Canadians work hard to achieve homeownership, but high mortgage payments present a significant challenge, especially for Millennials and Gen Z. To make it easier for younger generations to buy their first home, new mortgage regulations were introduced on August 1, 2024. These regulations allow for 30-year insured mortgage amortizations for first-time homebuyers purchasing new construction properties.
Today, Deputy Prime Minister and Finance Minister, Chrystia Freeland, announced a set of reforms aimed at making mortgages more affordable and putting homeownership within reach for more Canadians:
- Raising the $1 million insured mortgage price cap to $1.5 million as of December 15, 2024. This adjustment reflects current market conditions and helps more Canadians qualify for mortgages with less than a 20% down payment. The insured mortgage cap has remained unchanged since 2012, and increasing it will help more people buy homes in today’s housing market.
- Expanding 30-year amortization options to all first-time homebuyers and all purchasers of new construction properties starting December 15, 2024. This move will reduce monthly mortgage payments, making homeownership more accessible. By encouraging Canadians to purchase new builds, including condos, the government is also stimulating housing development and addressing the current housing shortage. This follows the August 1, 2024, implementation of 30-year amortizations for first-time buyers purchasing new construction properties.
These reforms are part of the government’s larger effort to enhance the Canadian Mortgage Charter, introduced in Budget 2024. Under this charter, all insured mortgage holders can switch lenders at renewal without having to pass a new mortgage stress test. This change promotes competition among lenders and allows Canadians with insured mortgages to secure better deals at renewal without requalifying.
These are some of the most significant mortgage reforms in decades, forming part of the federal government’s broader initiative to construct nearly 4 million new homes—the most ambitious housing plan in Canadian history, aimed at helping more Canadians become homeowners. Further details on these regulatory amendments will be provided in the coming weeks.
In addition to making mortgages more affordable, the government is taking steps to safeguard the rights of home buyers and renters. As part of Budget 2024, blueprints for a Renters’ Bill of Rights and a Home Buyers’ Bill of Rights were released. These measures aim to protect renters from unfair practices, simplify leases, and increase price transparency. For home buyers, the reforms will ensure a fairer and more transparent home-buying process. The government is working with provinces and territories, leveraging $5 billion from the Canada Housing Infrastructure Fund, to implement these protections. The plan includes measures such as shielding Canadians from renovictions, regulating blind bidding, standardizing lease agreements, and improving access to sales price history, all to ensure a fairer housing market across the country.
