Ontario’s New First-Time Home Buyer RSP Program: A Game-Changer for Aspiring Homeowners

Buying | 04-7-23

Purchasing a home is one of the most significant investments a person can make. However, saving up enough money for a down payment can be a challenge for first-time homebuyers, especially with rising housing prices. Luckily, Ontario’s new First-Time Home Buyer RSP program aims to make home ownership more accessible for Ontarians.

How does it work?

The First-Time Home Buyer RSP program allows eligible first-time homebuyers in Ontario to withdraw up to $35,000 from their Registered Retirement Savings Plan (RRSP) tax-free to put towards a down payment on a home. This program essentially allows first-time homebuyers to use their own savings to help fund their home purchase.

To be eligible for the program, applicants must meet the following criteria:

  • Be a resident of Ontario
  • Be a first-time homebuyer or have not owned a home in the last four years
  • Have a valid agreement of purchase and sale
  • Have a written agreement to buy or build a qualifying home
  • Intend to occupy the home as their principal residence within one year of purchase or construction.

The funds must be in the applicant’s RRSP for at least 90 days before withdrawal and must be repaid within 15 years to avoid being subject to income tax. Repayments can be made in installments or as a lump sum, providing flexibility for the homeowner.

What are the benefits for first-time homebuyers in Ontario?

The First-Time Home Buyer RSP program provides several benefits for first-time homebuyers in Ontario:

Access to Tax-Free Savings

By accessing their RRSPs, first-time homebuyers can utilize their own savings without incurring tax penalties. This program allows homebuyers to use their retirement savings to help fund their first home purchase, providing a unique opportunity to build equity in their property.

Increased Affordability

With the rising cost of housing, the First-Time Home Buyer RSP program makes home ownership more accessible for first-time homebuyers in Ontario. The program allows eligible applicants to withdraw up to $35,000 from their RRSP, which can be a significant portion of a down payment.


The program provides flexibility for homeowners in repaying the withdrawn funds. Homeowners have up to 15 years to repay the amount without incurring tax penalties, giving them ample time to manage their finances.

Savings on Mortgage Insurance

By utilizing the program, homeowners can put down a larger down payment, which may save them on mortgage insurance premiums. This can result in significant savings over the life of the mortgage.

Ontario’s First-Time Home Buyer RSP program is a game-changer for aspiring homeowners in the province. It provides tax-free access to retirement savings, increased affordability, flexibility in repayment, and savings on mortgage insurance. With these benefits, the program is an excellent opportunity for first-time homebuyers to achieve their dream of homeownership.