How the New Liberal Government Could Impact Real Estate Prices in the GTA

With the 2025 Canadian federal election concluded and Mark Carney’s Liberal Party officially forming the government, attention has shifted from speculation to action. In regions like the Greater Toronto Area (GTA)—which includes Toronto, Hamilton, and Kitchener—housing affordability and supply continue to be pressing issues. The new government’s policies are expected to have a significant influence on the region's real estate landscape. This article explores what the Liberal victory means for the future of real estate in the GTA, outlines key initiatives already announced, and offers guidance for homebuyers and investors navigating this changing environment.

What's at Stake with the New Liberal Government?

Housing remains one of the most urgent challenges facing Canadians, and the GTA stands at the heart of the crisis. Rising prices, limited supply, and increasing demand continue to define the region’s market. Now, with the Liberal government in place, the question becomes: how will their housing strategy affect future prices and availability?

Housing Affordability: Still a Crisis

The GTA continues to see high property values and constrained inventory. As of March 2025, home sales declined by 2.4% seasonally adjusted, with the home price index falling by 1.4% to C$1,050,200, according to the Toronto Regional Real Estate Board (TRREB). Despite this short-term cooling, long-term affordability remains a concern, especially as population growth continues.

Liberal Housing Plan: What’s Coming

Under Prime Minister Mark Carney, the Liberal Party has already begun outlining an aggressive housing agenda, most notably the “Build Canada Homes” (BCH) initiative. The goal is to double annual housing completions across the country—targeting 500,000 units per year by 2030.

Key Liberal Actions:

• GST Rebate on New Rentals
   Aimed at encouraging developers to build more rental units by offering tax incentives.
• Using Federal Lands for Housing
   Opening up federally owned land in high-demand areas like Scarborough and York Region for residential development.
• Sustained Immigration Intake
   Continuing to welcome 500,000 newcomers annually to support economic growth—while also increasing housing demand.

Challenges Ahead:

Critics argue that the BCH initiative’s success will depend heavily on cooperation from provincial and municipal governments. Construction timelines, zoning delays, and labor shortages could hinder progress, especially in fast-growing urban areas like the GTA.

How Does the Conservative Opposition View Housing?

Although not forming the government, the Conservative Party—led by Pierre Poilievre—offered a contrasting approach centered on deregulation and accountability.

Their Key Proposals Included:

• “Fire the Gatekeepers” Strategy: Tying federal infrastructure funding to municipal performance on housing approvals.
• Temporary Immigration Cap: Reducing annual immigration to 400,000 until rental vacancy rates improve.
• Similar GST Rental Rebates: A shared focus on boosting rental supply.

While these won’t be enacted under the current government, they could still influence future political discussions and policy debates.

​​​​​​​Learning from the Past: What History Tells Us

Historically, Canadian federal elections have influenced housing markets—not just through policy, but through shifts in consumer sentiment. Pre-election periods tend to see uncertainty and slower activity, while post-election outcomes typically trigger market responses based on policy direction.

For instance, after the 2021 election, measures targeting foreign buyers altered buying patterns in major cities. Similarly, the 2025 Liberal win is expected to drive housing-focused policy shifts that could influence long-term price trends in the GTA.

What Should Homebuyers and Investors Do Now?

With a clear political direction set, now is the time for strategic planning based on real policy, not speculation.

For Homebuyers:

• Reassess Affordability: Consider the potential effects of upcoming housing supply increases and policy-driven interest rate changes.
• Follow Policy Updates: Keep track of how the “Build Canada Homes” initiative progresses in the GTA.
• Use Tools like Broko.ai: Leverage AI-powered platforms for tailored property insights and real-time market data.

For Investors:

• Focus on Growth Areas: Look at neighborhoods likely to benefit from new infrastructure and development projects.
• Understand Policy Impact: Evaluate how new regulations might affect rental yields, taxation, and appreciation.
• Diversify Smartly: Spread risk across property types or regions to protect your portfolio from volatility.

Conclusion

With the 2025 federal election behind us and the Liberal Party now in power, the focus has shifted from political campaigning to policy execution. Their housing strategy—if implemented effectively—could reshape the GTA real estate market over the coming years. Whether you're a first-time buyer or a seasoned investor, staying informed and adaptable is key. And with tools like Broko.ai, you can confidently navigate this evolving market landscape backed by data and insight.