First Time Home Buyer
in London.

London occupies a rare sweet spot for first-time buyers – large enough for urban amenities, affordable enough that single earners and young couples can realistically enter the market.

Condos average approximately $315,000 and townhomes around $485,000. Compare that to Toronto, where the average exceeds $1 million and even condos approach $700,000. A first-time buyer who qualifies for $400,000 in Toronto gets a small studio; the same budget in London opens the door to a two-bedroom condo or a townhome in a family-friendly area.

London's economy adds appeal. The city's largest employers – London Health Sciences Centre, Western University, and Fanshawe College – anchor a growing professional class, supplemented by an expanding tech sector and strong manufacturing base. The current buyer-friendly market, with elevated inventory and room to negotiate, gives first-time purchasers advantages that were unavailable just two years ago.

Canada's down payment rules are tiered based on purchase price. On the first $500,000, the minimum is 5 percent. On the portion between $500,000 and $999,999, the minimum jumps to 10 percent. Homes priced at $1 million or above require a minimum 20 percent down. Since most first-time purchases in London fall below $500,000 for condos and townhomes, the 5 percent minimum applies to the vast majority of entry-level buyers.

When your down payment is less than 20 percent, you must purchase mortgage default insurance – commonly called CMHC insurance – which protects the lender in case of default. The premium is a percentage of the mortgage amount that decreases as your down payment increases. At 5 percent down, the premium is 4.00 percent of the mortgage. At 10 percent down, it drops to 3.10 percent. At 15 percent, it is 2.80 percent. The premium is added to your mortgage balance and amortized over the life of the loan, so you do not pay it out of pocket at closing.

Building your down payment requires discipline, but London's comparatively affordable entry points make it more achievable than in larger cities. A buyer saving $1,000 per month reaches the $15,750 minimum for a London condo in roughly 16 months. Combining savings with RRSP withdrawals under the Home Buyers' Plan, gifts from family, and contributions to a First Home Savings Account can accelerate the timeline significantly.

First-time buyers in Ontario have access to several government programs designed to make homeownership more accessible. Stacking multiple programs together can significantly reduce the upfront cost of purchasing your first London home.

Mortgage pre-approval should be your first step – before touring a single property. Pre-approval establishes how much you can borrow, what rate you qualify for, and that a lender has reviewed your finances.

You provide your broker with proof of income, bank statements, identification, and a debt summary. The broker submits to a lender, who pulls your credit, runs the stress test, and issues a pre-approval letter valid for 90 to 120 days with a held rate. For first-time buyers, the pre-approval conversation is also educational – you learn how the stress test works, what payments look like at different price points, and how programs like the HBP and FHSA fit your plan.

London's geography offers distinct neighbourhood clusters, each with its own character, price range, and appeal for first-time buyers. Understanding the landscape helps you focus your search on areas that match both your budget and your lifestyle.

Your down payment is not the only cash you need at closing. First-time buyers in London should budget for closing costs of approximately 1.5 to 4 percent of the purchase price, covering legal fees, title insurance, home inspection, appraisal, and land transfer tax after any applicable rebate.

For a London condo purchase at $315,000, total closing costs after the FTHB land transfer tax rebate might be as low as $2,500 to $4,000. For a detached home at $625,000, expect $5,000 to $10,000 depending on the specific costs involved. Your broker and real estate lawyer provide detailed estimates before you commit to a purchase so there are no surprises on closing day.

London's position outside the City of Toronto is a tangible financial advantage at closing. Toronto buyers pay both provincial and municipal land transfer tax, effectively doubling this cost. A London buyer purchasing at $625,000 saves over $8,000 compared to an equivalent purchase inside Toronto – money that stays in your pocket or goes toward furnishing your new home. Ready to start? Contact Canadian Mortgage Services for a free pre-approval and find out exactly what London has to offer within your budget.