Canada Strong: Federal Budget 2025

Canada’s housing market just got another big spotlight in the 2025 federal budget — and if you’re thinking about buying, investing, or just trying to make sense of all the changes, here’s what you need to know...

1. The Government’s Big Housing Push

The new Build Canada Homes initiative is being called the government’s “flagship” housing program — with $13 billion over five years and a goal to double the pace of home construction over the next decade.

This program pulls together existing efforts like the Housing Accelerator Fund, Apartment Construction Loan Program, and the conversion of unused federal buildings into homes. The idea is to build faster, more efficiently, and at a much larger scale — using modern construction methods to cut timelines and costs.

What this means for you is that we start to see more supply hitting the market in the years ahead — which could help with long-term affordability, especially for first-time homebuyers and renters. Though these effects won’t happen overnight. New construction takes time, and demand is still outpacing supply in most regions.

2. Help for First-Time Homebuyers

One of the biggest direct benefits in this budget is the removal of the GST on new homes for first-time buyers (up to $1 million in value).

That means up to $25,000 in savings on a $500,000 home — and it’s designed to make entry-level new builds more attainable.

If you’ve been looking at pre-construction homes or new builds, this is definitely a change worth exploring. Combined with flexible mortgage options, it could open the door to homeownership sooner than you think.

3. Boosting the Mortgage and Rental Markets

The government is also expanding the Canada Mortgage Bonds (CMB) program — increasing its annual cap from $60 billion to $80 billion.

That might sound technical, but it basically means more liquidity and lower borrowing costs for lenders and developers — which helps get more rental and multi-unit projects built. Over time, that could improve housing options and stabilize rents.

4. What’s Missing

Many in the mortgage industry were hoping for progress on an income verification system through the CRA — something that could have made the mortgage process smoother and reduced fraud. That didn’t make it into the budget, but it’s still on the industry’s radar.

In short:

The 2025 budget isn’t a quick fix, but it continues the shift toward a long-term, high-volume housing strategy — one that aims to address affordability through supply, efficiency, and investment.

As a mortgage professional, I’m watching these changes closely because they affect your borrowing power, housing options, and timing in the market.

If you’re thinking about buying or refinancing, it’s a great time to talk about how these policies might shape your next move. Reach out to me anytime to discuss: cvanderluit@firstfinanciallending.ca