Federal Down Payment Programs
First Home Savings Account (FHSA)
Canada's most powerful down payment savings tool. Combine RRSP-like tax deductions with TFSA-like tax-free withdrawals for qualifying home purchases.
- Contribute up to $8,000/year ($40,000 lifetime limit)
- Contributions are fully tax-deductible — reduces your annual tax bill immediately
- Qualifying withdrawals for a first home are completely tax-free
- Investment growth inside the account is sheltered from tax
- Open as soon as you start thinking about buying — even 1-2 years of FHSA savings is significant
RRSP Home Buyers' Plan (HBP)
Withdraw up to $60,000 from your RRSP ($120,000 per couple) tax-free to fund your first home purchase. Repay over 15 years.
- Maximum individual withdrawal increased to $60,000 in 2024 (was $35,000)
- No immediate tax impact — effectively an interest-free loan from your own retirement savings
- Best if you have significant RRSP savings already accumulated
- Can be combined with FHSA withdrawals for a larger combined down payment
Provincial Down Payment Assistance Programs
Ontario — Various Programs
- Ontario First Time Home Buyer Incentive: Check Ontario's current programs as the federal/provincial shared equity programs evolved significantly post-2023
- Land Transfer Tax Rebate: Up to $4,000 rebate on Ontario LTT; up to $4,475 additional on Toronto LTT — these savings effectively increase your usable down payment
- City of Toronto programs: Various initiatives for affordable housing and co-op housing
British Columbia
- BC First Home Buyers Tax Credit: Up to $840 in provincial tax savings
- Property Transfer Tax Exemption: Full PTT exemption for first-time buyers on homes under $835,000; partial for homes $835,001-$860,000
- BC Home Owner Grant: Annual property tax reduction for qualifying homeowners — not direct down payment help but reduces carrying costs
- Affordable Home Ownership Program (AHOP): Municipal programs in some BC cities offering shared equity loans to qualifying buyers
Alberta
- Alberta has no provincial land transfer tax — a significant advantage over BC, Ontario, and other provinces
- Attainable Homes Calgary: Down payment assistance for eligible Calgary residents
- Edmonton programs: Various municipal programs for affordable homeownership
- Absence of LTT saves buyers approximately $100-$25,000 on a typical home purchase compared to Ontario buyers
Quebec
- HBP (federal): Available to all Canadian residents including Quebec
- AccèsLogis: Social housing program providing subsidized housing units
- Prêt Abordable Quebec: Interest-free loan program for eligible first-time buyers (income-tested)
- Montreal has various incentive programs for first-time buyers in specific neighborhoods
Nova Scotia, New Brunswick, PEI, Newfoundland
- Atlantic provinces generally offer lower home prices than major Ontario and BC markets, making down payment accumulation more achievable
- Nova Scotia Affordable Housing Commission: Various programs supporting first-time buyers
- New Brunswick Housing: Programs for low-to-moderate income homebuyers
- Federal programs (FHSA, HBP, HBTC) available to all Atlantic residents
Shared Equity Programs in Canada
Shared equity programs allow a government entity or nonprofit to contribute to your down payment in exchange for a proportional share of any future appreciation (or depreciation) in your home's value.
Federal Shared Equity Programs — 2025 Status
The federal First-Time Home Buyer Incentive (FTHBI), which provided 5-10% shared equity contributions, was discontinued in 2024. Check the Canada Mortgage and Housing Corporation website for any replacement programs announced for 2025-2026.
Municipal Shared Equity Programs
Several Canadian municipalities operate local shared equity programs:
- Attainable Homes Calgary: Provides down payment loans; buyer repays when selling
- Vancouver/Metro Vancouver: Various community land trust programs offering affordable homeownership
- Brentwood/Surrey/Burnaby: Affordable housing initiatives in development
Strategies to Maximize Your Down Payment
| Strategy | Potential Impact | Timeline |
|---|---|---|
| Open FHSA immediately & max out | $8,000/year + tax refund (~$2,400/year at 30% rate) | Annual; start now |
| Maximize RRSP for HBP (if not yet done) | Up to $60,000 per person tax-free | Build over years |
| KOHO high-interest savings | Earn competitive interest on down payment savings | Start immediately |
| Claim HBTC at purchase | $1,500 federal tax credit | Year of purchase |
| Ontario LTT rebate (if applicable) | Up to $8,475 | Year of purchase |
| GST rebate on new build | Up to $6,300 federal + provincial | New build only |
Non-Traditional Down Payment Sources
Lenders in Canada accept various sources for your down payment, provided they are documented:
- Gifted funds: Down payments can be gifted by immediate family. A "gift letter" stating no repayment is required must be provided. Some lenders limit the gifted portion for uninsured mortgages.
- RRSP/FHSA withdrawals: Both are acceptable documented down payment sources
- Savings accounts: 90-day history of funds typically required (showing the money didn't appear suddenly)
- Sale of assets: Cars, investments, cryptocurrency — documentation of the sale required
- Inheritance/estate proceeds: Documented with legal paperwork
Note: Borrowed down payments are generally not acceptable for insured mortgages (under 20% down). For conventional mortgages, some lenders have different policies — speak with a mortgage broker about your specific situation.
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