First-Time Homebuyer Guide for London, Ontario: 2026

This first-time homebuyer guide for London, Ontario breaks the process down to three moving parts: how much cash you actually need up front, what the current lending rules let you borrow, and how competitive the market is the week you start looking. As a REALTOR® with Century 21, First Canadian who has walked London buyers through this process since 2018, I put all three pieces in one place here, with the programs that can put thousands of dollars back in your pocket before you ever get a key.

Key Takeaways

• The minimum down payment in London is 5% on the first $500,000 of a home's price, then 10% on the portion between $500,000 and $1.5 million, per CMHC's mortgage loan insurance rules.
• Ontario refunds eligible first-time buyers up to $4,000 in land transfer tax — enough to wipe out the tax owing on homes valued up to $368,000 entirely.
• You can combine an FHSA (up to $40,000 lifetime) with the Home Buyers' Plan (up to $60,000 from your RRSP) toward a down payment, and double both amounts with a partner who also qualifies.
• First-time buyers can get a 30-year mortgage amortization on an insured mortgage, a change the federal government made permanent for all first-time buyers (not just new-build purchasers) as of December 15, 2024.
• London's resale market picked up in September 2026, with 561 homes sold and an average price of $611,509, according to CREA's data for the London and St. Thomas Association of REALTORS® (LSTAR).

What "First-Time Buyer" Means in London, Ontario (and Why It Matters for Your Wallet)

In everyday conversation, "first-time buyer" just means you haven't owned a home before. For the government programs that can save you real money, though, the definition is more specific, and it's worth understanding before you assume you qualify.

For Ontario's land transfer tax refund, you (and your spouse, if you have one) must never have owned an eligible home, or any interest in one, anywhere in the world. If your spouse owned a home at any point during your marriage, neither of you qualifies for the refund, even if you personally never have. You also need to be at least 18, move into the home as your principal residence within nine months of closing, and, for agreements signed after November 14, 2016, be a Canadian citizen or permanent resident.

The First Home Savings Account (FHSA) uses a similar standard: you generally can't have lived in a home you or your spouse owned in the current year or the four preceding calendar years. That's a slightly more forgiving bar than Ontario's "never, anywhere" test, which is why I've had clients qualify for an FHSA withdrawal but not the land transfer tax refund, or vice versa. Check both sets of rules, or ask your accountant, rather than assuming one approval means the other follows automatically.

How Much Cash First-Time Buyers Need in London: Down Payments and the Programs That Shrink the Number

This is the question I get asked first, and the honest answer has a few layers to it.

The down payment itself. Under federal mortgage loan insurance rules, the minimum down payment on a home priced at $500,000 or less is 5%. Between $500,000 and $1.5 million, you need 5% on the first $500,000 plus 10% on the amount above that. On a $700,000 home, roughly London's upper-mid range, that works out to $25,000 plus $20,000, or $45,000 total. Homes priced above $1.5 million don't qualify for mortgage loan insurance at all, which means a larger minimum down payment negotiated directly with your lender.

The land transfer tax refund. Ontario charges land transfer tax on every purchase, but first-time buyers who qualify get a refund of up to $4,000, applied right at closing in most cases. Since there's effectively no land transfer tax owing on the first $368,000 of a home's value once the refund is applied, buyers at the lower end of London's market can see this tax disappear completely. You have up to 18 months after registration to apply if it wasn't credited automatically.

The FHSA. Introduced as a tax-sheltered way to save specifically for a first home, the FHSA lets you contribute up to $8,000 per year, up to a $40,000 lifetime maximum, with contributions deductible from your income the same way an RRSP contribution is. Money withdrawn to buy a qualifying first home isn't taxed. If you're buying with a partner who also qualifies as a first-time buyer, you can each have your own FHSA, which means up to $80,000 combined toward the same purchase.

The Home Buyers' Plan (HBP). This is the older, RRSP-based program, and it still has a role even alongside the FHSA. You can withdraw up to $60,000 from your RRSP to buy a first home, repayable over 15 years. For withdrawals made in 2026, the CRA has pushed the start of repayment out to the fifth year after your withdrawal year rather than the second, so a 2026 withdrawal means your first repayment is due in 2031. Combine the FHSA and HBP correctly and a couple can bring up to $200,000 toward a purchase from tax-advantaged sources alone, before touching other savings.

Local down payment help, if the timing works. The City of London also runs a Homeownership Down Payment Assistance Program: an interest-free, forgivable loan of up to 5% of the purchase price (maximum $25,000) for moderate-income renters buying a home priced at $500,000 or less, forgiven after 20 years of continuous occupancy. As of this writing, the intake window closed on October 9, 2026, with the program expected to reopen April 1, 2027, so it isn't something you can rely on today — but it's worth building into a spring 2027 plan if you're not quite ready to buy yet. Contact the City's Housing Programs team directly before assuming it's available.

Today's Lending Landscape: Rates and Amortizations for First-Time Buyers

The Bank of Canada held its target for the overnight rate at 2.25% at its September 2, 2026 announcement, with the next scheduled decision on October 28, 2026. That overnight rate is the anchor for variable mortgage pricing, and it also shapes where fixed rates land, so it's worth knowing before you sit down with a lender.

The bigger structural change for first-time buyers actually happened back in late 2024 and is still underappreciated: as of December 15, 2024, all first-time buyers became eligible for a 30-year amortization on an insured mortgage (not just those buying newly built homes), up from the previous 25-year maximum, and the price cap for mortgage loan insurance itself rose from $1 million to $1.5 million. Stretching your amortization from 25 to 30 years lowers your monthly payment, though it also means more interest paid over the life of the loan, so it's a trade-off worth running the numbers on rather than defaulting into automatically.

I always tell first-time buyers in London to get a mortgage pre-approval before we start touring homes, not after. It tells you your real budget, it locks in a rate for a window of time, and it means you can move quickly when the right place comes up, which matters more in a market like ours that can shift month to month.

London's Housing Market Right Now: What First-Time Buyers Are Actually Competing Against

First-time buyers often picture a market frozen in whatever headline they last read. London's reality in the fall of 2026 is more specific than that. According to data from the Canadian Real Estate Association for the London and St. Thomas Association of REALTORS® (LSTAR), 561 homes changed hands in September 2026, up 5.3% from September 2025 and an increase from August's 526 sales. The average price across the market was $611,509, up from $590,550 the month before.

That's a market with sales activity picking up, not one sitting still, and it's a reminder that "waiting for prices to drop further" has a real opportunity cost if the trend is moving the other way. At the same time, an average price doesn't tell you what a specific starter condo in Oakridge or a semi in Old East Village will cost you. That number comes from a search set up for your actual budget and the specific areas you're considering, not a citywide average, since London's neighbourhoods span a wide range of housing stock and price points.

A Step-by-Step Path to Your First Closing in London

Once the financing pieces are lined up, the process itself follows a fairly consistent order:

Get pre-approved first. A lender or mortgage broker reviews your income, debts, and down payment sources and tells you what you can actually borrow. This is also when you confirm which of the programs above you qualify for.

Define your must-haves versus nice-to-haves. In my experience, first-time buyers in London do best when they separate "needs a second bathroom" from "would love a finished basement" before they start touring, because the city's starter-home inventory rarely checks every box at once.

Make an offer with the right conditions. A financing condition and a home inspection condition protect you if something doesn't check out after you've made an offer. Waiving conditions can make an offer more competitive on a popular listing, but it shifts real risk onto you, and it's a decision I walk every client through individually rather than recommending as a default.

Get the home inspected and finalize financing. This is where your pre-approval becomes a firm mortgage commitment, tied to the specific property.

Close and move in. Your lawyer handles the legal transfer, the land transfer tax refund application if it wasn't processed automatically, and the final funds transfer. This is also the point where your FHSA or HBP withdrawal needs to be timed correctly against your closing date, so loop in your accountant before, not after.

Frequently Asked Questions About Buying Your First Home in London, Ontario

How much do I need for a down payment on a first home in London?
On a home priced at $500,000 or less, the minimum is 5%. Above that, up to $1.5 million, it's 5% on the first $500,000 plus 10% on the rest. A $650,000 home, for instance, needs roughly $40,000 (5% of $500,000 plus 10% of $150,000).

Can I really use the FHSA and the Home Buyers' Plan together?
Yes. The FHSA lets you put in up to $8,000 a year to a $40,000 lifetime limit, and the HBP lets you withdraw up to $60,000 from your RRSP separately. Used together by one buyer, that's up to $100,000 in tax-advantaged funds toward a first home; two qualifying buyers purchasing together can each use their own, doubling the combined total.

Is London's land transfer tax refund automatic, or do I have to apply?
Most lawyers apply it for you automatically at closing if you meet the eligibility rules. If it wasn't applied, you have up to 18 months after the property is registered in your name to apply directly for the refund of up to $4,000.

Is the City of London's down payment assistance program accepting applications right now?
Not currently. The intake window closed October 9, 2026, with the program expected to reopen April 1, 2027. Income and asset limits also apply (household income up to $113,700, liquid assets up to $100,000, home price up to $500,000), so confirm directly with the City's Housing Programs team on current status and whether you'd qualify before counting on it.

Is now a good time to buy in London, or should I wait?
That depends on your own financial readiness more than market timing. September 2026 sales were up both month-over-month and year-over-year, which tells me buyers waiting for a dramatically softer market may be waiting for something that isn't currently happening. I'd rather walk through your specific numbers than guess at a citywide answer.

Ready to Buy Your First Home in London?

Buying your first home means stacking several pieces correctly: the right down payment strategy, a mortgage pre-approval that reflects today's rates and amortization rules, and an offer built around your actual needs rather than a bidding-war impulse. None of it has to be guesswork.

I'm Gloria Roman with Century 21, First Canadian, and I've helped first-time buyers across London and Middlesex County get through this process since 2018. If you're ready to see what your budget actually looks like in today's market, call me at (647) 883-7135 or visit 519propertyfinder.com to schedule a free consultation and start your search.