First-time buyers
First-Time Buyer Programs in Ontario That Are Actually Real
The FHSA, the Home Buyers' Plan, and the land transfer tax rebate — what each one actually does, what doesn't apply if you're buying in Milton rather than Toronto, and what to verify before you count on any of it.
Three real programs come up constantly with first-time buyers, and the aggregator sites that explain them tend to bundle Toronto-specific numbers in with the general ones — which matters, because a Milton purchase does not get everything a Toronto purchase does. Here is what each program actually is, and which one does not apply to you.
The three programs
FHSA — the First Home Savings Account
A federal account that works like an RRSP going in and a TFSA coming out: contributions are tax-deductible, and a withdrawal toward your first home is entirely tax-free with nothing to repay. It carries an annual contribution limit and a lifetime cap, both set federally and both worth confirming at the bank you open it with, since program limits do get adjusted.
The Home Buyers' Plan (HBP)
Lets a first-time buyer withdraw funds from an RRSP to put toward a home, repaid back into the RRSP over a number of years with no interest, rather than taxed as income the way a normal RRSP withdrawal would be. The FHSA and the HBP can generally both be used toward the same purchase, provided you qualify for each on its own terms.
The Ontario land transfer tax rebate
Every purchase in Ontario triggers a provincial land transfer tax, calculated on the purchase price. First-time buyers get a rebate against it, which can fully cover the tax on a home up to a certain price and reduces it above that. This is the one that actually applies if you are buying in Milton.
What does not apply if you are buying in Milton
The City of Toronto charges its own, separate municipal land transfer tax on top of the provincial one, and Toronto has its own first-time buyer rebate against that municipal tax. Milton is in Halton Region, not the City of Toronto — a Milton purchase only ever triggers the provincial land transfer tax, so only the provincial rebate applies. Treat any total figure that adds a Toronto municipal rebate into a Milton number as wrong, because it is combining two different taxes that do not both exist here.
What to actually verify before you count on any of it
Contribution limits, lifetime caps, and the price threshold the land transfer tax rebate fully covers are all set by government and adjusted from time to time. I am deliberately not quoting exact dollar figures here, because the number that is accurate the week I write this can be stale by the time you read it. Confirm the current limits with your bank for the FHSA and HBP, and with your real estate lawyer for the land transfer tax rebate specifically on your purchase — both take minutes to confirm and neither should be assumed from a blog post, including this one.
None of these programs change the actual buying process — that still runs the way it always does. What they change is how much of your own cash you need to bring to it, which is worth knowing before you start looking, not after you have made an offer.
For the current limits, each with the date it was checked and a link to the government page it comes from, see buying your first home in Milton.
Talk it through
If this raised a question specific to your situation, the fastest way through it is a short conversation — free, no obligation.
REALTOR® · Durrani Real Estate Group
Century 21 Property Zone Realty Inc., Brokerage