In a significant update, Canada has raised the Home Buyers’ Plan (HBP) withdrawal limit to $60,000 for first-time buyers. This increase from $35,000, effective from the upcoming federal budget announcement, aims to make homeownership more attainable by allowing individuals to utilize more of their RRSP savings for down payments.
Expanding the Home Buyers Plan:
The Home Buyers Plan now offers more flexibility for first-time buyers using RRSP funds for home purchases. Financial experts believe this could boost RRSP contributions, recognizing the benefits for future homeownership. This strategy aligns with financial planning goals, potentially increasing homeowners’ savings over time.
Combining Financial Strategies:
Experts also recommend maximizing contributions to the First Home Savings Account (FHSA), which offers tax advantages and complements the HBP. With the potential to accumulate substantial savings when combining the FHSA cap of $40,000 and the new HBP limit, individuals could significantly boost their initial home investment funds.
Implementation and Future Steps:
Set to be included in the 2024 federal budget, the updated HBP limit aligns with other government initiatives to assist first-time buyers, such as extending mortgage amortization periods for newly built homes. These measures collectively aim to make housing more accessible, especially amid soaring property prices and economic recovery phases.
Conclusion:
For those entering the Mississauga real estate market, these changes could dramatically enhance buying power. RE/MAX Success Realty is ready to assist new buyers with the latest financial updates. They ensure the dream of homeownership becomes achievable for more Canadians.
