401k Withdrawal for a house?

You guys south of the border are lucky to get tax credits for first time home purchases, here in the great white north we get squat. Also I heard that you get to use mortgage payments as personal deductions against your income taxes (true or false ?) In my opinion, tax implications aside, if I would have put money into RRSP's (same as 401K) instead of investing in my first home then susequent others (playing the real estate market over the years) I might have 100K saved rather than a paid off house worth 10 times that. Real estate always goes up in the long run so long as you're confident you can always manage the payments even in tough times. Don't get me wrong, saving in a retirement plan is a must (especially the tax benefits) but for me, if you're young, get a place of your own while the prices are down first. Start affordable, work your way up. Good luck. Kev