FHSA or RRSP Home Buyers' Plan?

The First Home Savings Account gives qualifying first-time buyers the best of both registered worlds: contributions are deductible like an RRSP, and withdrawals for a qualifying first home are tax-free like a TFSA — with no repayment, ever. Room accrues at $8,000 per year once opened, to a $40,000 lifetime limit.

The Home Buyers' Plan takes a different route: withdraw up to $60,000 from your existing RRSP for a first home, tax-free at the time, repaid to your RRSP over 15 years — with missed repayments added to your income.

Dollar for dollar, the FHSA dominates: the same deduction as an RRSP contribution, but the withdrawal is permanently tax-free and nothing must be repaid. Its constraints are capacity and clock — $8,000 of new room per year (plus at most one year's carryforward), $40,000 lifetime, and a maximum participation window of 15 years — so opening the account early starts room accruing even before serious saving begins.

The HBP's role is unlocking savings that already sit in your RRSP, and its scale ($60,000 per person) matters for expensive markets. Its cost is subtle: repayments consume future contribution room's cash without generating new deductions, and the withdrawn funds miss years of sheltered growth. The two programs stack — a couple could combine $80,000 of FHSA room with $120,000 of HBP capacity — and if a home never materializes, FHSA funds roll tax-deferred into an RRSP with no penalty.