Federal budget 2023 – what’s in it for home buyers?
At a glance (3 minute read)
- The federal government is implementing a tax-free first home savings account, which will be offered by financial institutions to Canadians starting April 1, 2023.
- They're also planning on creating guidelines to protect mortgage holders, ensuring relief measures are provided by federally regulated financial institutions and protecting Canadians from unnecessary penalties and fees.
- Budget 2023 commits to building more affordable housing, investing in an urban, rural, and northern Indigenous housing strategy, and developing a Home Buyers' Bill of Rights to make buying a home more transparent and fair.
Launching the new tax-free first home savings account
Introduced in Budget 2022, this new registered plan allows qualifying home buyers to save up to $40,000 over five years, tax-free.
Budget 2023 announces financial institutions will start offering the tax-free first home savings account to Canadians as of April 1, 2023.
Mortgage lenders code of conduct
Through the Financial Consumer Agency of Canada, the government will publish a guideline to protect mortgage holders.
This will ensure that federally regulated financial institutions provide Canadians with relief measures including extending amortizations, adjusting payment schedules, or authorizing lump-sum payments.
Canadians will also be protected from unnecessary penalties, internal bank fees, or interest charges.
Building more affordable housing
Rising interest rates and construction costs have made it expensive to build housing. To ensure Canada’s National Housing Strategy programs can continue to deliver new affordable homes, Budget 2023 announces the government will reallocate funding from the National Housing Co-Investment Fund’s repair stream to its new construction stream to boost construction of new affordable homes.
The government also launched previously announced initiatives:
- a new $4 billion Housing Accelerator Fund to remove barriers and incentivize housing supply growth on March 17, 2023; and
- a $200 million stream under the Affordable Housing Innovation Fund to develop and scale up rent-to-own projects.
Investing in an urban, rural, and northern Indigenous housing strategy
Home Buyers’ Bill of Rights
The government will continue to work on a bill of rights to make buying a home more open, transparent, and fair.
In 2023, this could include ensuring the legal right to a home inspection, requiring that real estate agents disclose whether they are representing both sides of a potential sale, and ensuring transparency on the history of sale prices.
A housing market that works for Canadians
The government is concerned with the financialization of housing across Canada and commits to ensuring investor activity is helping, not hurting, housing affordability.
The government will review whether it needs to rebalance the housing market in favour of Canadians looking for a home to live in.
Floods
- $31.7 million over three years for a low-cost flood insurance program for high-risk households without adequate insurance.
- $15.3 million over three years for an online portal so Canadians can determine their flood risk.
- $48.1 million over five years to identify high-risk flood areas and improve the program used by provinces and territories to recoup the cost of natural disaster response.
More information
Read CREA’s release to boards and associations on Budget 2023.
Read the Budget 2023 news release.
Read the backgrounder: An affordable place to call home.
Read the Federal Budget 2023 (opens 270-page pdf).
If you have questions about the federal budget, contact Harriet Permut, manager of government relations at hpermut@rebgv.org.