Low Down Payment Buyers: Why Strategy Matters More Than Ever

In today’s market, affordability is still a challenge and with interest rates holding firm, many buyers are entering the real estate game with smaller down payments. Whether it’s limited savings or financial help from family, the reality is: a low down payment isn’t a dealbreaker. But it does mean that strategy becomes the star of the show.

Here’s what you should know when it comes to making low down payment purchases work in 2025:

Minimum Down Payment Rules (2025)

• For homes under $500,000 the minimum required is 5%

• For homes between $500,000 and $999,999

• 5% on the first $500,000

• 10% on the portion above that

Example:

A $700,000 home would require

$25,000 (5% of $500,000) + $20,000 (10% of $200,000) = $45,000 total

That works out to roughly 6.4% down

Gifted Down Payments Are Welcome

If you’re getting help from family, that’s totally fine. Lenders allow gifted funds from immediate family members, as long as

• The gift is non-repayable

• A signed gift letter is provided

• The funds are in your account before closing

This can be a game-changer if you’re close but not quite there on your own.

Other Options to Explore

You might also qualify to borrow your down payment using a line of credit or personal loan, depending on your debt servicing ratios. And if you’re a first-time buyer, you can use up to $60,000 from your RRSPs under the Home Buyer’s Plan tax-free.

This Approach Works Best If You

• Are a first-time buyer with limited savings

• Are getting financial help from family

• Aren’t sure what options you qualify for

• Are feeling unsure but want to explore your next step

If you’re not sure how close you are to being ready or if you want help figuring out what’s possible, I’m happy to walk you through it. With the right plan in place, a smaller down payment doesn’t have to hold you back.