For many first-time buyers, the biggest obstacle isn’t finding a home, it’s building the down payment. The good news is that eligible buyers may be able to combine the First Home Savings Account (FHSA) with the Home Buyers’ Plan (HBP) to create a stronger, more tax-efficient homebuying plan.

FHSA contributions can be tax-deductible. Eligible first-time buyers can contribute up to $8,000 per year, with a lifetime contribution limit of $40,000. Qualifying withdrawals for a first home are tax-free.

The HBP allows RRSP withdrawals. You can currently withdraw up to $60,000 from your RRSP to buy or build a qualifying home, according to the Canada Revenue Agency.

Here’s the key: you may use both programs for the same home. A qualifying buyer can make an FHSA withdrawal and an HBP withdrawal for the same property, provided all program conditions are met.

The HBP repayment timeline has changed for new withdrawals. If your first HBP withdrawal happens between January 1, 2026, and December 31, 2028, the 15-year repayment period begins in the fifth year after the withdrawal year. For example, a first withdrawal in 2026 would have a first repayment year of 2031.

Plan your cash flow before withdrawing. HBP withdrawals must eventually be repaid to your RRSP. If you do not repay the required amount, the unpaid portion is generally added to your taxable income for that year.

Remember closing costs. Your down payment is only one part of the cash you need. Budget for legal fees, inspections, adjustments, moving costs, property taxes, and possible mortgage default insurance.

Do not stretch your approval to the limit. CMHC’s latest mortgage report says average mortgage payments increased to $1,883, while mortgage arrears remain low nationally but are rising unevenly across some regions. A payment that works on paper still needs to leave room for groceries, transportation, repairs, and real life.

What This Means for Buyers and Immigrants

If you are building your first down payment in Canada, the FHSA and HBP can potentially help you combine savings from different stages of your financial journey. For newcomers and immigrant families, this is also a reminder that a strong mortgage plan includes credit history, stable income, documented savings, and a realistic monthly budget, not just a pre-approval number.

The goal is not simply to buy a home. The goal is to buy in a way that protects your peace. Dahan-dahan, but with a plan.

A Simple Next Step

Check whether you qualify as a first-time homebuyer. Review your FHSA contribution room. Confirm how much you may be eligible to withdraw through the HBP. Estimate your full monthly ownership cost. Speak with qualified tax and mortgage professionals before making a withdrawal or purchase decision.

For Buyers: Book your Buyer Consultation at https://calendly.com/sellwithariell/buyer-consult

Or call/text 587-510-2008 or email ariell@sellwithariell.com

Stay informed, plan ahead, and remember, financial freedom is not just owning a home, it’s being able to enjoy the life inside it.

Sources: Bank of Canada at https://www.bankofcanada.ca, Canada Revenue Agency Home Buyers’ Plan at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/rrsps-related-plans/what-home-buyers-plan.html, CMHC Residential Mortgage Industry Report at https://www.cmhc-schl.gc.ca/professionals/housing-markets-data-and-research/housing-research/research-reports/housing-finance/residential-mortgage-industry-report, CMHC Buying a Home at https://www.cmhc-schl.gc.ca/consumers/home-buying, and Financial Consumer Agency of Canada at https://www.canada.ca/en/financial-consumer-agency.html.