Key housing measures and their implications Parliament passed Budget 2025 on November 17 in a narrow 170–168 vote, formally approving the federal government’s housing and affordability measures for the year ahead.
The following section highlights the most relevant housing and mortgage changes in the budget: what’s new, what’s ending, and how each measure could affect your clients and day-to-day business. A client facing Template is now available in your CRM titled: "2025 Federal Budget" for those wishing to share with their client base.
1. Elimination of the Underused Housing Tax (UHT) - The UHT (1% annual tax on the value of certain vacant or under-used residential properties) will be eliminated effective with the 2025 calendar year. No tax and no return required for 2025 and subsequent years.
- Implications: For investors, trustees or corporations previously required to file UHT returns, underwriting checklists and legal instructions must reflect that from 2025 onward the UHT no longer applies. However, filings and penalty/interest risk remain for 2022-2024 years.
- Broker action: Update client checklists for second homes, trusts and small corporations to reflect this change. Review and clear any outstanding UHT filings for previous years.
2. Cancellation of the Canada Secondary Suite Loan Program - The government confirmed that the Canada mortgage and Housing Corporation will not proceed with the Secondary Suite Loan Program announced in 2024. That program had been designed to offer up to $40,000 in low-interest loans to homeowners adding basement or laneway suites.
- Ottawa said the cancellation is part of efforts to achieve 15% savings across CMHC programs by winding down initiatives that don’t directly add new housing supply or target Canadians in greatest need.
- Broker note: Homeowners interested in building secondary units can still access insured refinancing options introduced in early 2025 that allow loan proceeds to be used for secondary-suite construction. Brokers should update marketing materials and calculators to direct clients toward these insured-refinance pathways instead. (For more information, see the CMHC Refinance fact sheet)
3. First-time homebuyer GST/HST rebate (confirmed measure) - The budget confirms the government’s plan to remove the federal GST on new homes purchased by first-time buyers valued up to $1 million, and to reduce the GST for homes priced between $1 million and $1.5 million.
- Eligible buyers must not have owned a home in the year of purchase or in the previous four years, and the property must be a new or substantially renovated primary residence. For builder-purchased homes, the agreement of purchase and sale must be signed on or after May 27, 2025 and before 2031; construction must begin before 2031 and be substantially complete before 2036. (Source: Department of Finance)
- Broker action: For qualifying clients, build the rebate discussion into the early meeting: confirm first‐time status, contract dates and home type. Make sure to gather documentation on the purchase agreement date and construction timelines for owner-built homes. Update purchase checklists accordingly.
4. Energy-efficiency program consolidation (Natural Resources Canada) - Natural Resources Canada (NRCan) will streamline its housing-related programs by winding down several initiatives, including the Canada Greener Homes Grant. The department will instead "prioritize projects that deliver the most benefits for Canadians."
- The Canada Greener Homes Grant had provided up to $5,000 for eligible energy-efficiency upgrades, such as window replacements, insulation, and heat pumps. While not included in the budget documents, the government has also closed the Canada Greener Homes Loan to new applicants.
- Broker note: Clients planning energy-related renovations should be advised that both the federal grant and loan programs are no longer open. Brokers can help clients explore other funding options, including insured refinancing products or remaining provincial and utility-level incentives that may still support efficiency upgrades.
5. Build Canada Homes and the Build Communities Strong Fund - Budget 2025 launches the Build Canada Homes initiative, a $13 billion, five-year investment aimed at accelerating the construction of non-market and affordable housing. The program will use federal lands, partnerships with provinces, municipalities, and Indigenous governments, and modular-building methods to deliver housing more quickly and at lower cost.
- The initiative is part of the federal strategy to increase supply in areas facing the most severe housing shortages and to expand affordable rental options. Build Canada Homes will also complement existing CMHC and Infrastructure Canada programs by streamlining how land and capital are deployed for housing projects.
- Broker note: While not a direct mortgage-financing measure, the program signals potential future growth in markets where large-scale federal housing projects are planned. Brokers may wish to monitor local announcements or partnership agreements under this program, as they could lead to new construction, employment opportunities, and eventual resale activity in affected regions.
6. Canada Mortgage Bonds expansion - The federal government will raise the annual Canada Mortgage Bonds (CMB) issuance limit to $80 billion from $60 billion as part of its phased plan to expand the program. The additional capacity is intended to strengthen mortgage-market liquidity and lower borrowing costs for lenders and developers financing CMHC-insured multi-unit rental projects.
- Eligible properties must include at least five units and can include apartments, student housing, or seniors’ residences.
- Broker note: While not directly tied to single-family lending, the larger CMB allocation could influence funding costs for lenders and, over time, impact rates. Brokers working in the commercial or multi-unit space may also see expanded financing opportunities under the CMHC-insured rental programs.
Other industry developments to watch
Budget 2025 introduces plans for a National Anti-Fraud Strategy and amendments to the Bank Act aimed at strengthening consumer protection against financial scams. Banks will be required to implement enhanced fraud-prevention policies, provide customers with greater control over account features, and report anonymized fraud data to the Financial Consumer Agency of Canada.
While these measures do not directly impact mortgage qualification or broker operations, they signal a broader push toward stronger financial security and data protection across the industry. Brokers may wish to remind clients to verify email requests, links, or document uploads before sharing personal or financial information, especially when dealing with large transactions such as home purchases or mortgage renewals. |