Budget 2025 is seen as an “intergenerational” plan to rebuild Canada’s economy, a theme that the finance minister mentioned at least 25 times in his speech to emphasize the scale and long-term nature of the government’s investments in housing, infrastructure and productivity.
The budget includes capital spending totaling $450.6 billion over five years, and a projected deficit of $78.3 billion in 2025-26 as the government reclassifies major spending as long-term investment rather than annual program costs. On an annual basis, capital spending is expected to increase from $32 billion in 2024-25 to nearly $60 billion in 2029-30.
The government has also committed $115 billion over five years to new infrastructure spending, bringing total infrastructure investment to about $315 billion under the broader capital plan.
Notably, there is no mention or update in the budget of the Canada Revenue Agency-backed income verification system, a tool the previous Liberal government was exploring to help prevent mortgage fraud and improve underwriting standards across the financial sector. The only development since then has been the release of a CRA report supporting industry calls for such measures.
Budget strengthens existing housing strategy
Housing remains a key pillar of Budget 2025’s Generational Vision, with $25 billion in new measures over five years and a total federal housing commitment of approximately $130 billion, including $13 billion for the government’s flagship Building Canada Homes program.
Much of the funding is being channeled through expanded or consolidated programs under a new framework that brings together initiatives such as the Housing Accelerator Fund, the Apartment Construction Loan Program and the Federal Land and Office Conversion Program to better coordinate financing and accelerate construction nationwide.
“Canada faces a massive housing supply gap that threatens Canadians’ affordability, opportunity and ability to build their lives at home,” said Finance Minister François-Philippe Champagne. He described Building Canada Homes as “the most ambitious housing program since World War II” that will “build at a pace and scale not seen in generations,” with the goal of doubling the pace of construction over the next decade.
Overall, Budget 2025 introduces few new housing schemes beyond those previously announced by the federal government. Most of the housing measures, such as Building Canada Homes, eliminating the GST on new homes for first-time buyers, and other plans, build on existing commitments from the 2024 Budget and subsequent government announcements.
The Canadian Association of Mortgage Professionals welcomes the federal government’s continued focus on housing and affordability measures, particularly the previously announced elimination of the Goods and Services Tax on new homes for first-time buyers, which CEO and president Lauren van den Berg called “an important measure that will help unlock affordability and open the door to home ownership for more Canadians.”
Van den Berg added that while the MPC supported initiatives such as the national anti-fraud strategy and the establishment of a financial crime agency, it would like to see new progress on the CRA-backed income verification system, which she called “a key solution in the fight against money laundering and fraud in the real estate industry”.
Overview of housing measures
- Building Canada Home Officially Launches: Described by the government as the flagship housing scheme in Budget 2025, although it represents more of a structural shift than a completely new scheme. As mentioned above, it receives $13 billion in support over five years and establishes a single federal agency to coordinate housing delivery and financing across sectors, integrating programs such as Build Canada, the Housing Accelerator Fund and the Federal Lands Initiative.
Under the new capital budget framework, Housing Canada will have greater flexibility to fund projects over multiple years and attract private and institutional investment, the government said. The plan also places a renewed emphasis on modular and industrial construction methods to reduce costs and schedules (in some cases by up to 50%), and aims to reduce emissions by approximately 20% during construction
“Building Canada Homes will catalyze the creation of a new Canadian housing industry that uses modern construction methods to increase productivity sustainably and at scale,” the budget reads, adding that the plan will “deploy capital, create demand and leverage innovative housing technologies to build faster and more sustainably 365 days a year.”
- Goods and Services Tax (GST) exemption on first-time purchase of new home. The budget confirmed the federal government’s plans to scrap goods and services tax (GST) on new homes worth up to $1 million for first-home buyers, a measure originally announced in March 2025. The government says the change will help more first-home buyers enter the market by reducing the total cost of an eligible new home by up to 5 per cent, or about $25,000 for a home worth $500,000.
The exemption only applies to new-build homes and is intended to stimulate supply in the entry-level market. However, some mortgage industry stakeholders hope the policy will further extend the GST exemption to all home buyers.
- Canada Mortgage Bond (CMB) limit increased to $80 billion. The government is implementing a phased plan to expand the CMB program and increase the annual issuance limit from US$60 billion to US$80 billion. The program’s cap was first raised in September 2023, when then-Treasury Secretary Chrystia Freeland raised the cap from $40 billion and committed an additional $20 billion in annual capacity to support CMHC-insured multi-unit rental housing.
The purpose of expanding the issuance is to enhance liquidity in the mortgage market and reduce borrowing costs for lenders and developers. Qualifying multi-unit rental projects must have at least five units and can include apartment buildings, student housing or senior housing.
The government added that it would maintain the current pace of purchases
CMB amounts to $30 billion per year.
- Aboriginal Housing Commitment. Budget 2025 does not introduce any new Aboriginal housing programs but expands existing commitments. It confirms $2.8 billion in additional funding for urban, rural and northern First Nations housing, part of an effort to address what the government calls “urgent” housing needs in First Nations, Inuit and Métis communities. Building Canada Homes will work with Indigenous leadership to coordinate priorities and support community-led delivery. By comparison, Budget 2024 allocates about $918 million over five years for Indigenous housing and infrastructure.
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- Canada Second Home Loan Program: The government confirmed it will not proceed with the Canada Secondary Home Loan Program announced in the 2024 budget, which originally promised $409.6 million over four years.
The program is designed to provide low-interest loans of up to $40,000 to homeowners building basement or laneway suites. The cancellation follows plans announced in late 2024 to expand the program to $80,000 loans at 2% interest over 15 years to help homeowners finance resale homes and increase rental supply.
The government said CMHC will end the program as part of an effort to achieve 15 per cent savings over three years “by gradually reducing programs that do not directly increase housing supply or target Canadians who need it most.” It also noted potential overlap with rule changes for insured mortgages due to be introduced in January 2025.
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Budget 2025 Building Canadian Homes CMB Plan François-Philippe Champagne Aboriginal Housing GST Lauren van den Berg Mark Carney Mortgage Professionals Canada Secondary Suite Incentive Program
Last modified: November 4, 2025
