Using RRSP's To Fund Down Payments...


Hi All:

The Canadian real estate market is in the midst of a busy year. For first time buyers, the biggest challenge is often how to come up with the down payment.  While it's possible to buy a home with as little as 5% down, the ideal recommendation is to put at least 20% of the purchase price toward the down payment. How can you come up with these funds?

When helping client's solidify a savings plan, financial planners often advise, "Pay yourself first." When it comes to buying a home, first time home buyers may want to consider the suggestion, "Borrow from yourself first." This can be achieved through the application of your Registered Retirement Savings Plan (RRSP) toward the down payment of a property.

Canadians who have never owned a home, or who haven't owned their primary residence for at least the past five years, may qualify to withdraw up to $25,000 (tax free) from their RRSP to put towards a home through the government's Home Buyer's Plan.  Home buyers withdrawing funds from their RRSP under this plan do not have to pay income tax on the amount withdrawn as long as the funds start being repaid into an RRSP two years after withdrawing the funds, are repaid at a minimum of 1/15 per year, and are completely repaid within 15 years.

If you would like a copy of the Home Buyer's plan, please email us at

Lastly, our inventory is low and houses are selling fast. If you, or anyone you care about is thinking of making a move, please contact us and we will be happy to discuss how to make that happen.

Until next time!

The Jamie Dann Team

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