How will the Liberal government impact the real estate market?

On election day, Canadians broke voting records to elect the Liberal Party of Canada as the new minority government led by Prime Minister Mark Carney. These elections will have crucial implications to the future of the Canadian real estate market.

The Liberal platform emphasized affordable housing — building more and incentivizing Canadians to purchase. Prime Minister Mark Carney has said, “In the face of President Trump’s tariffs, we need to build…so more Canadians can buy their first homes.”

Here are three key policies that will impact the condo market and broader real estate landscape:

1. No GST on homes under $1 million for first-time homebuyers (FTHB)
   The government is carrying over this policy from the previous administration in order to incentivize new homeownership. This aligns with what we’re seeing as a shift in condo ownership. A larger portion of preconstruction and new condos are being purchased by first-time homebuyers, as a worry-free and affordable alternative to detached homes in suburban areas. On average, FTHB can save $20,000 to $40,000 on a condo in the Waterloo Region through the no-GST policy.

2. Investing $15.3 billion in the Strategic Innovation Fund that helps create jobs
   New tech, AI, semiconductors, advanced manufacturing, and other similar industries will see a boost in government funding through the SIF. Fortunately, tech hubs like Kitchener-Waterloo will see the lift from this additional capital directly through job growth and indirectly through population growth and residual wealth. As people continue to move to the fastest growing region in Canada, we’ll see increased demands on the housing market.

3. Focusing on developing housing on Crown land
   In order to meet housing demands, the government has indicated a desire to build on public land, as well as introduce new low-cost financing for developers and builders. This will lead to a boost in housing development, however, the quality and location of the developments is still a question. Real estate investors will have an opportunity to choose between two types of developments: mass-produced prefabricated homes on the outskirts of cities, or well-designed, luxurious condos in the heart of a growing region.

Another consideration for investors and homeowners is the impact of potential tariffs on real estate development. While there is speculation of cost increases, the only guarantee is that buyers who purchase today will be shielded against the price increases of tomorrow.

While the government works to fulfill its promises, we’re optimistic that the policies will bring stability and confidence to buyers and investors. High-quality condo developments in fundamental markets like Kitchener-Waterloo will continue to see growth as additional factors such as supply and demand remain unchanged.