Results Are In: Canada Elects New Federal Government
- Mark
- 2 days ago
- 3 min read
Canada Elects New Federal Government: What It Means for Housing, Mortgages, and the Economy
Canada’s 2025 federal election has concluded with a new government forming a minority mandate. As voters prioritized affordability and economic stability, the new leadership now faces a critical turning point: stabilizing the economy, addressing trade risks, and tackling Canada’s growing housing crisis.
Here’s how the key policy promises could impact Canadians.
Housing Supply: New National Building Strategy
Housing affordability took centre stage in the election, with the government pledging aggressive measures to expand housing supply. According to the Canada Mortgage and Housing Corporation, Canada needs to build 3.5 million homes by 2030 to restore affordability.
Key policies include:
Launching Build Canada Homes, a federal housing body focused on boosting construction.
$10 billion in financing for affordable housing developers.
$25 billion allocated for pre-fabricated homes using Canadian materials like mass timber and softwood lumber.
Acting as a public developer, building homes on federal land to reduce costs.
Reintroducing a Multi-Unit Rental Building (MURB) tax incentive for rental housing.
Reducing municipal development charges by 50% for multi-unit builds for five years.
Implementing pre-approved building designs to streamline approvals.
Mortgages: Exploring Long-Term Stability
The government has committed to exploring longer-term mortgage products, such as 10-year fixed-rate options, to give borrowers more financial stability. While not widely used in Canada, these products could offer protection from rate fluctuations—provided a viable funding model is introduced through broader lender participation.
However, a larger projected fiscal deficit could dampen expectations of further Bank of Canada rate cuts, as higher government spending may lessen the need for monetary stimulus. Following the election, bond yields rose slightly in anticipation of increased government debt issuance.
Cost of Living: Tax Relief and Domestic Trade Reforms
To ease pressure on household budgets, several initiatives are being rolled out:
A 1% income tax cut for the lowest bracket, saving up to $825/year for dual-income families.
Expanded dental care for Canadians aged 18–64, expected to save individuals up to $800/year.
Plans to reduce interprovincial trade barriers, potentially cutting internal trade costs by 15%.
Streamlined credential recognition to improve labour mobility across provinces.
Economic Resilience: Investment and Jobs
In response to global trade instability and rising U.S. protectionism, the new government is rolling out a $2 billion Strategic Response Fund to:
Support industries vulnerable to tariffs, such as auto and manufacturing.
Fund worker upskilling and workforce retention.
Boost innovation and competitiveness in key sectors.
Additionally, $150 billion in public capital will be used to unlock $500 million in private investment across critical industries including:
Housing and infrastructure
Digital technology and intellectual property
Energy, critical minerals, and clean manufacturing
Climate Risk & Insurance: Making Coverage More Affordable
With severe weather driving up insurance premiums, the government is targeting reforms to ease costs and enhance climate resilience:
A new National Flood Insurance Program will launch by April 2026.
Federal funds will retrofit homes for wildfire and flood resistance.
New rules will prevent construction in high-risk flood zones.
Updated building codes will support climate-resilient construction.
All programs will be funded by an expanded carbon credit system, placing the cost burden on major polluters.
In 2024 alone, weather-related insured damages reached $8.5 billion, underlining the urgency of these changes.
What Comes Next
With affordability, housing, and climate challenges front and centre, the new government’s policies aim to balance short-term relief with long-term structural change. As these plans move from promise to policy, Canadians will be watching closely.
Need help navigating the new landscape as a buyer, investor, or homeowner?
Connect with our team at REXIG.ca for insights and support.
416.822.7699 | info@rexig.ca
Sources
Disclaimer: The information provided in this blog post is for general informational purposes only and should not be construed as professional advice. REXIG Realty Investment Group does not guarantee the accuracy, completeness, or timeliness of the content. Readers are encouraged to seek professional advice tailored to their specific situation before making any real estate or investment decisions. REXIG Realty Investment Group is not responsible for any actions taken based on the information provided