Credit report pulled and errors corrected
- Total closing costs budgeted (1.5%–4% of purchase price)
- Monthly carrying costs calculated including property tax, insurance, maintenance, and utilities
- Home inspection condition included in offer (do not waive unless you accept full risk)
- For condos: status certificate reviewed before waiving conditions
- Government programs (FHSA, HBP, first-time buyer credit) confirmed and available
Bottom Line
Most Canadians focus only on the down payment and mortgage payment. The checklist above captures the full picture — closing costs, ongoing ownership costs, credit readiness, and property due diligence — that determines whether a purchase is sustainable long term.