What Can You Hold in an FHSA?
A Canadian’s checklist of eligible investments — and why real estate itself isn’t one of them
You open your new FHSA, log into your brokerage account, and type "real estate" into the search bar. Nothing useful comes up. You’re not doing anything wrong — the account simply wasn’t built to hold a house.
A First Home Savings Account (FHSA) is a registered plan that must limit its holdings to what the Canada Revenue Agency calls qualified investments. That rule shapes everything you can and can’t put inside it.
Key takeaways
- An FHSA can generally hold cash, mutual funds, GICs, and most securities listed on a designated stock exchange, per the CRA.
- The FHSA follows the same qualified investment rules as a TFSA, according to the Department of Finance.
- Land, shares of a private corporation, and general partnership units are not allowed, per Passiv.
- Holding a prohibited investment can trigger a 50% tax on its value, according to a provincial credit union’s FHSA guide.
What exactly counts as a "qualified investment"?
The CRA’s list of common qualified investments includes cash, mutual funds, most securities listed on a designated stock exchange, and guaranteed investment certificates, according to the CRA. The CRA says the types of investments permitted in an FHSA are generally the same as those permitted in an RRSP and a TFSA, per the CRA. CIBC confirms the same principle on its own FHSA page, noting the account is permitted to hold the same types of qualified investments as other registered plans, per CIBC.
In practice, that gives you a fairly wide menu. The table below breaks it down by type, so you can see at a glance what typically fits and what doesn’t.
| Investment type | Allowed in an FHSA? | Source note |
|---|---|---|
| Cash / savings deposits | Yes | RBC lists savings deposits as a product offering, per RBC |
| GICs | Yes | Listed as a common qualified investment, per the CRA |
| Mutual funds | Yes | Listed as a common qualified investment, per the CRA |
| Stocks on a designated exchange | Yes | "Most securities listed on a designated stock exchange," per the CRA |
| ETFs, bonds, options | Yes | Listed among product offerings, per RBC |
| Publicly traded REITs | Yes | Units of REITs listed on a designated stock exchange are qualified investments, per the CRA’s qualified investments folio |
| Direct ownership of land or a house | No | Land is not available to be used, per Passiv |
| Shares of a private corporation | No | Not available to be used, per Passiv |
| General partnership units | No | Generally considered non-qualifying, per Advisor.ca |
Your issuer may trim this list further. The CRA notes that an issuer may have internal policies that further limit which qualified investments it will let you hold, per the CRA. Always check your specific institution’s product list before assuming something is available.
Why can’t I just buy a rental property inside my FHSA?
This is the question that trips people up most. Land is explicitly excluded from the list of usable FHSA investments, per Passiv. The account is built to hold financial instruments — cash, securities, deposits — not physical property with a deed attached to it.
That said, units of publicly traded real estate investment trusts are qualified investments when they’re listed on a designated stock exchange, per the CRA’s qualified investments folio, which gives investors a way to get real estate exposure without breaking the rules. That’s a different route from owning a building outright, and worth understanding before you assume your FHSA can act like a property down payment fund with a deed attached.
What about foreign dividends and withholding tax?
If your FHSA holds foreign stocks that pay dividends, that income could be subject to foreign withholding tax, per the CRA. It’s a detail easy to miss when you’re focused on contribution room and deadlines, but it affects your actual after-tax return. Worth factoring in if a chunk of your FHSA is in U.S. or international equities.
A simple checklist before you buy
Before adding anything new to your FHSA, run through a short mental checklist. It takes two minutes and avoids a tax headache later.
Where does private real estate fit for Canadian investors?
An FHSA is one tool for one specific goal: a first home. For broader portfolio exposure to real estate, Canadians typically look outside registered first-home accounts toward private real estate investment funds or compare REITs versus private real estate funds directly. If you’re also weighing how an RRSP fits into the picture, this guide to using your RRSP for real estate walks through the mechanics.
FAQ
Can I hold a REIT inside my FHSA?
Units of a REIT listed on a designated stock exchange are qualified investments, per the CRA’s qualified investments folio. Whether a specific REIT qualifies depends on its structure, so confirm eligibility with your issuer before buying.
Can I put cryptocurrency in my FHSA?
Cryptocurrency itself is generally considered non-qualifying, though a cryptocurrency ETF is qualified if it’s listed on a designated exchange, per Advisor.ca. Check with your issuer before buying.
What happens if I accidentally hold a non-qualified investment?
If an FHSA holds a non-qualified investment, the account is taxable on any income and capital gains it produces, per the CRA. Prohibited investments are a separate category that can trigger a 50% tax on the property’s value at the time it was purchased or became prohibited, according to a provincial credit union’s FHSA guide.
Is the FHSA investment list the same as a TFSA?
Yes. An FHSA is permitted to hold the same qualified investments currently allowed in a TFSA, according to the Department of Finance.
Can my FHSA own a house directly?
No. Land is excluded from the investments you can hold, per Passiv.
