Mortgage Blog
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New Federal Housing Measures Nov 2023
January 3, 2024 | Posted by: Jeremy Schaffner
The federal government of Canada has just announced a series of housing-focused measures aimed at increasing the supply of rental housing across the country.
Here’s a summary of the key points that may impact you:
1. $20 Billion in Funding: The government will unlock an additional $20 billion in low-cost financing for the construction of rental housing. This funding comes from an increase in the annual limit for Canada mortgage bonds, from $40 billion to up to $60 billion.
2. Construction of New Homes: The new financing is expected to help build up to 30,000 more rental apartments per year.
3. GST Rental Rebate: As part of Bill C-56, the Affordable Housing and Groceries Act, the government will be removing the GST on new rental housing construction across the country. The GST Rental Rebate will increase from 36% to 100%, removing the existing phase-out thresholds for new rental housing projects. For a two-bedroom rental unit valued at $500,000, this would deliver $25,000 in tax relief.
4.Incentives for More Construction: The aim of these measures is to incentivize the construction of more apartment buildings, student housing, and senior residences.
Finance Minister Chrystia Freeland assured that the funding will not affect any other item already budgeted for this year. Housing Minister Sean Fraser encouraged builders to get shovels in the ground and leverage all the tools at their disposal to build more homes for Canadians.
