Federal Budget Pledges $13 Billion to Build Canada Homes as Rate Hike Cools Housing Market
Prime Minister Mark Carney’s Liberal government tabled its second federal budget on Nov. 5, allocating $13 billion in new capital to Build Canada Homes to construct 200,000 homes over the next decade. The budget also extends the foreign buyer ban to 2029, while a recent Bank of Canada rate hike has introduced uncertainty into the housing market.
Prime Minister Mark Carney’s Liberal government tabled its second federal budget on Nov. 5, pledging $13 billion in new capital over ten years to Build Canada Homes. The agency, which was launched in September 2025 to accelerate home construction, now holds a total capital of $45 billion. Through this investment, the government aims to build 200,000 new homes across Canada over the next decade.
The budget also includes funding to prepare land for development. Ottawa will spend $1.5 billion over four years starting in 2027-2028 to ready federal land for new housing projects, with an additional $387.4 million allocated in subsequent years for federal land readiness. Furthermore, legislation will be introduced to extend the ban on foreign residential property purchases until January 1, 2029.
These measures arrive amid shifting conditions in the housing market. The Bank of Canada raised its trendsetting interest rate last week, citing concerns about high oil prices. This increase has caused uncertainty for mortgage shoppers. According to National Bank of Canada data, less than 10 per cent of consumers chose variable rates in 2024. However, as of September, nearly half of consumers taking out or renewing a mortgage in 2026 had signed up for a variable rate.
Market activity in the Greater Toronto Area became quieter in the second half of October due to uncertainty regarding U.S. elections, tariffs, and interest rates. In other transactions, Derek and Jordanna Gibeault purchased a five-bedroom semi-detached home in Red Deer, Alta., for $330,000 in May 2023.
In Toronto's luxury market, Elena Stavreska and her husband moved from a King Street West penthouse to a house in Edenbridge, Etobicoke. The renovated house at 7 Colchester Court features a double-height living area with a ceiling height of 28 feet. The property includes an in-ground pool heated year-round and 5,500 square feet of heated patios, carrying an asking price of $6,745,000.
Beyond real estate transactions, studies suggest saunas can reduce stress, soothe sore muscles, relieve pain, improve heart health, and potentially lower dementia risk. Alan Jalasjaa serves as Canada’s Sauna Ambassador and hosts a sauna podcast.