Last Updated on April 4, 2024

What is the Minimum Downpayment to Buy a House in Canada?

By Alan F Macdonald

Short Answer

5% on $500,000, 10% on the balance up to $1 million and 20% for homes that are $1 million or more. Also note that if you put 20% down, you don’t need CMHC mortgage insurance.

Long Answer

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 more like the U.S. before the recession. Not a great prospect.

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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
$150,000 $7,500
$200,000 $10,000
$250,000 $12,500
$300,000 $15,000
$350,000 $17,500
$400,000 $20,000
$450,000 $22,500
$500,000 $25,000

When it comes to homes worth more than $500,000 any additional amount on the value of the home must be purchased with a 10% down payment.

So:

House Cost 5% of 500k Balance Over $500,000 10% of Balance Total Down Payment (5% + 10%)
$550,000 $25,000 $50,000 $5,000 $30,000
$650,000 $25,000 $150,000 $15,000 $40,000
$750,000 $25,000 $250,000 $25,000 $50,000
$950,000 $25,000 $450,000 $45,000 $70,000

Houses over $1 million require 2%0 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?

 

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