City of London · Southwestern Ontario
Purchase Mortgage Guidance for London Home Buyers
London offers a wide choice between historic neighbourhoods, established family areas and newer north and northwest subdivisions. A real mortgage review lets you compare your budget against the property condition, intended use and monthly costs of the homes you are actually considering.
Choose your London neighbourhood with a mortgage plan built for the home’s condition and your real budget.
Who this is for
Buying in London
This page is for London first-time buyers, healthcare and post-secondary workers, young families, relocators and buyers interested in a home with rental or future-suite potential.
- First-time buyers seeking an entry point into London homeownership
- Healthcare, university and college employees
- Families comparing Old North or Old South with newer north-end subdivisions
- Buyers considering a house near post-secondary campuses
- Small residential investors assessing existing rental properties
Local purchase context
What actually shapes a London purchase
Local conditions change how a file is prepared, which lenders make sense, and what your closing budget needs to cover.
London has distinct housing choices on both sides of the age spectrum. Old North and Old South offer character homes, mature streets and a different maintenance profile, while north and northwest subdivisions can deliver newer layouts, garages and family-oriented streets. A purchase plan should account for the condition and likely upkeep of the actual home, not only its bedroom count. That distinction should shape your London mortgage review before you offer.
Healthcare, university and college employment give London a broad base of salaried buyers, while other households rely on variable shifts, contract work or professional income. Lenders look at the form and verification of income, the complete debt picture and the stress-tested qualifying rate. A familiar employer does not replace the normal documentation review. That distinction should shape your London mortgage review before you offer.
London can be an accessible entry market for first-time buyers and small investors, but the mortgage range must still include all carrying costs. Property tax, heat, insurance, maintenance, condo fees where relevant and closing costs can change what feels comfortable. The goal is a range that works after closing, not simply a maximum lending figure. That distinction should shape your London mortgage review before you offer.
Rental demand around post-secondary institutions leads some purchasers to consider tenants or future suites. Lenders apply their own policies to rental income, and municipal rules, property standards and the legal status of a unit should be confirmed independently. Treat projected rent as a question to be reviewed, rather than an automatic addition to qualifying income. That distinction should shape your London mortgage review before you offer.
Buyer considerations
Things London buyers should plan for
Heritage-style homes and older systems
Old North and Old South properties may need closer attention to wiring, plumbing, roofs, insulation, drainage and renovations. Inspection and insurance questions should arise early.
Newer subdivision carrying costs
A newer north or northwest home can have different tax, utility, condominium or maintenance costs than an older property. Build the complete monthly budget.
Rental and student-area assumptions
Existing or future rental income is not treated uniformly by lenders. Verify property use and unit status before you include rent in your mortgage strategy.
Ontario land transfer tax only
London buyers pay Ontario land transfer tax but no municipal land transfer tax. Eligible first-time buyers should ask their lawyer about the provincial refund.
Illustrative scenario
Illustrative London first-time buyer scenario
A hospital employee and a college instructor are looking at a $550,000 starter home. They have $40,000 saved and are deciding whether an older home near the core or a smaller northwest townhouse produces the more sustainable monthly plan.
- At a $550,000 purchase price with $40,000 down, the down payment is about 7.3 per cent. It exceeds the current minimum for this price band, and default mortgage insurance would apply because it is below 20 per cent.
- Ontario land transfer tax on a $550,000 purchase is roughly $7,475 before any first-time buyer rebate; London does not levy a separate municipal land transfer tax.
- Legal fees, title insurance, inspection, adjustments, moving and a repair reserve should be planned in addition to the down payment. Older properties can justify a larger reserve.
- Qualification uses a stress-tested rate, so lender maximums are usually lower than online estimates. Program rules can change and every file is subject to lender underwriting.
Editable example
Adjust any of these in the calculator to match your own situation.
- Example purchase price
- $550,000
- Example down payment
- $40,000 (7%)
- Federal minimum at this price
- $30,000
- Default insurance
- Would apply
- Ontario land transfer tax
- approx. $7,475
- Eligible first-time buyer rebate
- May reduce the above
Illustrative estimate only. Actual qualification depends on lender underwriting, income verification, credit, debt obligations, property details, rate and other factors. Confirm land transfer tax and rebate eligibility with your real estate lawyer.
Ontario closing costs
What you pay on top of the down payment
Ontario land transfer tax
Calculated on a sliding scale of the purchase price. On the $550,000 example above, roughly $7,475. Eligible first-time buyers may qualify for a provincial refund of up to $4,000.
No municipal land transfer tax
London buyers pay Ontario land transfer tax only. Toronto is the Ontario municipality that levies a second, municipal land transfer tax — a meaningful difference when you compare closing budgets across markets.
Legal fees, disbursements and title insurance
Your real estate lawyer handles the closing, searches title, registers the transfer and arranges title insurance. Budget for the fee plus disbursements and applicable taxes.
Inspection, appraisal and adjustments
A home inspection is your own due diligence. An appraisal may be required by the lender. Closing adjustments reimburse the seller for prepaid property taxes and utilities.
Post-closing reserve
Moving, immediate repairs, utility hookups and furnishings all land in the first weeks. A reserve keeps a surprise from becoming a problem.
Mortgage planning checklist
Before you shop in London
- 01Gather income records for salary, shift work, contract work or commission as applicable
- 02List all monthly debts before choosing a maximum purchase price
- 03Decide whether you are prioritizing character neighbourhoods, newer subdivisions or a condo
- 04Budget Ontario land transfer tax and closing costs separately from the down payment
- 05Arrange an inspection and insurance conversation for older homes
- 06Include taxes, utilities, maintenance and condo fees in your monthly budget
- 07If rental income matters, verify unit status and ask how the lender will treat it
- 08Get a meaningful qualification review before you write an offer
Local questions
London mortgage FAQs
Are Old North or Old South homes harder to finance?
Not because of their neighbourhood alone. Lenders and insurers consider the particular home, including condition, systems, renovations and appraisal. Older wiring, plumbing, roof or drainage concerns can affect the process. A good inspection and early insurance discussion help you understand the property before your financing condition expires or your repair budget is committed.
Can I use rental income from a London student-area property?
Possibly, but lender treatment depends on the actual property, unit status, lease documentation and lender policy. You should independently verify municipal rules and property standards as well. Do not assume expected rent will be fully counted just because the home is near a campus. Review it before using rental income to set your purchase budget.
How do healthcare or post-secondary employment contracts affect qualification?
The lender will review the employment type, income history and documents available to verify the income. A contract or probationary position may be assessed differently from permanent salaried employment, depending on lender policy and the full file. Bring offer letters, pay records and tax documentation to a review early, rather than relying on a broad online estimate.
How much down payment do I need for a London home?
Current federal rules require 5 per cent on the first $500,000, 10 per cent on the portion from $500,000 to $1.5 million, and 20 per cent at $1.5 million and above. Default mortgage insurance applies below 20 per cent down. Program rules can change and every mortgage file is subject to lender underwriting.
Does London have a municipal land transfer tax?
No. London buyers pay Ontario land transfer tax without an additional municipal land transfer tax. Eligible first-time buyers may qualify for a provincial refund. Your real estate lawyer should confirm the tax, refund eligibility, statement of adjustments and all final closing figures for the home you are purchasing.
Why is my lender qualification lower than a payment calculator?
Lenders typically use a stress-tested qualifying rate and review verified income, debt obligations, property taxes, condo fees where relevant and credit. A calculator may show a payment at a contract rate without all of those inputs. A meaningful review is better for setting a search range, although final lending remains subject to underwriting.
Nearby markets
Also considering markets near London?
Buyers frequently compare across neighbouring markets. Each has its own guidance page.
Next step
Get a real qualification review for your London purchase.
Tell us the facts, email your income and down-payment documents, and a mortgage professional will review your London scenario and respond within one to two business days.
A real person reviews your scenario. This platform does not issue automated approvals, and no financing outcome is guaranteed.