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A down payment is the portion of a home’s purchase price a buyer pays upfront from their own funds, with the mortgage covering the rest. Canada’s minimum is tiered: 5% of the first $500,000, 10% of the portion from $500,000 to $1.5 million, and 20% at $1.5 million and above.
The minimum down payment is calculated in layers, not as one flat percentage of the whole price. The first $500,000 of the purchase price needs only 5% down; the portion between $500,000 and $1.5 million needs 10% down; and any amount at or above $1.5 million needs 20% down. Higher-priced homes blend all three tiers into a single required down payment.
The size of the down payment directly sets the loan-to-value ratio: less than 20% down means an LTV above 80% and a high-ratio mortgage that must be insured. Down payment funds can come from savings, a gifted amount from an immediate family member, or registered withdrawals through the Home Buyers’ Plan or a First Home Savings Account.
Minimum down payment = 5% × (first $500,000) + 10% × (portion from $500,000 to $1.5M) + 20% × (portion above $1.5M)
Tiered by price: 5% on the first $500,000, 10% on the portion from $500,000 to $1.5 million, and 20% at $1.5 million and above.
$1.5M insured cap: since December 15, 2024, homes priced up to $1.5 million can still qualify for an insured, low-down-payment mortgage — up from the previous $1 million cap.
20% minimum for most rentals: non-owner-occupied rental properties generally require at least 20% down, regardless of price.
Registered savings can help: the Home Buyers’ Plan allows an RRSP withdrawal of up to $60,000 per person, and a First Home Savings Account allows up to $8,000/year and $40,000 lifetime, both usable toward a down payment.
A buyer purchases a home for $700,000:
$25,000 + $20,000 = $45,000, equal to 6.4% of the $700,000 purchase price ($45,000 ÷ $700,000 = 6.43%).
Definitions reflect Canadian federal and provincial rules as of the “Updated” date above. Not advice for any specific file.
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