Three federal programs let Calgary first-time buyers stack government savings: the FHSA saves up to $40,000 tax-free, the RRSP Home Buyers' Plan unlocks $60,000 per person, and new-build buyers claim GST rebates at closing. Combined with Alberta's zero land transfer tax, these programs can reduce your down payment requirement by $100,000 or more.
The First Home Savings Account (FHSA): Tax-Deductible Savings for First-Time Buyers
The FHSA, introduced in 2023, is a dedicated savings vehicle designed specifically for first-time buyers. It operates like a tax-deductible RRSP but with tax-free withdrawals—meaning you deduct contributions from your income for tax purposes and withdraw the funds tax-free when you buy.
FHSA Contribution Limits:
$8,000 per calendar year (2024–2026)
Lifetime contribution limit: $40,000
Unused contribution room carries forward one year only (important: room does not accumulate indefinitely)
Contribution deadline: December 31 of each year
Who Qualifies: You're eligible if you're 18 or older and haven't owned a principal residence in the current calendar year or the previous four years. This is broader than many assume—you don't need to be a first-time buyer in the strict sense. If you owned a home five years ago, you're eligible again.
FHSA Withdrawal Rules: You must withdraw funds to purchase your first principal residence—you can't use FHSA money to invest in a rental property or cottage. The home must be in Canada, and you must occupy it as your principal residence.
Realistic Calgary Example: If you opened an FHSA in 2023 and contributed $8,000 annually, by mid-2026 you'd have $24,000 saved plus growth. That contribution is tax-deductible—if you're in a combined federal and Alberta marginal tax bracket of roughly 36% (approximately $150,000–$205,000 income), a $24,000 contribution saves you approximately $8,640 in taxes. Reinvest those tax savings into your FHSA, and you accelerate growth toward the $40,000 limit.
RRSP Home Buyers' Plan (HBP): Withdraw Up to $60,000 Per Person
The RRSP Home Buyers' Plan is one of Canada's most underutilized first-time buyer tools. As of April 2024, the federal budget increased the maximum withdrawal from $35,000 to $60,000 per person. Married couples can each withdraw $60,000—totalling $120,000.
HBP Limits and Eligibility:
Maximum withdrawal: $60,000 per person (increased from $35,000)
Married couples: up to $120,000 combined ($60,000 each)
Must be a first-time buyer (same rule as FHSA: haven't owned a principal residence in the current or prior four calendar years)
Must withdraw within 90 days of closing on your home
Repayment Terms: Unlike an FHSA withdrawal, HBP funds must be repaid to your RRSP. You repay over 15 years (equal instalments). If you default on repayment, the unpaid amount becomes taxable income.
HBP + FHSA Stacking: You can use both in the same year. A single buyer could withdraw $60,000 via HBP and $8,000 via FHSA in 2026, totalling $68,000 from government programs. A couple could access $120,000 (HBP) + $16,000 (FHSA combined) = $136,000.
Important: HBP withdrawals don't count as income for mortgage qualification purposes. Lenders treat the withdrawal as a down payment source, not income.
GST/HST New Housing Rebate: Alberta's Automatic Savings on New Builds
Alberta has no provincial sales tax, only the federal 5% GST. When you purchase a new home (not a resale), the builder or developer typically applies the GST/HST New Housing Rebate at closing.
Rebate Amounts in Alberta:
Full rebate (36% of GST paid, up to $6,300): Available on new homes with a base purchase price up to $350,000
Partial rebate: Homes with a base price between $350,000 and $450,000 qualify for a reduced rebate that phases out to zero
No rebate: Homes with a base price over $450,000
Example Calculation: A new home in NW Calgary priced at $340,000 (before GST) costs $357,000 with GST included. The GST paid is $17,000. The 36% rebate returns $6,120. The builder often applies this rebate directly at closing, reducing your net purchase cost.
This rebate is automatic—the developer handles it. You don't apply separately, but verify the contract specifies the rebate amount.
Alberta's Zero Land Transfer Tax: A Major Advantage
Many Canadian provinces charge a land transfer tax (often 1–4% of purchase price). Ontario's provincial land transfer tax on a $500,000 home is approximately $6,500, and Toronto buyers pay a second municipal tax on top, bringing the total to roughly $13,000. British Columbia charges up to 5% on properties over $3,000,000.
Alberta: Zero land transfer tax on all residential real estate.
For a Calgary home purchase of $500,000, you save $6,500–$13,000 compared to buyers in Ontario (including those in Toronto), purely from Alberta's zero-tax advantage. This is one reason Alberta real estate remains accessible to first-time buyers.
Stacking Programs: A Realistic Calgary Scenario
Let's work through a couple's first-time buyer plan in mid-2026:
Assumptions:
First-time buyer couple, each with $40,000 saved in personal savings
Both have active RRSPs ($80,000 each)
Combined household income: $180,000
Target purchase price: $575,000 (modest SE Calgary home or small NW property)
Available Down Payment:
Personal savings: $80,000
RRSP Home Buyers' Plan (HBP): $60,000 (Person A) + $60,000 (Person B) = $120,000
FHSA (stacked with HBP): $8,000 (Person A) + $8,000 (Person B) = $16,000
Total government-sourced down payment: $136,000
Combined down payment: $216,000
Down Payment Percentage: $216,000 ÷ $575,000 = 37.6%
This exceeds the 20% threshold needed to avoid CMHC mortgage insurance. The mortgage would be $359,000 (amortized over 25 years at current rates—roughly 5.5% in mid-2026—approximately $2,000/month).
Mortgage Qualification: Lenders don't count HBP and FHSA withdrawals as income, but they do verify sufficient funds exist. Your lender will confirm balances before closing.
Compare this to a couple relying only on personal savings: they'd have $80,000 down (13.9%), triggering CMHC insurance of approximately $15,345 (3.1% of a $495,000 mortgage), increasing the mortgage amount and monthly payment. By stacking programs, this couple avoids insurance entirely—saving over $15,000 over the mortgage term.
What Happened to the First-Time Home Buyer Incentive (FTHBI)?
The FTHBI, introduced in 2019, allowed first-time buyers to borrow up to 10% of the home price from the federal government as a shared-equity mortgage. The program was suspended in March 2024 and is no longer available.
If you're researching older articles or Reddit threads mentioning FTHBI, ignore them—it's not an option in 2026. Rely on FHSA and HBP instead.
Alberta-Specific Buyer Rules: RECA Disclosure
Alberta's Real Estate Council of Alberta (RECA) requires buyer agent representation to be clearly disclosed. As of December 2023, Alberta's buyer agent rules changed: buyers must be represented by an agent with a clear agency agreement, not simply as customers.
When you're ready to make an offer in Calgary, your agent must confirm:
Your agency relationship (buyer's agent represents your interests, not the seller's)
Commissions are disclosed (typically split by the seller's agent and buyer's agent)
Confidentiality applies to your financial position and purchase motivation
This protects you and ensures professional representation.
How to Use These Programs: Practical Steps
1. Open an FHSA Immediately Most Canadian banks and investment institutions offer FHSA accounts. You can contribute up to your annual limit ($8,000 in 2026), invest it conservatively or aggressively based on your timeline, and carry forward unused room one year.
2. Review Your RRSP Balance Check your RRSP statement with your bank or investment provider. Confirm you have sufficient RRSP balance to withdraw via HBP. The full $60,000 must come from your own RRSP (spousal RRSPs have special rules—consult a tax professional).
3. Obtain a Pre-Approval Letter Meet with a Calgary mortgage lender. They'll pre-approve you based on your income, credit, and confirmed down payment sources. This letter is essential when making an offer.
View available homes and connect with Mark to get pre-approved
4. Budget for Closing Costs Down payment programs cover down payments, not closing costs. Budget 1.5–2% of the purchase price for legal fees, inspections, title insurance, and property tax adjustments. On a $575,000 home, that's $8,600–$11,500.
5. Consult a Tax Professional HBP withdrawals must be repaid. A tax accountant can help you structure repayment and coordinate FHSA and HBP timing to maximise your first year's tax benefits.
Explore our first-time buyer resources and start your journey today
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Frequently Asked Questions
Can I use FHSA and HBP in the same year?
Yes. Both programs are designed to stack. You can contribute to your FHSA and withdraw from your RRSP via HBP in the same calendar year. Many first-time buyers use both to maximise their down payment pool.
What if I haven't owned a home in five years—am I eligible?
Yes. Both FHSA and HBP use the same eligibility test: you can't have owned a principal residence in the current or previous four calendar years. If you owned a home in 2021 and sold it, you're eligible again starting January 1, 2026 (four years later). Verify your exact eligibility with your lender or tax professional.
Do I have to repay the FHSA money like HBP?
No. FHSA withdrawals are permanent and tax-free. You don't repay FHSA funds. However, HBP withdrawals must be repaid to your RRSP over 15 years. The two programs have very different repayment rules.
Will CMHC insurance cost less if I use these programs?
Absolutely. If your down payment reaches 20% (no insurance required), you eliminate CMHC insurance premiums entirely. Even small improvements—moving from 10% to 15% down—reduce insurance costs dramatically. In the scenario above, stacking programs saved this couple approximately $15,000 in insurance costs.
Does the new housing rebate apply to resale homes?
No. The GST/HST rebate only applies to new homes purchased directly from the builder or developer. Resale homes don't qualify. If you're buying a resale home in Calgary, you won't receive a rebate, but you'll benefit from zero land transfer tax.
What happens if I can't repay my HBP withdrawal?
If you miss a repayment, the unpaid amount becomes taxable income in that year. For example, if you were supposed to repay $4,000 in Year 3 but didn't, that $4,000 is added to your taxable income, and you'll owe tax on it (plus potentially penalties). This makes HBP repayment a serious obligation—treat it like a loan you owe yourself.
Are there income limits for FHSA or HBP?
No income limits apply to either program. You can earn $250,000 annually and still qualify. The only limits are contribution room and eligibility rules (first-time buyer status, principal residence ownership history).
About the Author
Mark John is a REALTOR® with RE/MAX First in Calgary, AB. With a background in nursing and skilled trades, Mark understands the financial discipline and planning that first-time buyers need—and he's guided hundreds of Calgary first-time buyers through FHSA, HBP, and down payment planning to secure their first homes. An inductee into the RE/MAX Hall of Fame, RE/MAX Top 100 agent, and RE/MAX Chairman's Club recipient with over 100 five-star client reviews, Mark brings a methodical, empathetic approach to the most important financial decisions his clients face.
Whether you're exploring FHSA and HBP options, comparing neighbourhoods in SE or NW Calgary, or ready to make an offer, Mark is available to guide you through every step.
Mark John, REALTOR® RE/MAX First — Calgary, AB 403-519-4919 markjohnrealty.com
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