Aimed at helping people buy their first home, the federal government has announced mortgage reforms that mark the most significant changes in decades.
A key part of the reforms is the expansion of 30-year amortization periods, which will now be available to all first-time homebuyers and anyone purchasing a new home. In a press release, Ottawa said the extension is designed to lower monthly payments, making homeownership more accessible at a time when housing costs continue to rise.
Deputy Prime Minister and Minister of Finance Chrystia Freeland announced the changes, which will take effect by December 15, 2024. These reforms also include raising the cap for insured mortgages from $1 million to $1.5 million to reflect current market conditions. She said this adjustment, the first since 2012, will help more Canadians qualify for mortgages with a down payment of less than 20%.
“Starting today, Canadians can begin preparing their mortgage applications to take advantage of these changes by December,” Freeland said. “We’re ensuring that more people can access lower monthly payments and make the dream of homeownership a reality.”
The government’s focus on first-time buyers also includes measures aimed at boosting new housing construction, including condos, to tackle Canada’s housing shortage. Housing Minister Sean Fraser emphasized the importance of these measures in easing the burden for first-time buyers. “By lowering both down payments and monthly costs, we’re making it easier for Canadians to secure a home they can call their own,” Fraser said.
Through the Canada Housing Infrastructure Fund, $6 billion will be allocated to upgrade essential infrastructure such as water, stormwater, and solid waste systems. An additional $1 billion in federal funding will be available to municipalities for urgent infrastructure projects, with applications set to open next month.
