Economists say housing measures introduced by the federal government in its fall economic statement will not be enough to solve affordability and supply challenges in Canada’s tight housing market.

“Unfortunately, it’s policy decisions by municipalities and provinces that have the potential of boosting supply. The federal government’s tools on that level are limited,” Jules Boudreau, senior economist at Mackenzie Investments, told in an emailed statement.

“The sentiment is appreciated, but the impact will be limited.”


The fall economic statement, unveiled on Tuesday in Ottawa, announced that cooperative housing corporations, which provide long-term rentals, will be eligible for the removal of GST on new rental housing, assuming other conditions have been met. 

Boudreau said cutting taxes on new developments is a “cheap way” for the government to incentivize the creation of supply. 

Other measures in the fall economic statement were aimed at increasing housing supply in Canada.

From 2025-26, the federal government pledged $1 billion over three years to build 7,000 new units of affordable housing, and $15 billion in loan funding to construct over 30,000 new rental units across the country over the same period.

Boudreau noted that such measures will take time to provide relief for Canadians.

“Loans for affordable housing will help at the margin, but the effect won’t be felt for years,” Boudreau said. 


RSM Canada economist Tu Nguyen said funding for construction projects, including purpose-built rentals, could help to improve housing supply and “ease the housing shortage,” but regulatory changes would create more impactful change.

“Federal spending alone is not enough to solve the housing puzzle. Regulation reform could be more effective in getting developers to build,” Nguyen said in an emailed statement.


Dream CEO Michael Cooper said in a written statement that the development company is pleased with the government's pledges on housing supply. 

“Dream is glad to see continued efforts in today’s fall economic statement from the federal government to support the development community in building much-needed rental housing in Canada, including the $15 billion announced today for low-cost financing for apartment construction, along with the removal of GST on new purpose-built rental construction,” he said. 

Dream recently committed to add 5,000 new purpose-built rental units across Canadian urban centers in response to the federal government’s move to waive federal GST on new purpose-built rental construction. 

Mortgage Professionals Canada (MPC) said it recognized mortgage affordability steps and supply-boosting steps included in the fiscal update, and also noted that a “mortgage charter” proposed in the fiscal update will “better protect mortgage holders at renewal.”

The professional group outlined other actions for the government could take to improve housing affordability, including “a return to 30-year amortization period for insured mortgages, and for eliminating the stress test “on all mortgage renewals, switches and transfers.” 

The group also called for allowing digital income verification in the mortgage industry, saying this would help reduce instances of fraud. The group also called for creating a permanent national housing roundtable. 

The Residential Construction Council of Ontario (RESCON) said Tuesday that measures in the fall economic statement were a “step in the right direction” toward improving the housing crisis, but said the government should do more. 

“Billion-dollar fixes are being proposed, but the housing supply crisis and affordability issue is a trillion-dollar problem, as noted by the CMHC,” RESCON president Richard Lyall said in the release. 

“We are encouraged that housing is a main focus of the feds but there are still many impediments that were not addressed such as the enormous infrastructure funding gap faced by municipalities that impedes new home construction. We need a Marshall plan-styled strategy with respect to the chronic housing supply shortfall.”