Budget’s housing promises not enough to solve affordability, supply issues: advocates

Housing advocates are lamenting “missed opportunities” in last week’s federal budget, saying more effort will be needed to accelerate home construction and bring prices down.

The Liberal government’s 2025 budget tabled Nov. 4 — its first under Prime Minister Mark Carney — pledged to spend $25 billion on housing over the next five years. The budget noted Canada’s “steep housing supply gap,” with the Canada Mortgage and Housing Corp. estimating 430,000 to 480,000 new housing units are needed per year in the next decade in order to restore affordability to 2019 levels.

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That would represent around double the current pace of home construction across the country. Canadian Home Builders’ Association CEO Kevin Lee called it an “aspirational” target and said there’s still much that would need to change in order to achieve it, including when it comes to federal policy.

“My biggest question would be, ‘How are we going to truly support home ownership of all kinds?'” said Lee.

“It did come as a surprise that the picture that was painted of the housing market was quite rosy, which it really isn’t.”

Ottawa said last week it would “supercharge” the housing industry with an initial spend of $13 billion over five years toward Build Canada Homes, a federal agency announced by the Liberals in September that aims to build and finance more affordable homes.

But the budget said the agency would focus primarily on non-market housing, highlighting a commitment to tackle homelessness while also building deeply affordable community and co-op housing for low-income Canadians.

The government said it would also leverage public lands, offer flexible financial incentives and attract private interment to deliver more housing at scale.

Lee said that while it’s important to create more social housing, it represents less than one per cent of the total housing stock that gets built.

“We really need to focus on the big picture here and really get more going on home ownership,” he said.

“Build Canada Homes certainly isn’t going to do it all by itself.”

NerdWallet Canada spokesman Clay Jarvis said the budget was short on details on how Ottawa plans to incentivize private investment to catalyze housing supply growth. He said the budget seemed to put “an awful lot of housing eggs in the Build Canada Homes basket.”

“This seems to be the primary driver of all this potential building that we’ll see over the next few years, but if we don’t get buy-in from the private sector or municipalities, I don’t see how we’re going to end up creating all of these homes that the government is promising,” said Jarvis.

“I think we’re taking a big risk by concentrating all of our efforts on one initiative and doing pretty little elsewhere.”

Toronto real estate broker Cailey Heaps said many in the industry are hoping to see more collaboration between federal, provincial and municipal governments to help align conditions and remove barriers to home ownership.

She said changes to rules surrounding land transfer and home vacancy taxes, for instance, could spur more real estate activity, while high development charges are still holding back new housing starts.

“There were some missed opportunities in the federal budget as it relates to housing,” said Heaps, president of the Heaps Estrin Real Estate Team.

“Everything that the government does as it relates to housing needs to be more. There needs to be more collaborative conversations across all levels of government … because one is pushing the other and there’s not a collective effort.”

The federal government announced earlier this year it would eliminate the GST for first-time buyers on some homes, a measure included in last week’s budget. The relief applies to new builds up to $1 million, while Ottawa will also reduce the GST for first-time home buyers on new homes between $1 million and $1.5 million.

“The removal of the GST for first-time home buyers, which is currently before Parliament as part of Bill C-4, helps bring down the costs of a newly built home — immediately making the goal of home ownership a reality for more Canadians, especially young families,” the budget said.

But Lee said the measure doesn’t go far enough to help improve housing affordability.

He said the GST exemption should be extended to all buyers, not just those purchasing their first home, along with those renovating their properties to build secondary suites or accessory dwelling units.

Jarvis said the struggling condo market in regions like Toronto and Vancouver could also benefit from such relief. He worried the measure, as it stands, could amount to a “gift to developers.”

“It’s a lot of forcing first-timers to buy new builds,” he said. “We’re not really providing any help for buyers who want to buy resales.”

This report by The Canadian Press was first published Nov. 13, 2025.

Sammy Hudes, The Canadian Press