What Changed for the Home Buyers’ Plan (HBP)
- For withdrawals between January 1, 2026 and December 31, 2028, the repayment grace period under the HBP has been extended from 2 years to 5 years before you must start repaying amounts withdrawn from your RRSP. (budget.canada.ca)
- This mirrors earlier relief given to those who made HBP withdrawals between 2022–2025. (canada.ca)
- The long-standing 15-year repayment schedule still applies once repayments begin. (canada.ca)
Who Benefits Most
- First-time buyers who plan to use the HBP in 2026-2028 now have more breathing room — up to three extra years of no repayments. This can substantially ease financial pressure in the early years of homeownership. (budget.canada.ca)
- Buyers already in the HBP who withdrew during 2022-2025 have had the benefit automatically applied. (canada.ca)
Practical Example
| Scenario | Prior Rule | Under New Relief |
|---|---|---|
| First HBP withdrawal in 2026 of $60,000 | Repayments start in 2028, first payment $4,000/year (1/15th) | Repayments start in 2031, allowing grace through 2026-2030 |
| First withdrawal in 2024 | Start repaying in 2026 | Eligible for extended 5-year grace already in place |
Actionable Advice
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Delay repayment planning until the grace period ends: For those eligible, no mandatory repayments will be required until the fifth calendar year after the withdrawal year.
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Watch your balance: Even during grace periods, you can still make voluntary payments to reduce interest impact and shorten repayment burdens later.
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Maximize RRSP contributions early: Any contributions you make during the grace period still count toward your RRSP room and can be applied toward required payments once the repayment schedule begins.
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Review your withdrawal timing: If you expect cash flow constraints, arranging your first withdrawal within the eligible period (2026-2028) maximizes benefit.
Important Fine Points
- This extension applies only to first withdrawals in the stated periods. Subsequent or additional withdrawals may follow separate rules. (canada.ca)
- Loans still must be repaid over 15 years; the extension only delays when repayments begin. (canada.ca)
With this new HBP policy, eligible Canadians can enjoy greater flexibility during a critical time — the early years of homeownership — easing tax burdens when they need it most.