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How much cash do you need to buy a home, beyond the down payment?

Published 22 September 2026

A buyer can save every dollar of the minimum down payment and still find that the amount due on closing day is larger. The down payment is only part of the cash needed to buy a home. Land transfer tax and closing costs sit on top of it, and each of those lines can be worked out, or at least given a range, well before an offer is signed.

The down payment follows a sliding rule

In Canada, the minimum down payment is 5% on a home priced at $500,000 or less. From $500,000 up to $1.5 million, it is 5% of the first $500,000 plus 10% of the portion above that. At $1.5 million or more, the minimum is 20% of the purchase price.

At a price equal to Cornerstone's August 2026 Hamilton-Burlington benchmark ($728,400), the minimum down payment is $47,840 and Ontario land transfer tax is $11,043. That is $25,000 on the first $500,000 plus $22,840 on the remaining $228,400. A 20% down payment at the same price would be $145,680.

The benchmark is a composite index value, not a typical sale price, so treat every figure here as an illustration at one price point rather than a budget.

With less than 20% down, a purchase typically needs mortgage loan insurance, which is available only on homes priced below $1.5 million, the ceiling in place since December 2024. The premium is a percentage of the mortgage based on the size of the down payment, and it can be paid as a lump sum or added to the mortgage. The minimum down payment can come from your own resources, such as savings, or from a non-repayable gift from a family member. Lender and insurer requirements vary, so how the money is documented matters.

Land transfer tax is due when the purchase closes

In Ontario, provincial land transfer tax is paid on closing. For one or two single-family residences valued over $400,000 and up to $2,000,000, the tax is 2% of the value minus $3,525. At $728,400, that is $11,043.

First-time buyers may be eligible for a refund of up to $4,000, which would bring the tax at that price to $7,043. The conditions are strict. You cannot have ever owned an eligible home, or an interest in one, anywhere in the world, at any time. You must occupy the home as your principal residence within nine months, be a Canadian citizen or permanent resident, and claim the refund at registration or within 18 months.

Closing costs come as a range

Upfront or closing costs are one-time fees paid when you buy, such as home inspection fees, legal fees, property tax adjustments and title insurance. In my experience, it is sensible to be prepared for between 1.5% and 2% of the purchase price, not counting land transfer tax. At $728,400, that is $10,926 to $14,568. Every purchase is different, and your lawyer's statement of adjustments has the final figures.

Cash needed on closing at a home priced at the August 2026 benchmark of $728,400 (illustration only)

Item Amount at $728,400 Source
Minimum down payment $47,840 Sources 1, 2
Ontario land transfer tax $11,043, or $7,043 after the maximum $4,000 first-time buyer refund, if eligible Sources 10, 11
Subtotal: down payment and land transfer tax only $58,883, or $54,883 for an eligible first-time buyer, before other closing costs Calculated from the lines above
Closing costs such as legal fees, home inspection, property tax adjustments and title insurance 1.5% to 2% of the price in Rob's experience: $10,926 to $14,568 Rob's professional experience; cost examples from Source 9

The subtotal covers only the down payment and land transfer tax. Legal fees, the inspection, adjustments, title insurance and other closing costs are still to come on top of it.

Where the money can come from, and why the paper trail matters

Beyond savings and gifts from family, two registered plans can help. The Home Buyers' Plan withdrawal limit is currently $60,000. A First Home Savings Account gives you $8,000 of room in the year you open your first one, with a $40,000 lifetime limit. Both can be used toward the same qualifying home.

Whatever the mix, the source of the funds and how it is documented is part of the file. Pulling statements together early is one of the things that separates a quick estimate from a properly built pre-approval, which I wrote about in does a mortgage pre-approval guarantee your financing.

Why I like to see this worked out first

I would rather a buyer know their real number before they start looking than find out after they have fallen for a house. Once the down payment, the land transfer tax and a closing-cost range are written down for a specific price, the cash side of the search stops being a guess.

What changes the number for a specific purchase

If you are planning a purchase this fall or next spring, I can lay out these lines for the price range you have in mind, before you book a showing. You can see how I work with buyers on my home buyers page.

A lot of my work is with first-time buyers, and it is the part of the job I enjoy most. I am happy to take the time to walk through every line with you, so you go into your search fully prepared. In my experience, that preparation makes the whole process smoother, and a lot more enjoyable.

Sources

Information reviewed as of 2026-09-22.

About the author

Rob Cagnin, AMP, CFP, is a Mortgage Broker (Licence #M08003068) with indi Mortgage (FSRA licence 12403), working with buyers and homeowners in Burlington, Hamilton, Waterdown, Oakville and throughout the Niagara region. About Rob

Rob Cagnin · Mortgage Broker · Licence #M08003068 · indi Mortgage · FSRA licence 12403

Rob Cagnin, Mortgage Broker, Licence #M08003068, indi Mortgage, FSRA licence 12403. This article is general information for Ontario readers, not advice for a specific situation. Lender and insurer requirements vary. Information reviewed as of 2026-09-22.