Federal budget outlines changes to mortgage rules and housing financing

The federal government is proposing changes to mortgage insurance, rental housing financing and consumer banking as part of its 2026 budget.

The measures could give some homebuyers more mortgage options, make it easier to finance rental construction and change how banks deal with customers.

Not all the changes will happen right away. Some have start dates, while others still require legislation or consultation.

Changes to mortgage rules

One of the biggest mortgage-related items in the federal budget wasn’t about rates at all. Ottawa increased the price ceiling for insured mortgages from $1 million to $1.5 million, opening the door for more buyers in higher-priced markets to access insured financing and potentially lower borrowing costs

The change could give buyers with a down payment of 20 per cent or more access to additional mortgage products and potentially better interest rates.

The budget also proposes allowing 30-year amortizations when at least one borrower is a first-time homebuyer or the property is newly built.

Stretching payments over a longer period can lower monthly mortgage payments, but it also means paying more interest over time.

More financing for rental housing

Ottawa is also trying to tackle the rental housing shortage from the construction side.

Starting in 2027, builders of new triplexes and fourplexes could qualify for insured financing covering up to 90% of the completed value. The government is also expanding mortgage insurance for rental properties from a maximum of eight units to as many as 50 units. The goal is simple. Make it easier to finance and build more rental housing.

The budget also proposes extending the ban on foreign purchases of existing residential properties until January 1, 2029. Newly built homes would be exempt under rules still to be developed.

Changes for bank customers

The government wants to increase federal deposit insurance coverage from $100,000 to $250,000. Additional temporary protection is also proposed for certain large deposits, including proceeds from a home sale.

Banks could be required to provide an annual statement showing customers how much they paid in account fees.

Confused by all of the changes?

There have been a lot of changes over the last few weeks.  Interest rate increases, changes to amortization periods in the federal budget and more.  Now is the right time to have a conversation with an unbiased mortgage professional to determine how these changes will impact your mortgage. If you have any questions about your mortgage, get in touch with us at the Clinton Wilkins Mortgage Team! You can give us a call at (902) 482-2770 or contact us here.