One of the first questions I hear from buyers is this one: "How much money do I need to have saved before I can even think about buying?" Some people believe they need 20% of the price — on a $540,000 home, that's $108,000, and it scares them away. The truth is simpler than that. Canada has a clear rule, and once you see it, the math takes about thirty seconds.
The rule is a simple ladder.
Think of the home price as climbing three steps:
- Step 1 — the first $500,000: you need 5%. That's $25,000.
- Step 2 — from $500,000 up to $1.5 million: you need 10% on that part. So on a $600,000 home, the extra $100,000 needs $10,000.
- Step 3 — $1.5 million and up: you need 20%.
That's it. The minimum down payment on most homes in London is far less than 20%.
A real London example.
In September 2026, the median home in London — the one in the middle, not the cheapest and not the priciest — sold for $540,000. The minimum down payment on that home: 5% of the first $500,000 ($25,000) plus 10% of the remaining $40,000 ($4,000) — $29,000 total. That's the legal minimum. Of course, putting down more lowers your monthly payment, so it's always worth discussing what fits your situation.
What if I put down less than 20%?
Then you pay for something called mortgage insurance (usually through CMHC). Here's the simple version: it's insurance that protects the lender, not you — you pay for it because the lender is taking more risk with a smaller down payment. It's normally added to your mortgage, so you don't write a separate check. At 20% or more, you skip it.
One more thing that helps first-time buyers.
Since December 2024, first-time buyers can spread an insured mortgage over 30 years instead of 25. Think of it like this: the same loan paid over more years means a smaller monthly payment. You pay more interest over time, but the lower payment is often what makes buying possible in the first place.
And remember the second check.
The down payment is the biggest amount you'll pay upfront — but it's not the only one. Plan for closing costs too: land transfer tax, lawyer fees and a few other items, usually around 1.5% to 4% of the price. Knowing both numbers up front means no surprises.
If you're wondering where you stand, talk to us first. We'll run your real numbers with you — in plain words, no pressure.
— Paola Cano & Jose Ramirez, Thrive Realty Group Inc., Brokerage, London, Ontario.
Data from: CMHC minimum down-payment rules (5% / 10% tiers, $1.5M insured cap since Dec 15, 2024; 30-year amortization for first-time buyers); London September 2026 median sale price $540,000 (MLS® data via liveinoakridge.ca); closing-cost guidance 1.5%–4% (CMHC).