• Canadians' increasingly aware of FHSA features and benefits.
• Homebuyers divided over how mortgage rate changes will affect their ability to buy a home in the next two years.
• 23% of parents are expected to use the FHSA to help their children save for a home.

BMO's 15th annual Investment Survey reveals more than half (56%) of potential first-time homebuyers are planning to use the First Home Savings Account (FHSA) to help purchase their first home, up from 52% from 2023. The annual survey also finds the understanding of FHSAs is increasing and that parents are finding the FHSA an effective way to help their adult children save for a home.

Mind The Knowledge Gap

The FHSA knowledge gap is narrowing, with two fifths (40%) of Canadians indicating they have at least some knowledge of the account, up from 31% from last year. Nearly half (48%) of Gen Z are knowledgeable about the FHSA's features and benefits – the highest among any age group.

A (Tax-Free) Gift That Keeps on Giving

The BMO Investment Survey also explores how families across generations may be using the FHSA as a financial gift for their children. Nearly a quarter (23%) of parents will likely use the FHSA to help their adult children save for their first home.

Younger parents are also more likely to use the FHSA to help their adult children save for a home, according to the survey's findings:

• Millennial Parents: 42%
• Gen Z Parents: 21%
• Boomer Parents: 7%

"It is encouraging to see that over half of prospective buyers plan to use the First Home Savings Account to save, and we want to see that number grow because the FHSA is such a powerful tool. Benefits including the ability to make tax-deducible contributions, tax-free growth of the investments and the ability to hold various investment types make this plan the most advantageous way to save for a home. It is like an RRSP and TFSA rolled into one for first-time homebuyers," said Nicole Ow, Vice President and Head, Retail Investments, BMO. "For most, buying their first home will be part of a multi-year plan, involving several savings vehicles like the FHSA, RRSP withdrawals through the Home Buyers Plan, and may also involve multiple generations, with parents and grandparents contributing financially."

https://newsroom.bmo.com/2024-12-18-BMO-Investment-Survey-Over-Half-of-First-Time-Homebuyers-Plan-to-Use-First-Home-Savings-Account-FHSA-to-Buy-a-Home