Blog > After the First-Time Home Buyer Incentive: Using the FHSA and HBP to Maximize Markham Purchase Power
After the First-Time Home Buyer Incentive: Using the FHSA and HBP to Maximize Markham Purchase Power
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How can first time buyers use the FHSA and Home Buyers Plan to buy in Markham
The federal First-Time Home Buyer Incentive was discontinued in March 2024, so today’s first-time buyers rely on registered accounts instead. The First Home Savings Account (FHSA) allows $8,000 a year, up to $40,000, with tax-deductible contributions and tax-free withdrawals for a first home. The Home Buyers’ Plan (HBP) lets you withdraw up to $60,000 from your RRSP, repaid over 15 years. You can use both for the same purchase, so a couple could access up to $200,000 plus growth. Ontario also refunds up to $4,000 of land transfer tax for eligible first-time buyers.
What Happened to the First-Time Home Buyer Incentive
The First-Time Home Buyer Incentive was a shared-equity program in which the federal government contributed part of the down payment in exchange for a share of the home’s value. It was discontinued in March 2024 and no longer accepts new applications. Buyers who already used it still repay the incentive under their agreement, usually when they sell or after 25 years.
Michael John Lau, a REALTOR® with the Kaizen Real Estate Team, one of the most active real estate teams in Markham and York Region, now walks first-time buyers through the two tools that replaced it in practice: the FHSA and the HBP.
How the FHSA Works
| Feature | FHSA |
|---|---|
| Annual contribution limit | $8,000 |
| Lifetime limit | $40,000 |
| Unused room | Up to $8,000 can carry forward to the next year |
| Contributions | Tax-deductible, like an RRSP |
| Qualifying withdrawal | Tax-free, like a TFSA |
| How long it can stay open | Up to 15 years, or until the end of the year you turn 71 |
| If you do not buy | Funds can generally be moved to an RRSP without using RRSP room |
Room only starts when you open the account, so opening an FHSA early, even with a small deposit, starts the clock on your contribution room.
An FHSA can hold savings, GICs or investments. If you plan to buy within a year or two, many buyers keep the money in lower-risk options so the down payment is there when they need it. A longer timeline may allow for more growth, along with more ups and downs.
How the Home Buyers’ Plan Works
The HBP lets first-time buyers withdraw up to $60,000 from their RRSPs to buy or build a qualifying home, up from $35,000 before April 16, 2024. The withdrawal is not taxed, but it must be repaid to your RRSP over up to 15 years, starting in the second year after the withdrawal. Missed repayments are added to your taxable income for that year.
For withdrawals made from 2022 to 2025, the government extended the start of repayments to five years. Check the current rules for your withdrawal year with your financial advisor.
One timing rule catches many people: RRSP contributions made within 90 days before an HBP withdrawal may not be deductible. Plan contributions well ahead.
Planning your first purchase in Markham? Call Michael John Lau, REALTOR®, at (416) 700-0286 to map your savings plan to the homes you want.
Combining the FHSA and the HBP
You can use an FHSA withdrawal and an HBP withdrawal for the same home. Here is how that can add up for a couple who are both first-time buyers:
| Source | Per person | Couple |
|---|---|---|
| FHSA (maximum contributions) | $40,000 | $80,000 |
| HBP from RRSPs | $60,000 | $120,000 |
| Total before investment growth | $100,000 | $200,000 |
FHSA money does not need to be repaid. HBP money does. Many buyers use the FHSA first and the HBP for the remainder.
Other Programs Markham First-Time Buyers Can Use
- Ontario land transfer tax refund: up to $4,000 for eligible first-time buyers. Markham does not charge a municipal land transfer tax.
- First-Time Home Buyers’ Tax Credit: a $10,000 federal credit, worth up to $1,500 in tax savings.
- 30-year amortization: first-time buyers with an insured mortgage can choose a 30-year amortization, which lowers the monthly payment.
- GST and HST rebates on new homes: eligible first-time buyers of new homes may qualify for rebates. See how much HST a Markham first-time buyer can save.
A Two-Year Down Payment Plan
- This year: open an FHSA and contribute up to $8,000. Ask your accountant whether to claim the deduction now or later.
- Next year: contribute another $8,000, plus any carried-forward room.
- Keep RRSP savings in place for at least 90 days before any HBP withdrawal.
- Use tax refunds from FHSA and RRSP contributions to add to savings.
- Get pre-approved about three to four months before you plan to buy, so you know your price range.
- Budget for closing costs, including land transfer tax after the refund, legal fees and moving.
For a look at what different budgets buy, see what a first-time buyer can afford in Markham.
Who Counts as a First-Time Buyer
Each program has its own definition. For the FHSA and the HBP, a first-time buyer generally means you, and for the FHSA your spouse or common-law partner, did not live in a home you owned in the current year or the previous four years. Ontario’s land transfer tax refund has its own rules. Confirm your eligibility for each program before you plan around it.
Ultimately, the decision is yours. The goal is to make sure you have all the information to plan your first purchase.
Next Steps
- First-time home buyer services: how Michael guides first-time buyers.
- Mortgage calculator: test payments at different prices.
- What a first-time buyer can afford: Markham homes by budget.
Frequently Asked Questions
Is the First-Time Home Buyer Incentive still available?
No. The federal First-Time Home Buyer Incentive was discontinued in March 2024 and no longer accepts new applications.
How much can I put in an FHSA?
You can contribute up to $8,000 a year, with a $40,000 lifetime limit. Up to $8,000 of unused room can carry forward to the next year.
How much can I withdraw under the Home Buyers’ Plan?
Up to $60,000 per person from your RRSP, for withdrawals after April 16, 2024. The amount must be repaid to your RRSP over up to 15 years.
Can I use the FHSA and HBP together?
Yes. You can use both for the same qualifying home purchase. A couple who are both first-time buyers could access up to $200,000 before investment growth.
What is the Ontario land transfer tax refund for first-time buyers?
Eligible first-time buyers can receive a refund of up to $4,000 of Ontario land transfer tax. Markham does not charge a separate municipal land transfer tax.
Who qualifies as a first-time buyer for the FHSA?
Generally, you and your spouse or common-law partner did not live in a home you owned in the current year or the previous four calendar years. Confirm the rules before opening an account.
Work With Michael John Lau in Markham
Michael John Lau helps first-time buyers in Markham turn a savings plan into a clear home search, from budget and neighbourhoods to offers and closing. He works alongside your mortgage professional and financial advisor so every program is used to its full benefit. The goal is a first home you feel confident about.
📞 Contact Michael John Lau, REALTOR®
🌐 www.callmikelau.com
Ready to plan your first home?
Michael John Lau can help you set a realistic budget and timeline for buying in Markham.
Michael John Lau, REALTOR® · Markham, Ontario · (416) 700-0286
Disclaimer. Michael John Lau is a licensed REALTOR® serving buyers and sellers in Markham, Ontario and the Greater Toronto Area. Program details reflect federal and Ontario rules as of October 7, 2026, including the Home Buyers’ Plan limit announced in Budget 2024 (Advisor.ca, April 11, 2024). Examples are for illustration only. Program rules change, so confirm with the CRA, the Government of Ontario or your advisor. Michael John Lau is not a lawyer, accountant, tax advisor or mortgage professional. This article is general information, not legal, tax or financial advice. Speak with a qualified professional about your own situation.