The Home Buyers’ Plan (HBP) is a federal program that allows eligible Canadians to withdraw money from their Registered Retirement Savings Plan (RRSP) to buy or build their first home without having the withdrawal immediately treated as taxable income.

Under current rules, you can withdraw up to $60,000 from your RRSP through the HBP. You then repay the amount to your RRSP over a period of up to 15 years. But the HBP isn’t free money – you’re essentially borrowing from your own retirement savings, and there are rules about who qualifies, how much you can withdraw and how the money must be repaid.

Read What’s the point of an RRSP? to learn more about how Registered Retirement Savings Plans work.

Why Does the Home Buyers’ Plan Matter?

For many Canadians, the down payment is one of the biggest obstacles to buying a home. Even with a decent income and even substantial retirement savings, coming up with tens of thousands of dollars in cash for a down payment can still be a challenge. 

The HBP provides another option. Instead of leaving your RRSP untouched while continuing to save separately for a down payment, you may be able to use some of those retirement savings toward your home.

For example, imagine you have:

• $70,000 saved in an RRSP
• $20,000 in other savings
• $60,000 of eligible HBP withdrawal room

You could potentially use up to $60,000 of your RRSP savings through the HBP, subject to the program’s rules, giving you substantially more money to put toward your home. Since an eligible HBP withdrawal isn’t included in your taxable income, your RRSP withdrawal isn’t taxed like a regular RRSP withdrawal.

The HBP can help you access money you already have

One of the biggest advantages of the HBP is that it doesn’t require you to start saving from scratch. You’ve already contributed to your RRSP. Learn more about how RRSP contributions work before deciding whether to use those savings for a home. 

How Does the Home Buyers’ Plan Work?

The process is relatively straightforward, but the eligibility rules matter.

1. You need to qualify

The HBP is designed primarily for first-time home buyers, although the definition is broader than simply “I’ve never owned a home.” Generally, you aren’t considered a first-time home buyer if you lived in a home that you owned, or that your current spouse or common-law partner owned, during the current calendar year or the previous four calendar years. Other eligibility conditions apply, including requirements around Canadian residency and the home you’re buying.

2. You withdraw money from your RRSP

You can withdraw up to $60,000 under the HBP for a qualifying home. You can make multiple HBP withdrawals, but they typically have to be made during the calendar year of your first withdrawal and in January of the following year. You’ll also need to complete Form T1036, the Home Buyers’ Plan Request to Withdraw Funds from an RRSP.

3. You buy or build a qualifying home

The HBP isn’t intended to fund just any real estate purchase. The home must meet the program’s definition of a qualifying home and generally needs to become your principal place of residence. That means you can’t simply use the HBP to withdraw $60,000 from your RRSP to buy an investment property that you don’t intend to live in.

4. You repay the money

This is the part that is easy to overlook. The money you withdraw under the HBP has to be repaid to your RRSP, typically over 15 years. However, there’s currently some additional breathing room for recent and upcoming home buyers. For first HBP withdrawals made between January 1, 2026 and December 31, 2028, the repayment period begins in the fifth year after the year of the first withdrawal. So, if you make your first HBP withdrawal in 2026, your first repayment year will be 2031.

Home Buyers’ Plan Example

Let’s say you withdraw the full $60,000 from your RRSP in 2026. Under the current repayment rules, you won’t have to begin your required repayments until 2031.

Once your repayment period begins, you’ll generally repay the $60,000 over 15 years. That’s an average of: $60,000 ÷ 15 = $4,000 per year (or roughly $333 per month).

The actual repayment requirements and timing can vary depending on your circumstances, so it’s important to check your HBP statement and CRA information rather than relying solely on a simple calculation.

Common Misconceptions About the Home Buyers’ Plan

“The government gives me $60,000 for my down payment.”

Not quite. The HBP allows you to withdraw your own money from your RRSP. You’re not receiving a $60,000 government grant. You’re temporarily using money that was already saved for retirement.

“I never have to pay the money back.”

You do. The HBP is designed around repaying the amount you withdraw to your RRSP over the repayment period. If you don’t make the required repayment, the amount you were supposed to repay generally gets included in your taxable income for that year.

“I can use the HBP for any property.”

No. The home has to meet the HBP’s qualifying-home requirements, and you need to meet the program’s other eligibility conditions.

“I’ve never owned a home, so I automatically qualify.”

Not necessarily. The first-time home buyer definition considers whether you or your spouse or common-law partner lived in a home that you owned during the relevant period. Someone who owned a home several years ago may eventually qualify again, but someone who recently lived in a home owned by their spouse may not.

“I can’t use the HBP and FHSA together.”

You can. Eligible buyers can use a qualifying First Home Savings Account (FHSA) withdrawal and the HBP for the same home, provided they meet the conditions for each program. This can make the two programs particularly useful as part of the same home-buying strategy.

Benefits of the Home Buyers’ Plan

It can increase your available down payment

The biggest benefit is simple: you may be able to access significantly more money for your home purchase.

You don’t pay immediate tax on an eligible withdrawal

Unlike a regular RRSP withdrawal, an eligible HBP withdrawal isn’t treated as taxable income at the time of withdrawal.

It can help you buy sooner

If you’re already saving for retirement but struggling to accumulate a down payment, the HBP could help bridge the gap between “almost enough” and “enough.”

You can use it alongside an FHSA

The ability to combine an HBP withdrawal with an eligible FHSA withdrawal can make both accounts more valuable for first-time buyers.

The current repayment grace period gives buyers more time

For first withdrawals made between 2026 and 2028, repayments don’t have to begin until the fifth year following the year of the first withdrawal.

Drawbacks of the Home Buyers’ Plan

The HBP can be useful, but it isn’t automatically the right choice.

You’re taking money away from retirement savings

Money sitting in an RRSP can potentially grow for decades. When you withdraw it, that money is no longer invested in your RRSP.  Even though you’re expected to repay it, the money may miss out on investment growth while it’s being used for your home. Understanding how investing works can help you see what you’re giving up when you take money out of a retirement account.

You have to remember to repay it

Buying a home comes with plenty of new expenses: mortgage payments, property taxes, insurance, maintenance and utilities. Adding HBP repayments to the list can make your budget tighter.

Need help planning for these payments? Read What’s the Point of a Budget? for tips on creating a budget that works for you.

Missed repayments can create a tax bill

If you don’t make the required repayment, the amount you were supposed to repay may have to be reported as income. Therefore, it’s important to treat HBP repayments as a real financial obligation—not an optional savings goal.

Rules can be complicated

The HBP has specific eligibility, withdrawal, repayment and reporting requirements. For example, there are rules around RRSP contributions made shortly before an HBP withdrawal that can affect the deductibility of those contributions. When in doubt, check the current CRA rules or speak with a qualified financial professional.

Frequently Asked Questions About the Home Buyers’ Plan

How much can I withdraw under the Home Buyers’ Plan?

The current HBP limit is $60,000 per individual. If two eligible people are buying a home together, each person may potentially be able to use the HBP, provided each meets the requirements.

Do I have to repay my HBP withdrawal?

Yes. HBP withdrawals generally need to be repaid over a 15-year repayment period.

When do I start repaying an HBP withdrawal?

For first withdrawals made between January 1, 2026 and December 31, 2028, the repayment period begins in the fifth year following the year of the first withdrawal.

Can I use my FHSA and the Home Buyers’ Plan together?

Yes. You can make a qualifying FHSA withdrawal and an HBP withdrawal for the same qualifying home if you meet the requirements for both programs.

What happens if I don’t repay my HBP?

If you don’t make the required repayment for a year, the amount you were required to repay but didn’t repay is generally included in your taxable income for that year.

Can I use the HBP if I’ve owned a home before?

Possibly. The HBP’s first-time home buyer definition looks at whether you or your spouse or common-law partner lived in a home you owned during the current calendar year or previous four calendar years. Previous home ownership doesn’t necessarily mean you’re permanently excluded.

So, What’s the Point of the Home Buyers’ Plan?

The Home Buyers’ Plan is essentially a way to put some of your retirement savings to work toward buying your first home. For eligible buyers, it can provide a substantial boost to a down payment without triggering immediate income tax on the withdrawal. 

But there’s a trade-off. You’re taking money that was intended for retirement and putting it toward your home. You’ll also need to repay what you withdraw and keep track of the program’s rules. That means the HBP isn’t necessarily about asking, “How much can I take out?” A better question is: “How much can I reasonably withdraw while still keeping my long-term retirement plan on track?”

If you’re considering the Home Buyers’ Plan:

1. Check your eligibility first. Don’t assume you’re a first-time buyer simply because you’ve never personally owned a home.
2. Know the limit. $60,000 is the current maximum HBP withdrawal per individual.
3. Think beyond the down payment. Make sure you can also afford closing costs, moving expenses, mortgage payments and ongoing homeownership costs.
4. Remember that HBP money must be repaid. Build those repayments into your future budget.
5. Consider the opportunity cost. Money removed from your RRSP isn’t invested for retirement while you’re using it for your home.
6. Look at the HBP alongside an FHSA. Eligible buyers may be able to use both programs for the same home.
7. Understand the rules before withdrawing. A mistake can turn an intended HBP withdrawal into a taxable RRSP withdrawal.
8. Check your CRA account and HBP statement. Keep track of your outstanding balance and required repayments.

The Home Buyers’ Plan can be a useful tool—but like most financial tools, its value depends on how you use it. Your financial advisor can help you decide if the HBP is right for you.