First-Time Homebuyer Rebate

Learn how the First-Time Homebuyer Rebate works in Canada, what it covers, who qualifies, and how it helps reduce closing expenses.

First-Time Homebuyer Rebate

May 22, 2025


What the First-Time Homebuyer Rebate?

The First-Time Homebuyer Rebate is a government program that provides financial relief to eligible buyers by refunding all or part of the land transfer tax paid at closing.

Why does the First-Time Homebuyer Rebate Matter in Real Estate?

In Canada, first-time buyers often face high entry costs. This rebate lowers one of the major closing expenses and is available at both the federal and provincial levels (e.g., Ontario, British Columbia).

Eligibility generally requires:
  • Buyer has never owned property anywhere in the world
  • Property is used as a principal residence
  • Buyer is a Canadian citizen or permanent resident
Benefits may include:
  • Up to $4,000 in Ontario (provincial rebate)
  • Up to $4,475 in Toronto (municipal rebate)
  • Up to $8,000 in British Columbia
Buyers must apply during or shortly after closing. It does not affect mortgage qualification but can reduce the cash needed upfront.
Understanding the rebate helps first-time buyers plan their finances and lower the initial barrier to homeownership.

Example of the First-Time Homebuyer Rebate in Action

A first-time buyer in Toronto receives a total rebate of $8,475 — covering both provincial and municipal land transfer tax portions.

Key Takeaways

  • Reduces land transfer tax for first-time buyers.
  • Offered provincially and municipally.
  • Requires specific eligibility.
  • Must apply at or after closing.
  • Eases upfront purchase costs.

Related Terms

Additional Terms

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Mortgagee in Possession

A mortgagee in possession is a lender who takes control of a property after borrower default, but before foreclosure or power of sale. The lender. more

Lease Surrender Agreement

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Green Infrastructure

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Escrow Holdback

An escrow holdback is a portion of funds withheld at closing and held in escrow until specific conditions are met, such as completion of repairs,. more

Underused Housing Tax

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