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9 Sep

How Much Do You Need for a Down Payment in BC?

General

Posted by: Gavin Toor

If you’re planning to buy a home in British Columbia, one of the first questions you’ll ask is:

👉 How much do I need for a down payment?

The rules for minimum down payments in Canada recently changed, and it’s important to know exactly where you stand. Whether you’re a first-time homebuyer in BC, upgrading, or investing, here’s everything you need to know.

Minimum Down Payment Rules in Canada

As of December 2024, the maximum home price eligible for an insured mortgage increased from $1 million to $1.5 million. This means you can buy a home under $1.5M with less than 20% down (if you qualify).

Here’s how it breaks down:

  • Homes up to $500,000 → 5% down

  • $500,001 – $1,499,999 → 5% on the first $500,000 + 10% on the rest

  • $1.5M or more → 20% minimum down payment (insurance not available)

💡 Example: Buying a $1,200,000 home in Surrey:

  • 5% of $500,000 = $25,000

  • 10% of the remaining $700,000 = $70,000

  • ✅ Total down payment = $95,000 (~7.9%)

Insured vs. Uninsured Mortgages

If you’re putting less than 20% down, your mortgage must be insured by CMHC, Sagen, or Canada Guaranty. This protects the lender and allows you to buy with a smaller down payment.

👉 Want a deeper dive? Check out my blog: What is a CMHC-Insured Mortgage in Canada?

With 20% or more down, your mortgage is considered uninsured, meaning no insurance premium—but you’ll need more cash upfront.

💡 New rule: First-time buyers and buyers of newly built homes can stretch amortizations to 30 years on insured mortgages, making monthly payments more affordable.

Don’t Forget Closing Costs in BC

On top of your down payment, you’ll need money for closing costs, which usually add up to 1.5%–2% of the purchase price.

Key BC costs include:

  • Property Transfer Tax (PTT):

    • First-Time Home Buyer Program: Full/partial exemptions up to $835,000 (phased out at $860,000).

    • Newly Built Home Exemption: Full exemption up to $1.1M (phased out at $1.15M).

  • Legal fees and disbursements

  • Title insurance

  • Appraisal or inspection fees

  • Moving costs

Programs to Help You Save for Your Down Payment

  • Home Buyers’ Plan (HBP): Withdraw up to $60,000 from your RRSPs ($120,000 as a couple) tax-free.

  • First Home Savings Account (FHSA): Contribute up to $8,000 per year (max $40,000) with tax benefits, then use it toward your first home.

Why Planning Ahead Matters

Your down payment is just one part of the picture. Lenders also look at:

  • Your income and employment history

  • Your debts and credit score

  • The property type (condo, house, presale, investment)

Working with a mortgage broker in BC gives you access to:

  • Multiple lenders (banks, credit unions, monolines, alternative)

  • Rate holds to protect you while you shop

  • Flexibility to revisit your rate if the market changes before completion

Final Thoughts

Buying in BC is competitive, but knowing how much you really need for a down payment gives you confidence and clarity.

If you’re planning to buy in the next 6–12 months, now is the time to prepare. I’ll help you map out your down payment, closing costs, and lender options so there are no surprises on closing day.

📞 Gavin Toor – Mortgage Broker (Volterra Capital Corp.)
📲 604-835-4999 | ✉️ gavintoormortgages@gmail.com
🌐 gavintoormortgages.com