According to the Canada Mortgage and Housing Corporation (CMHC, 2026), first-time buyers who strategically stack available government programs can reduce their out-of-pocket costs by tens of thousands of dollars. Most buyers leave money on the table simply because they don’t know these programs exist. Here’s every incentive available to Ontario first-time buyers in 2026.
💰 4 Core Programs to Stack
1
First Home Savings Account (FHSA)
Tax-deductible in, tax-free out
Tax-deductible in, tax-free out
The FHSA is the most powerful savings tool introduced in decades. Contribute up to $8,000/year (lifetime max $40,000) — contributions reduce your taxable income like an RRSP, and withdrawals for a first home are completely tax-free like a TFSA. Couples can each open an account for $80,000 combined. Open one today even if you aren’t buying for years — contribution room accumulates from the date you open.
2
RRSP Home Buyers’ Plan (HBP)
$60,000 per person, repaid over 15 years
$60,000 per person, repaid over 15 years
The HBP lets you withdraw up to $60,000 from your RRSP tax-free to buy your first home. Couples can withdraw up to $120,000 combined. In 2026, you can use FHSA and HBP together for the same purchase: that’s $100,000 per person ($200,000/couple) in tax-sheltered savings. Repay 1/15th of the HBP amount each year starting the second year.
3
Land Transfer Tax Rebate
Up to $8,475 in Toronto
Up to $8,475 in Toronto
Ontario first-time buyers receive a provincial LTT rebate of up to $4,000. Homes under $368,333 pay zero provincial land transfer tax after the rebate. In Toronto, an additional municipal LTT rebate of up to $4,475 applies, for a combined maximum of $8,475. Your lawyer automatically claims this at closing.
4
2026 HST Exemption on New Homes
Save up to $130,000 — time-limited
Save up to $130,000 — time-limited
On March 25, 2026, Premier Doug Ford announced the removal of the full 13% Ontario HST on new home purchases. Valid for purchases signed April 2026 – March 2027. On a $1M new build, that’s $130,000 in savings — the largest single incentive in Ontario real estate history. Applies to new construction only; confirm the exemption is reflected in your builder’s purchase agreement.
💡 Arthur’s Stacking Strategy
For a Toronto resale purchase at $800,000: FHSA withdrawal ($40,000 tax-free) + HBP ($60,000 RRSP withdrawal) + Land Transfer Tax rebate ($8,475) = over $20,000 in direct savings, plus the long-term tax benefit from FHSA contributions. Buying new construction in this window? Add $104,000 in HST savings. The math is compelling.
How to Claim These Incentives ↓
Open FHSA today → start contributing
↓
Confirm RRSP balance → plan HBP withdrawal
↓
Lawyer claims LTT rebate automatically at closing
↓
New build? Confirm HST exemption in purchase agreement
❓ FAQ
Q: Can new immigrants access these programs?
Yes, if you are a Canadian tax resident and have not lived in a home you or your spouse owned in the past 4 calendar years, you qualify as a first-time buyer for LTT rebates and HBP. FHSA requires Canadian residency and age 18+. FHSA also requires you be a first-time home buyer at the time of the qualifying withdrawal.
Q: What if I haven’t maxed out my FHSA before buying?
You can withdraw whatever is in the FHSA — you don’t need to reach the $40,000 maximum before buying. The key benefit is opening the account early so contribution room accumulates. Even a small balance benefits from tax-free withdrawal at closing.
Q: Does the 2026 HST exemption apply to condos under construction?
Yes, if you sign a purchase agreement between April 2026 and March 2027 for a new condo or house, the provincial HST portion (8%) is exempt. Confirm the exemption is reflected in your purchase agreement and consult a real estate lawyer to verify the federal GST treatment separately.
AZ
Arthur Zhao
Broker · FRI · ABR · SRS · MCNE · E-PRO | AZ Real Estate Partners
📞 416-277-3836 ｜ arthurzhao.realtor
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