First-Time Buyer Guide · Updated 2026
FHSA + Home Buyers’ Plan in Newfoundland
Two federal programs are built specifically to help you save for a first home — the First Home Savings Account (FHSA) and the RRSP Home Buyers’ Plan (HBP). You can use both together. Here’s how each one works and how to stack them for a purchase in NL.
The Two Programs
Both are federal programs, available to qualifying first-time buyers anywhere in Canada — including throughout Newfoundland and Labrador. They work in different ways, and most first-time buyers benefit from using both.
First Home Savings Account (FHSA)
The FHSA launched in 2023. It’s designed to give first-time buyers the best of both an RRSP and a TFSA in one account:
- Contribution room: up to $8,000 per year, with a $40,000 lifetime cap.
- Tax-deductible going in — like an RRSP, contributions reduce your taxable income for the year.
- Tax-free coming out — like a TFSA, qualifying withdrawals for a first home (including any investment growth) are tax-free.
- No repayment — unlike the HBP, you don’t pay an FHSA withdrawal back.
- Unused room carries forward — if you don’t contribute the full $8,000 in a year, the remainder can carry forward (subject to CRA rules).
RRSP Home Buyers’ Plan (HBP)
The HBP lets you borrow from your own RRSP to fund a first-home down payment:
- Withdraw up to $60,000 from your RRSP tax-free for a qualifying first home (raised from $35,000 in 2024).
- You repay it — the withdrawal goes back into your RRSP over 15 years.
- Miss a repayment and it’s taxed — any required annual repayment you don’t make is added to your taxable income for that year.
- The money has to be in the RRSP first — and generally needs to have been there for at least 90 days before you withdraw it.
Can I Use Both Together?
Yes. The two programs are not mutually exclusive — many first-time buyers draw on both to build the largest possible down payment. As a general rule of thumb:
- The FHSA is often the better starting point for newer savers — you get the upfront tax deduction, the growth is tax-free, and there’s nothing to repay.
- The HBP can be the bigger lever if you already have a meaningful RRSP balance built up — it lets you tap up to $60,000 you’ve already accumulated.
- Stacking both can put a substantial combined sum toward your down payment — but the right mix depends on your income, your existing savings, and your timeline.
Which combination is best for you is a financial-planning question, not a real-estate one. A financial advisor or your bank can model your specific numbers, and the CRA sets the official rules. Confirm contribution room, eligibility, and withdrawal timing before you commit.
FHSA vs HBP at a Glance
| FHSA | Home Buyers’ Plan (HBP) | |
|---|---|---|
| Contribution / withdrawal limit | $8,000/yr, $40,000 lifetime cap | Withdraw up to $60,000 from your RRSP |
| Tax treatment | Deductible going in; qualifying withdrawals tax-free | Withdrawal is tax-free upfront, but must be repaid |
| Repayment | None | Repaid to RRSP over 15 years; missed repayments added to taxable income |
| Best for | Newer savers building from scratch | Buyers with an existing RRSP balance to draw on |
Program figures are the documented federal limits. Rules and limits can change — always confirm current details with a financial advisor or directly with the Canada Revenue Agency before relying on them.
How This Works for an NL Purchase
Both the FHSA and the HBP are federal programs, so they apply to a qualifying first home anywhere in Newfoundland and Labrador — whether you’re buying in Gander, on the Gander Loop, in Lewisporte, or anywhere else we serve in Central NL.
Funding the down payment is only one piece of the budget. On top of it you’ll also need closing costs — and here NL buyers catch a break, because the province has no land-transfer tax. See our Newfoundland closing-costs guide for that breakdown.
And if you’re buying or building new construction, there are additional federal HST rebates to factor in — our HST rebate guide walks through those. The FHSA and HBP cover your savings side; those guides cover the cost side.
Common Questions
Can I really use the FHSA and the Home Buyers’ Plan at the same time?
Yes — the two programs can both be applied to the same qualifying first-home purchase. The FHSA gives you a tax-deductible, no-repayment savings vehicle; the HBP lets you tap your existing RRSP. Whether stacking both is right for you depends on your numbers, so confirm with a financial advisor.
What counts as a “first-time buyer” for these programs?
The CRA has specific definitions for each program, generally based on not having owned a home you lived in as your principal residence within a defined recent period. The exact rules differ between the FHSA and the HBP. Check the current CRA criteria for your situation before assuming you qualify.
Do I have to pay the FHSA money back like the HBP?
No. Qualifying FHSA withdrawals for a first home don’t have to be repaid and are tax-free. The HBP is different — it’s a withdrawal from your RRSP that you repay over 15 years, and any required repayment you miss is added to your taxable income for that year.
How much can I put toward a down payment using both?
The FHSA caps at $40,000 in lifetime contributions (plus any growth), and the HBP lets you withdraw up to $60,000 from an RRSP. How much you can actually deploy depends on how much you’ve saved and your eligibility under each program. A financial advisor can model your real numbers.
If I put money in an RRSP now, can I withdraw it for the HBP right away?
Generally the funds need to have been in the RRSP for a minimum period (commonly 90 days) before an HBP withdrawal. Timing matters if you’re close to a purchase. Confirm the current rule with your financial institution or the CRA before counting on a recent contribution.
Where do I open these accounts?
FHSAs and RRSPs are offered through banks, credit unions, and investment firms. They’re a personal-finance product, not a real-estate one — so talk to your bank or a financial advisor about opening and funding them. We can help you find and finance the home itself.
Ready to Start Looking in Central Newfoundland?
Once your down-payment plan is taking shape, a Turner Realty agent can help you figure out what that means in terms of the homes you can actually buy — and connect you with a mortgage broker and financial advisor for the savings and financing side, which we don’t advise on directly.
This guide is for general information only. It is not financial, tax, or legal advice. The FHSA and Home Buyers’ Plan are federal programs with detailed eligibility rules and contribution limits that can change. Always confirm current limits, eligibility, withdrawal timing, and repayment requirements with a qualified financial advisor or directly with the Canada Revenue Agency before relying on them. Royal LePage Turner Realty does not provide financial or tax advice.