Leveraging RRSPs and TFSAs for Real Estate Investing in Canada

If you’re like most Canadians, your RRSP or TFSA is filled with mutual funds or ETFs. But did you know these accounts can also fund real estate investments—legally and strategically?

With the right structure, registered funds can generate passive, tax-sheltered real estate income. Whether you’re a private lender, REIT investor, or MIC participant, it’s time to explore how your retirement savings can work harder in the real estate space.

1. What You Can’t Do

Let’s start with the most important point: you can’t buy a rental property directly in your RRSP or TFSA.

But you can invest in real estate indirectly through:

• Real Estate Investment Trusts (REITs)

• Mortgage Investment Corporations (MICs)

• Private mortgages (through a trustee)

• Syndicated real estate funds

All of these allow you to participate in the real estate market—while enjoying the tax advantages of registered accounts.

2. REITs and MICs: Easiest Entry Point

REITs (Real Estate Investment Trusts) are publicly traded funds that invest in real estate portfolios—residential, commercial, or industrial.

MICs pool investor capital to lend money on real estate-backed mortgages. They often target higher yields (8–10%) and are more niche than REITs.

Both can be bought through most brokerage accounts and held in RRSPs or TFSAs.

3. Private Lending with Your RRSP/TFSA

Want to earn 8–12% interest while helping another investor close a deal? With a self-directed RRSP or TFSA, you can lend money as a mortgage on real property.

But there are rules:

• You must use a CRA-approved trustee (e.g. Olympia Trust)

• The borrower must be arm’s-length (i.e. not your company or family)

• The loan must be properly documented and secured

This is ideal for experienced investors looking to generate passive, consistent returns with capital that’s otherwise sitting idle.

4. Compliance and Strategy

Using your registered funds to invest in real estate legally means:

• No self-dealing (e.g. lending to yourself or your own company)

• Proper due diligence on any fund or borrower

• Working with professionals: trustees, accountants, and lawyers

Also consider which account to use:

• RRSPs offer tax-deferred growth but are taxed on withdrawal

• TFSAs offer tax-free growth and withdrawals—ideal for high-yield real estate plays

Final Thoughts

Your registered accounts aren’t limited to the stock market. With the right setup, they can power your real estate investing strategy—creating tax-efficient, passive income with better downside protection.

At Greenell Capital, we connect investors with trusted REITs, private lending opportunities, and MICs that are eligible for RRSP/TFSA use—so you can build your portfolio inside and outside the traditional system.