No. While conventional lenders typically require 20% down for non-owner-occupied residential properties with one to four units, you can put down less than 20% if you will live in one of the units. This strategy, known as house hacking, allows down payments as low as 5% using an insured mortgage, though a sliding scale applies above $500,000.
The sliding scale calculation requires 5% down on the first $500,000 of the purchase price and 10% on the remaining amount. This only applies to properties priced at $1.5 million or less where you will occupy one unit and rent the others. For example, an $800,000 property requires $55,000 down, while a $1.2 million property requires $95,000 down.
Three factors can raise your down payment. First, your personal qualification—if your income and debts mean you qualify for a smaller mortgage than planned, you must cover the gap with a larger down payment. Second, the property type matters: commercial, mixed-use, or five-plus unit properties typically require commercial financing with down payments of 25% or 30% based on net operating income. Third, deal complexity such as student rentals, short-term rentals, or using B lenders may also trigger higher minimum down payments.
Yes, but it requires creative financing strategies such as securing a private first mortgage combined with a vendor takeback from the seller, or using joint ventures and other people's money. However, these are high-leverage, high-risk strategies that are more common in commercial deals or slow markets. Beginners are strongly advised to master fundamental financing first before attempting zero-down deals.
As a rule of thumb, actual closing costs in Ontario range from 2% to 4% of the purchase price for expenses like land transfer tax and legal fees. For insured mortgages with less than 20% down, lenders want to see 1% to 1.5% of the purchase price in your account with a 90-day history. If you are putting 20% down or using commercial financing, lenders generally do not require you to prove you have closing cost funds set aside.
