With steep home prices, strict mortgage regulations and a high cost of living, today’s first-time home buyers face a major financial challenge. It’s no wonder so many turn to their parents for assistance.
According to the Canada Mortgage and Housing Corporation, three in 10 Canadian home buyers receive a gift to help purchase their home.¹ By contributing to your child’s down payment, you may be able to help them purchase a home sooner—perhaps years earlier. Also, your child is more likely to choose a home they want, without compromising.
Ways to help
Here are four common ways to contribute toward a down payment.
Funding an FHSA. Your child may not have the financial resources to contribute to a First Home Savings Account (FHSA), but you can gift funds to your child that they can contribute to their account. The maximum annual contribution is $8,000, and if you want to help out more with the down payment, you could also gift your child funds to contribute to their Tax-Free Savings Account (TFSA).
When you help out in advance, your gift has the opportunity to grow tax-free, and your child benefits from the FHSA tax deduction.
Gifting a lump sum. When you give your child a large gift now, you’re able to witness the difference you make—which isn’t the case when you leave them an inheritance in your will. Note that lenders typically require you to submit a mortgage gift letter to confirm your contribution toward the down payment is an outright gift, not a loan.
If you are considering this method, you can consult us to assess how a gift might affect your financial situation and long-term goals. We can look at any tax consequences of withdrawals and help you determine a gift amount that suits your wealth plan.
Providing a loan. If you’re uncomfortable gifting a lump sum, you may consider lending the amount to your child. In this case, you would prepare an agreement that documents the loan amount, repayment terms, interest rate and any other conditions—for your own benefit and to meet the lender’s requirements.
Co-signing the mortgage. Your child, or your child and their spouse, may be capable of making their mortgage payments but be held back from qualifying for a mortgage due to a credit, debt or other issue. To help out, you can co-sign their mortgage. However, you will be liable to cover any payments your child is unable to make, and co-signing may limit your ability to borrow in the future.
If you have more than one child
Deciding whether to help a child buy a home takes more thought if you have other children. When you help only one child, you risk making the others resentful. One solution is to gift each child an equal sum when they decide to purchase their first home.
If only one child needs financial help, you could update your will to reduce their inheritance by the amount of the gift. Or you could help out with a loan, instead of a cash gift. Whichever solution you choose, it’s important to communicate your plan to all of your children.
[1] Canada Mortgage and Housing Corporation, “Mortgage Consumer Survey,” 2024.
This article is excerpted from the Well‑Advised Spring 2026 Newsletter and published on behalf of your financial advisor for clients residing in jurisdictions where they are registered. This material is provided solely for informational and educational purposes and is not to be construed as an offer or solicitation for the sale or purchase of any securities or as providing individual investment, tax or legal advice. Consult your professional advisor(s) prior to acting on the basis of this material. Insurance products are available through advisors registered with applicable insurance regulators. In considering any particular investment, please remember that past performance is no guarantee of future performance. Although this material has been compiled from sources believed to be reliable, we cannot guarantee its accuracy or completeness. All opinions expressed and data provided herein are subject to change without notice. Neither CI Assante Wealth Management Ltd. their affiliates or their respective officers, directors, employees or advisors are responsible in any way for any damages or losses of any kind whatsoever in respect of the use of this material. CI Assante Wealth Management is a registered business name of Assante Wealth Management (Canada) Ltd. CI Assante Wealth Management Ltd is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization.
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