MIL OSI Translation. Canadian French to English –
Source: Government of Canada – in French
Press release
September 24, 2024 – Ottawa, Ontario – Department of Finance Canada
Canadians work hard to afford a home. However, the high cost of mortgage payments is a barrier to home ownership, especially for millennials and Generation Z. To help more people, especially young people, become first-time homebuyers, the federal government announced the boldest mortgage reforms in decades on September 16.
The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance, today announced technical guidance for lenders and insurers to ensure Canadians can benefit from these mortgage reforms starting December 15, 2024:
Increasing the price cap for insured mortgages from $1 million to $1.5 million to reflect current housing market realities and help more people qualify for a mortgage with a down payment of less than 20 per cent. Increasing the insured mortgage cap, which has not been adjusted since 2012, to $1.5 million will help more people afford their own home. Expanding eligibility for the 30-year mortgage amortization to all first-time and newly constructed home buyers to reduce the cost of monthly mortgage payments and help more Canadians afford their own home. By helping people afford new homes, including condominiums, the government is announcing a new measure that will encourage new housing construction and address the housing shortage. This measure builds on the commitment made in Budget 2024, effective August 1, 2024, to provide 30-year mortgage amortization for first-time buyers of newly constructed properties, including condominiums.
These measures, which represent the most significant mortgage reforms in decades, are part of the federal government’s plan to build 4 million new homes to help more people become homeowners. It is the most ambitious plan in Canadian history.
Along with the 4 million additional homes we are building, communities need help building other infrastructure. That is why the federal government is investing $6 billion through the Canada Housing Infrastructure Fund to help communities expand and improve their infrastructure. This includes clean water, wastewater, stormwater and solid waste management infrastructure. The government has begun negotiations with provinces and territories on key actions they can take to increase housing supply, in exchange for a share of the $5 billion in federal funding. For urgent municipal infrastructure priorities, applications for the $1 billion municipal component will begin next month.
Quotes
“To build on our momentum to help Canadians save for a down payment, last week we announced the boldest mortgage reforms in decades. Today, we are providing the technical guidance banks need to offer first-time home buyers lower mortgage payments. Talk to your financial institution today to get your first mortgage application ready by December 15.”
– The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance
“Everyone deserves a safe and affordable place to call home. By reducing both the down payment and monthly mortgage costs, we are taking the boldest step yet for Canadians looking to buy their first home.”
– The Honourable Sean Fraser, Minister of Housing, Infrastructure and Communities
Quick Facts
ThereCanadian enhanced mortgage charter, presented in Budget 2024, sets out expectations for financial institutions to ensure that people who are having difficulty making their mortgage payments have access to tailored relief and to facilitate the purchase of a first home.
Mortgage loan insurance allows people to get a mortgage for up to 95% of the purchase price of a property, and ensures they get a reasonable interest rate, even with a smaller down payment.
The government’s housing plan – the most ambitious in the country’s history – will build nearly 4 million additional homes to make housing more affordable in Canada. To help more people make a down payment, recognizing that the size of a down payment and the time it takes to save are now too large, the federal government has:
Launching the Tax-Free Savings Account for First-Time Home Buyers, which allows individuals to contribute up to $8,000 per year, up to a cumulative maximum of $40,000 for their first down payment. No taxes on contributions or withdrawals; Increasing the Home Buyers’ Plan limit from $35,000 to $60,000, as announced in Budget 2024. This measure allows first-time home buyers to use the tax benefits of Registered Retirement Savings Plan (RRSP) contributions to save up to $25,000 more for their down payment. The Home Buyers’ Plan allows Canadians to withdraw money from their RRSPs to buy or build a home. It can be used in conjunction with savings through the Tax-Free Savings Account for the purchase of a first property.
Last week, the government also released plans for a tenants’ bill of rights and a property buyers’ bill of rightsThese will protect tenants from unfair practices, simplify leases and increase transparency of rental amounts, in addition to helping to make the property buying process fairer, more open and more transparent.
To end encampments and combat homelessness, The government announced on September 22, 2024, that an amount of $250 million will be provided to provinces and territories that agree to match this funding. This funding will leverage up to $500 million to provide more shelter spaces, transitional housing and services to help people living in encampments find housing.
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Contact persons
Media may contact:
Katherine CuplinskasDeputy Director of CommunicationsOffice of the Deputy Prime Minister and Minister of FinanceKatherine.Cuplinskas@fin.gc.ca
Media RelationsDepartment of Finance Canadamediare@fin.gc.ca613-369-4000
General Inquiries
Phone: 1-833-712-2292Teletypewriter: 613-369-3230Email:financepublic-financepublique@fin.gc.ca
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EDITOR’S NOTE: This article is a translation. Apologies should the grammar and/or sentence structure not be perfect.