Changes in the Home Buyers' Plan (HBP) in Canada | Bloom Accounting

Today, we’re diving into the recent changes to the Home Buyers' Plan, or HBP, in Canada. What’s new, how do these changes benefit you, and what do you need to know to take advantage of them? Let’s get started!

What is the Home Buyers' Plan (HBP)

First, a quick refresher. The Home Buyers' Plan allows firsttime homebuyers to withdraw funds from their Registered Retirement Savings Plans, or RRSPs, to buy or build a qualifying home. The great part? These withdrawals are taxfree as long as you repay them within a 15year period.

Recent Changes to the Home Buyers' Plan
Now, let’s talk about the recent changes to the HBP. These updates are designed to make homeownership more accessible and beneficial for Canadians. Here are the key changes:

1. Increased Withdrawal Limit
First, the increased withdrawal limit. Previously, the maximum amount you could withdraw from your RRSPs under the HBP was $25,000. This limit has now been raised to $35,000 per person. For a couple, this means you can withdraw up to $70,000 combined, providing more financial flexibility when purchasing a home.

2. Extension for Breakdowns of Marriage or CommonLaw Partnerships
Second, the extension for breakdowns of marriage or commonlaw partnerships. Earlier, only firsttime homebuyers could use the HBP. Now, even if you’re not a firsttime homebuyer but you’re experiencing a breakdown of marriage or commonlaw partnership, you may still qualify to use the HBP, given certain conditions are met.

3. Flexible Repayment Terms
Third, more flexible repayment terms. While the repayment period remains 15 years, the changes offer more guidance and support for those who might face financial difficulties during repayment.
These updates are designed to make homeownership more accessible and flexible for more Canadians.

Also do check out my other video regarding the First Time Home Buyer’s Savings Account! That’s a juicy one you don’t’ want to miss if you are planning on buying your first home!

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Home Buyers' Plan Updates 2024 | Bloom Accounting


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