New Mortgage Reforms Announced to Enhance Homeownership Access in Canada
On September 16, 2024, the Deputy Prime Minister and Minister of Finance, Chrystia Freeland, announced new mortgage reforms aimed at improving homeownership accessibility for Canadians, particularly targeting younger generations. The following key changes were highlighted:
- Increase in Insured Mortgage Cap: The price cap for insured mortgages will rise from $1 million to $1.5 million, effective December 15, 2024. This adjustment aims to help more Canadians qualify for mortgages with down payments below 20%.
- 30-Year Mortgage Amortizations: Eligibility for 30-year insured mortgage amortizations will be expanded to all first-time homebuyers and buyers of new builds, effective December 15, 2024. This change is intended to lower monthly mortgage payments and encourage new housing construction.
These reforms build on the Canadian Mortgage Charter, which allows insured mortgage holders to switch lenders at renewal without undergoing another mortgage stress test. The government claims these measures represent significant reforms in the mortgage sector and are part of a broader plan to construct nearly 4 million new homes across Canada.
Additionally, the government has introduced blueprints for a Renters’ Bill of Rights and a Home Buyers’ Bill of Rights, aimed at protecting the rights of renters and home buyers. These initiatives include measures to simplify leases and enhance price transparency in the housing market. The federal government is collaborating with provinces and territories to implement these changes, supported by a $5 billion fund for housing initiatives.
