Government Assistance for Home Buyers in Ontario

Buying a home is one of the most significant investments many people make in their lives.

For first-time home buyers in Ontario, the process can be daunting, especially with the rising real estate prices. Fortunately, various government programs and incentives are available to help ease the financial burden.

In this blog, we will explore the different types of government assistance available to home buyers in Ontario, providing a comprehensive guide to help you navigate your home buying journey.

1. First-Time Home Buyer Incentive

The First-Time Home Buyer Incentive (FTHBI) is a shared-equity mortgage with the Government of Canada. This program aims to reduce monthly mortgage payments without increasing the amount you need to save for a down payment.

How it works: The government offers 5% of the purchase price of an existing home and either 5% or 10% for a newly constructed home. This amount is a loan that you will need to repay after 25 years or when you sell the home, whichever comes first.

Eligibility: You must be a first-time home buyer, your household income must be $120,000 or less, and your total borrowing must not exceed four times your qualifying income.

Example: If you purchase a new home for $400,000, the government could provide $40,000, making your mortgage $360,000 instead of $400,000, thereby reducing your monthly payments.

2. Home Buyers’ Plan (HBP)

The Home Buyers’ Plan (HBP) allows first-time home buyers to withdraw up to $35,000 from their Registered Retirement Savings Plan (RRSP) to buy or build a qualifying home.

How it works: The amount withdrawn is not taxed if repaid to the RRSP within a 15-year period. This can provide significant immediate funds for a down payment or other home buying costs.

Eligibility: You must be a first-time home buyer, and the RRSP funds must have been in your account for at least 90 days before withdrawal.

Example: If you and your spouse both qualify, you can each withdraw $35,000 from your RRSPs, giving you a total of $70,000 to use toward your home purchase.

3. Land Transfer Tax Refund

In Ontario, first-time home buyers may be eligible for a refund of all or part of the land transfer tax (LTT) they paid.

How it works: The maximum refund is $4,000. This means that if the purchase price of your home is $368,000 or less, you will not pay any LTT. For homes over this amount, the refund will cover a portion of the LTT.

Eligibility: You must be a first-time home buyer, be at least 18 years old, occupy the home as your principal residence within nine months of the date of transfer, and not have previously owned a home.

Example: If you buy a home for $450,000, the land transfer tax is approximately $5,475. With the maximum refund of $4,000, you would only pay $1,475 in land transfer tax.

4. Ontario Energy and Property Tax Credit (OEPTC)

The Ontario Energy and Property Tax Credit (OEPTC) is designed to help low-to-moderate-income residents with property taxes and the sales tax on energy.

How it works: The credit is part of the Ontario Trillium Benefit and is paid monthly or as a lump sum. The amount you receive depends on your income, age, and family size.

Eligibility: You must be a resident of Ontario and pay property tax or rent, among other criteria.

Example: A single person earning $25,000 annually could receive a significant credit to offset property taxes and energy costs, making homeownership more affordable.

5. GST/HST New Housing Rebate

The GST/HST New Housing Rebate provides a rebate for part of the GST or HST you pay on the purchase price or cost of building your new home.

How it works: The rebate is available for new or substantially renovated homes, including single-family homes, townhouses, and condominiums. The maximum rebate is 36% of the GST or the federal portion of the HST paid, up to a maximum of $6,300.

Eligibility: You must be the purchaser of the home, and it must be your primary place of residence.

Example: If you buy a new home costing $350,000, the GST portion would be approximately $17,500. The rebate could be up to $6,300, reducing your overall tax burden.

6. First-Time Home Buyer Tax Credit (HBTC)

The First-Time Home Buyer Tax Credit (HBTC) provides a non-refundable tax credit of up to $750 for first-time home buyers.

How it works: The credit is calculated by multiplying the lowest personal income tax rate for the year by $5,000. For 2024, the credit is $750.

Eligibility: You must be a first-time home buyer and have bought a qualifying home.

Example: After purchasing your first home, you can claim the $750 credit when filing your tax return, reducing your tax payable by $750

7. Affordable Housing Programs

Various municipalities in Ontario offer affordable housing programs to help lower-income families and individuals achieve homeownership.

How it works: These programs can include down payment assistance, below-market mortgage rates, and other financial aid.

Eligibility: Criteria vary by program and municipality but generally target low-to-moderate-income households.

Example: The City of Toronto’s Affordable Home Ownership Program provides down payment assistance to eligible families, making home ownership more attainable in a high-priced market.


Navigating the home buying process can be challenging, but understanding the government assistance programs available in Ontario can make it more manageable.

From financial incentives like the First-Time Home Buyer Incentive and Home Buyers’ Plan to tax rebates and credits, these programs are designed to help first-time buyers overcome the financial hurdles associated with purchasing a home. By taking advantage of these programs, you can reduce your initial costs and make your dream of homeownership a reality.

If you are considering buying your first home, consult with The Tar Team to explore which programs you qualify for and how to best leverage them. With the right assistance, you can take the first steps toward owning your home in Ontario.