The dust has settled after Canada’s federal election earlier this week, and as expected, the Liberal Party—now under the leadership of Prime Minister Mark Carney—has emerged with a minority government. While political transitions often spark uncertainty, the real estate community and broader markets reacted with remarkable calm. For Canadians concerned about housing affordability, interest rates, and economic stability, the election outcome offers both promise and caution.
So, what does this mean for the Canadian housing market moving forward? Let’s break down the key implications.
Housing Supply: Ambition Meets Execution
Housing was a dominant theme on the campaign trail, and for good reason. Affordability concerns continue to grip Canadians—especially younger generations trying to enter the market. The Liberals have pledged an aggressive housing agenda, including the creation of a Crown corporation focused on building affordable homes, eliminating the GST on homes under $1 million for first-time buyers, and fast-tracking permitting processes.
If these initiatives are executed effectively, they could significantly increase housing supply, which has been constrained by nearly two decades of under-building. Speeding up municipal approval times will be critical. In cities like Toronto and Vancouver, which are plagued by long development timelines, this could unlock long-awaited projects and gradually bring balance back to the market.
However, execution remains the biggest wildcard. With a minority government, the Liberals will need cooperation from other parties, adding complexity to already ambitious timelines. Moreover, land scarcity, rising construction costs, and labour shortages may temper how quickly new supply comes online.
Interest Rates and Fiscal Policy: What Buyers Should Watch
With the Canadian economy teetering on the edge of a downturn, the Liberals have proposed substantial fiscal stimulus—$225 billion in planned capital investment over four years. This spending will focus on housing, infrastructure, and clean energy, all of which could stimulate jobs and productivity without necessarily stoking inflation.
The Bank of Canada, for its part, is expected to remain cautious. A strong fiscal response could reduce pressure to cut interest rates further, meaning homebuyers hoping for a significant drop in borrowing costs may need to temper expectations in the short term. The real shift could come if fiscal measures successfully lift GDP growth without overheating the economy, potentially stabilizing rates at manageable levels for the housing market.
The U.S. Influence and Trade Disruption: A Subtle Threat to Affordability
While domestic policy dominated headlines, this election was significantly shaped by external pressures—especially from the U.S. The reintroduction of tariffs under the Trump administration has strained Canada-U.S. trade relations, creating ripple effects in pricing, supply chains, and consumer confidence.
For the housing market, this manifests in rising material costs, longer construction timelines, and potential inflationary pressures—all factors that could counteract the benefits of government-led housing initiatives. Investors and developers alike will be watching how Prime Minister Carney navigates diplomatic and economic tensions with Washington. Trade diversification, particularly toward the EU and Indo-Pacific nations, may offer a lifeline, but such pivots take time.
Immigration Policy: Balancing Demand and Supply
Immigration has long supported Canada’s economic growth, and it’s particularly vital for real estate. Newcomers drive demand, but the recent influx—especially of non-permanent residents—has contributed to housing shortages and pressure on public services. The Liberals plan to cap the non-permanent resident population below 5%, aiming to ease the strain while maintaining long-term workforce growth.
In the short term, this could stabilize rental markets in major cities. Over the long run, controlled immigration growth paired with increased housing supply could help rebalance demand and restore some affordability, particularly in urban centers.
What Should Buyers and Sellers Expect?
If you're considering buying or selling a home in Canada, especially in markets like Burlington, here’s what you should take away from this election:
Short-term affordability challenges may persist, especially while construction bottlenecks remain.
Increased government investment in housing could translate into more inventory in the next 2–5 years.
Interest rates are unlikely to fall dramatically, but they are expected to remain relatively stable, barring a severe downturn.
Tariffs and trade uncertainty could cause temporary price fluctuations in construction materials, indirectly affecting housing prices and renovation costs.
Immigration caps and infrastructure spending will impact local housing demand, especially in high-growth regions.
Final Thoughts
This election marks a turning point for Canada’s housing market. The promises are bold, the challenges are real, and the stakes are high. For Canadians, the hope is that this new government will deliver tangible results—not just headlines. Whether you’re a first-time buyer, an investor, or a homeowner thinking of selling, the months ahead will require attention, patience, and strategic decision-making.
If you’re curious how these changes might impact your specific real estate goals in Burlington or beyond, I’m always here to help you navigate this evolving market.
