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Bank of Canada Holds Rates Steady for the Second Consecutive Meeting–But Two More Rate Cuts Are Likely This Year
General Cedric Pelletier 4 Jun
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House Hunting Done Right: 5 Steps to Find Your Dream Home
General Cedric Pelletier 3 Jun
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GST cut for first-time buyers of homes under $1M
General Cedric Pelletier 30 May
Prime Minister says move will save Canadians up to $50,000 and boost housing supply amid affordability crisis
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Prime Minister Mark Carney is promising relief for first-time homebuyers by eliminating the GST on homes priced at $1 million or less.
The new measure, unveiled in Edmonton just days before the expected launch of the federal election campaign, would save buyers as much as $50,000, Carney said. It also aims to stimulate new housing construction across Canada by lowering upfront costs and encouraging builders to bring more supply to market.
“Canada is in a housing crisis—demand has gone up, supply has not kept pace, and prices are too high,” Carney said during the announcement. “Eliminating the GST will save first-time homebuyers up to $50,000 and spur housing construction across the country. We will announce a series of new measures to increase housing supply shortly. It’s time for focused action to solve the housing crisis, and it’s time to build a Canada you can afford.”
The promise delivers on a key plank of Carney’s leadership campaign and echoes a similar commitment made last fall by Conservative Leader Pierre Poilievre. With affordability issues dominating public concern, both major parties are racing to position themselves as the party best equipped to fix Canada’s broken housing system.
Under current federal rules, new homes priced under $350,000 are fully eligible for a GST rebate, with a partial rebate available up to $450,000. But with average home prices far exceeding that threshold in most major cities, many buyers—and builders—have effectively been shut out of the tax relief. Carney’s proposed GST exemption would apply to all first-time buyers purchasing a home up to $1 million, expanding the benefit to a broader group.
Housing affordability has become one of the defining challenges of the past decade, particularly for young Canadians and newcomers. According to the Canada Mortgage and Housing Corporation (CMHC), the country needs to build an additional 3.5 million homes by 2030 to restore affordability. But builders face headwinds from high interest rates, labour shortages and regulatory delays.
The federal government says it plans to unveil a suite of additional measures in the coming weeks to help address these barriers and accelerate construction. Carney has framed housing not only as a crisis of affordability but as an economic imperative.
“Our government is laser-focused on lowering costs for Canadians and making homeownership a reality,” the government said in a release. “The Government of Canada will confront the housing crisis head-on and build the strongest economy in the G7.”
Written by the CMT team
First-Time Homebuyer Benefits.
General Cedric Pelletier 26 May
Buying your first home is a significant milestone! While you’re thinking about your affordability and what type of home you want to own, we have some exciting updates around first-time homebuyer benefits:
New or Pre-Construction Homes: Did you know? First-time buyers looking to purchase a new build or pre-construction home are eligible for 30-year amortization. This mortgage commitment can allow you to have smaller monthly payments, versus a standard 25-year amortization.
Mortgage Default Insurance: The CMHC has recently made it so mortgage default insurance will cover up to $1.5 million homes (increased from $1 million), helping more Canadians qualify for insured mortgages.
The Home Buyers’ Plan (HBP): The Canadian government has a program known as the Home Buyers’ Plan (HBP), which is designed to allow first-time homeowners to withdraw up to $60,000 from RRSP to buy a home!
Purchasing with your spouse? You can access a total of $120,000 from your RRSP’s.
First Home Savings Account (FHSA): The First Home Savings Account (FHSA) is specifically designed to help first-time homebuyers save for their down payment without paying taxes on the interest earned on their savings. The maximum is $8,000 annually that you can add into this account to save, with a maximum of $40,000 lifetime contributions.
First-Time Buyer Exemption: First-time home buyers are eligible for an exemption, reducing the property transfer tax you pay. If the fair market value of the property is:
- $500,000 or less, you can claim an exemption amount equal to the full amount of property transfer tax.
- Over $500,000 but no more than $835,000, the exemption amount is $8,000.
- Over $835,000 and under $860,000 then the exemption amount is proportionally reduced up to $15,200.
Land Transfer Tax Rebates: First-time buyers in Ontario, British Columbia, Prince Edward Island, and the City of Toronto are able to claim land transfer tax rebates.
Reach out to a DLC Mortgage Expert today to learn more!
Six Home Upgrades That Will Make Spring Even Better.
General Cedric Pelletier 23 May
As the days get longer and your flowers begin to bloom, there’s no better time to transform your house into your dream home. If you want to unlock your home’s full potential, here are six renovations that can boost both your lifestyle and property value.
Kitchen Transformation
Imagine having a kitchen that not only looks beautiful but also fits your lifestyle perfectly. A kitchen transformation can elevate your home, making it a space where you love to spend time. Whether it’s adding more storage, updating your appliances, or replacing your countertops, now is the perfect time to create the kitchen you’ve always dreamed of. In Canada, a mid-sized kitchen renovation typically ranges from $25,000 to $40,000. An investment that enhances your daily life, as well as your home’s appeal. You deserve a space that works for you.
Roof Replacement
Over time, weather and wear can take a toll on your roof, leading to leaks and potential damage. Replacing your roof this spring restores your home’s safety, boosts its curb appeal, and improves overall efficiency. With modern materials and improved insulation, a new roof offers long-term protection from the elements while reducing the likelihood of future issues. In Canada, the cost to replace the roof on a mid-sized home ranges from $10,000 to $20,000, an investment that offers renewed security and peace of mind for years to come.
Backyard Refresh
Why not turn your backyard into a personal oasis this spring? Whether you’re adding a new deck, fresh landscaping, or an outdoor kitchen, even small changes can make a big difference. Depending on the scope of the project, a new deck may cost between$5,400-$15,000, landscaping updates typically range from, $5,000 to $15,000 and an outdoor kitchen typically starts around $10,000. Whatever your budget, a thoughtful backyard makeover can create a welcoming space to relax and enjoy meaningful moments with family and friends throughout the season.
Siding and Paint Renewal
A siding or paint renewal can really bring new life to your home’s exterior. If your paint is fading or your siding is starting to look worn, it’s not just about looks, it can also leave your home more vulnerable to the elements. Updating with fresh paint or modern siding doesn’t just protect your home but also gives it a clean, refreshed look that you’ll love coming home to. On average, the cost of siding replacement for a mid-sized home ranges from $14,000 to $30,000, depending on materials chosen. Similarly, exterior painting typically costs between $3,000 to $9,000. It’s a simple change that makes a significant difference, especially with spring right around the corner.
New Doors and Windows
Sometimes, we don’t realize how old or worn-out doors and windows can affect the look and feel of our home. Updating them can instantly brighten up your space. A new front door, which typically costs around $3,900 for supply and installation, can instantly refresh your entryway. Replacing outdated windows, with an average cost of $15,000 to $35,000, can also improve natural light and energy efficiency. It’s amazing how these simple changes can make your home feel brighter, warmer, and more welcoming.
New Air Conditioner
You might have noticed that your air conditioning unit isn’t performing as well as it used to, and it may be time to start thinking about a replacement. A modern, efficient air conditioner not only keeps your home at the perfect temperature but also ensures you can enjoy hot days without worrying about your system struggling. On average, replacing an air conditioner in a mid-sized Canadian home costs between$3,500 to $8,500, depending on the type of system and installation requirements.
Renovations can be expensive, and it’s common to feel overwhelmed by the long list of updates you’d like to prioritize. With the CHIP Reverse Mortgage by HomeEquity Bank, these dream projects can become a reality. If you’re 55 or older, you can unlock up to 55% of your home’s equity in tax-free cash, with no monthly mortgage payments required, giving you the funds to complete transformative renovations just in time for spring.
Contact your Dominion Lending Centres mortgage expert to learn more about how the CHIP Reverse Mortgage can help fund your renovations without affecting your savings or monthly budget.
*Please note that all the numbers listed above are estimates and have been sourced from numerous websites. These figures are approximate as they may vary depending on different factors including province, time, market conditions, as well as regulations or policies. *
Written by my DLC Marketing Team
Today’s Inflation Report Poses a Conundrum for the Bank of Canada
General Cedric Pelletier 20 May
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Understanding Mortgage Penalties
General Cedric Pelletier 15 May
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Liberal election win: What it means for Canada’s policies and economy
General Cedric Pelletier 2 May
With 168 seats—just shy of the 172 needed for a majority—the party will once again rely on support from the NDP or Bloc Québécois to advance its agenda.
While the result maintains the status quo in terms of party balance, the change in leadership is expected to bring notable shifts in fiscal and housing policy.
Fiscal stimulus and deficit outlook
The Liberal platform includes $77 billion in new fiscal stimulus over four years, funded by larger deficits.
According to Oxford Economics, the plan represents 2.5% of 2024 GDP, with spending focused on “increased defence spending, infrastructure projects, and new housing construction alongside personal and corporate tax cuts.”
The Parliamentary Budget Officer estimates the federal deficit will rise to $62.3 billion, or 2% of GDP, in 2025–26 under the Liberal plan. That compares to a baseline deficit of $46.8 billion, or 1.5% of GDP.
CIBC’s Avery Shenfeld notes that “deficits are likely to somewhat exceed what the Liberals suggested during the campaign,” particularly if economic growth underperforms.
“Odds of the deficit topping 2% of GDP are likely more material than an undershoot,” he wrote.
Economic outlook: Stimulus helps, but a recession still looms
Economists say the Liberals’ spending plans will give the economy a bit of a cushion—but not enough to avoid a mild recession. Both Oxford Economics and BMO expect the new fiscal stimulus to soften the blow from the global trade war, though not completely offset it.
According to Oxford, the measures would add about 0.2 percentage points to GDP growth next year and 0.6 points in 2026. “The economy would still experience a downturn beginning in Q2 of this year,” the firm said, “but the recession would be shallower and shorter.”
BMO’s Robert Kavcic put it this way: “Even after accounting for Canada’s retaliatory tariffs to raise $20 billion… the net new stimulus under the Liberal platform is +0.5% of GDP in FY25/26.”
Still, he warned there are risks. If the economy underperforms, “there is further downside risk to the fiscal outlook,” he said, particularly if growth comes in lower than expected.
Housing and mortgage-related policies
The Liberal platform included several housing-focused measures aimed at improving affordability and boosting supply.
One of the headline promises is to remove the GST on new homes under $1 million for first-time buyers—something that could help bring down costs for those entering the market
The party is also planning to unlock over $25 billion in financing to support new affordable housing builds across the country.
Other key measures include a 1% cut to the lowest federal income tax bracket and a rollback of the recent increase to the capital gains inclusion rate—a move that could benefit both homeowners and investors.
There’s cross-party support on many of these initiatives. “Most parties support the removal of GST from new homes, in some form,” noted BMO’s Robert Kavcic. He also pointed out that the Bloc and NDP both back large-scale infrastructure spending, with the NDP in particular pushing for more investment in public transit.
The Liberals are also planning a shift in carbon pricing, scrapping the consumer carbon tax while keeping a system in place for big emitters. They’re also proposing tariffs on imports from countries that don’t have similar climate policies.
Bank of Canada rate outlook and market response
With the Liberals planning a large dose of fiscal stimulus, economists say the Bank of Canada may take a more cautious approach to cutting interest rates.
As Oxford Economics put it, with government spending “doing most of the heavy lifting,” the central bank is likely to keep its policy rate steady—for now.
That said, rate cuts are still expected. BMO is forecasting 75 basis points of cuts by the end of the year, while markets are pricing in something closer to 50 basis points.
“The budget will be a factor in determining the depth of those cuts,” said BMO’s Benjamin Reitzes.
As for financial markets, the election result didn’t cause much of a stir. The Canadian dollar and government bond yields were largely unchanged. According to BMO, investors are more focused on what the upcoming federal budget will reveal, and how trade talks with the U.S. might unfold in the weeks ahead.
Written by the CMT Team
How an FHSA Can Help You Buy Your First Home Faster 🏡
General Cedric Pelletier 22 Apr
Who loves some tax saving and money back?
I wanted to share some valuable information about the First Home Savings Account (FHSA)—a new and powerful tool available to help first-time homebuyers save for a home more efficiently.
What is an FHSA?
The FHSA is a tax-advantaged savings account introduced by the Canadian government to help first-time homebuyers save for a down payment. It combines the best features of an RRSP and a TFSA:
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Contributions are tax-deductible (like an RRSP), which can reduce your income taxes.
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Withdrawals for your first home purchase are completely tax-free (like a TFSA).
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You can contribute up to $8,000 per year, with a lifetime limit of $40,000.
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Unused contribution room can be carried forward (up to $8,000/year), making it flexible and easy to catch up if needed.
Why Open and Maximize an FHSA?
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Tax Savings – Get a break on your income taxes now while saving for your future home.
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Faster Growth – Investments inside an FHSA grow tax-free, helping your money grow faster.
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Stack with RRSP – You can use both your FHSA and RRSP under the Home Buyers’ Plan for an even larger tax-free down payment.
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No Repayment Required – Unlike the RRSP Home Buyers’ Plan, withdrawals from an FHSA do not have to be repaid.
My Recommendation
If you’re eligible, opening an FHSA as soon as possible allows you to start accumulating contribution room and taking advantage of the tax benefits right away—even if you’re not buying for a few years.
If you’d like help setting one up or have questions about your next mortgage strategy, I’d be happy to walk you through the options.
Call me to connect and get on that home ownership journey 🙂
Tariffs Dampen Canada’s Spring Housing Season.
General Cedric Pelletier 16 Apr
Global Tariff Uncertainty Sidelines Buyers
Canadian existing home sales plunged last month as tariff concerns again mothballed home-buying intentions. Consumer confidence has fallen to rock-bottom levels as many fear the prospect of job losses and higher prices.
According to data released today by the Canadian Real Estate Association, existing home sales declined by 4.8% month-over-month. Along with declines in the three previous months, national home sales are now down 20% from their recent high recorded last November.
“Up until this point, declining home sales have mostly been about tariff uncertainty. Going forward, the Canadian housing space will also have to contend with the actual economic fallout. In short order we’ve gone from a slam dunk rebound year to treading water at best,” said Shaun Cathcart, CREA’s Senior Economist.
While the largest of these declines has been seen in Ontario and British Columbia, sales have been down over the last few months in all but a handful of small markets across the country.
On a non-seasonally adjusted basis, the overall Canadian sales total for March 2025 fell 9.3% year-over-year and was the lowest for that month since 2009.
New Listings
New supply moved up by 3% month-over-month in March. Combined with the decrease in sales, the national sales-to-new listings ratio fell to 45.9% compared to 49.7% in February. The March level for this measure of market balance is the lowest since February 2009. The long-term average for the national sales-to-new listings ratio is 54.9%, with readings between 45% and 65% generally consistent with balanced housing market conditions.
At the end of March 2025, 165,800 properties were listed for sale on all Canadian MLS® Systems, up 18.3% from a year earlier but still below the long-term average (around 174,000 listings) for this time of year.
“While the trend of falling monthly sales has been observed across Canada over the last few months, there are still many regions where sales are high, inventory is near record lows, and prices are rising,” said Valérie Paquin, newly installed Chair of CREA’s 2025-2026 Board of Directors. “There are also parts of the country with historically low sales and the highest inventory levels in a decade or more.”
At the end of March 2025, there were 5.1 months of inventory nationwide, the highest level since the early months of the pandemic. The long-term average for this measure is five months of inventory.
Home Prices
The National Composite MLS® Home Price Index (HPI) declined by 1% from February to March 2025, marking the largest month-over-month decrease since November 2023.
The renewed price softening was most notable in British Columbia and Ontario’s Greater Golden Horseshoe. Prices have continued to push higher across much of the Prairies, Quebec, and the East Coast.
The non-seasonally adjusted National Composite MLS® HPI was down 2.1% compared to March 2024.
The nonseasonally adjusted national average home price was $678,331 in March 2025, down 3.7% from March 2024.
Bottom Line
Before the tariff threats emerged, the housing market was poised for a strong rebound as the spring selling season approached.
Unfortunately, the situation has only deteriorated as business and consumer confidence have fallenen sharply. While the first-round effect of tariffs is higher prices as importers attempt to pass off the higher costs to consumers, second-round effects slow economic activity, reflecting layoffs and business and household belt-tightening.
The Bank of Canada will undoubtedly come to the rescue this year by further slashing interest rates. This is particularly important for Canada, where interest-rate sensitivity is far higher than in the US. But traders are betting that the odds of another 25 bps rate cut tomorrow are no better than even.
The economy is slowing, and inflation fell more than expected in March. Next month’s inflation data are also likely to improve, reflecting the elimination of the carbon tax. This keeps the possibility of an April rate cut open, but even if the Bank of Canada takes a pass this month, we estimate they will cut the overnight rate three more times this year, taking it down 300 bps from its peak last year. This will finally spur buyers off the sidelines, but the timing of this rebound is more uncertain than usual, given the chaos in the White House.
Writter by our Chief Economist, DR Sherry Cooper