5% on $500,000, 10% on the balance – up to 1 million dollars (CMHC insured mortgages)
*Update* The lending rules for CMHC have recently changed (December 2015)
You do need to put down at least 5% of the value of a home to be get a mortgage in Canada up to $500,000. These are the rules. They’re good actually because it means we live in a more stable country when it comes to the real estate market. You’d think you’d want to be able to get a home with nothing down, but that would make us a lot like the U.S. before the recession. Not a great prospect.
It’s not hard to calculate 5% down payments, but I thought I would show you what they look like for some home values. Here you can see how much you need for a down payment for homes at $50,000 increments:
|House Cost||5% Down Payment|
When it comes to home worth over $500,000 any additional amount on the value of the home must be purchased with a 10% down payment.So, can you get a place in Edmonton for $150,000? Sure you can! A smaller condo for that much would be easy to find. It wouldn’t be hard to save up the $7,500 to get it either. And if you want an average house, well expect to pay about $350,000 for it and you’ll need to put down $17,500 to get that. You can find houses for as little as $250,000 in Edmonton, but they will need work for sure.
|House Cost||5% of 500k||Balance Over $500,000||10% of Balance||Total Down Payment (5% + 10%)|
Houses over 1 million require $20 down, and at that point, CMHC Insurance is not needed.
Is it a good idea to put more money down on your house? Absolutely – you can put down as much as you want or can afford. But many people just put down the minimum – especially with first time home purchases.
To learn more about how you can get your first home, read Can I Afford to Buy a Home?
by +Alan F Macdonald REALTOR® | Copyright © – gimme-shelter.com