Accelerating the pace of homebuilding, addressing affordability issues, and handling Trump are just some of what mortgage brokers see as the new PM’s biggest tasks
After helping steer Canada’s economy through the worst of the global financial meltdown and softening the blow of Brexit in Britain, Mark Carney is gearing up for what could be his steepest hurdle yet: the task of solving a vast housing crisis in Canada while navigating a punishing trade war and repeated annexation threats from the US.
Carney’s challenge on the housing side is a daunting one. Property values and rental costs have skyrocketed during the past decade, far outstripping wage growth and pricing scores of Canadians out of the housing market – while the pace of homebuilding remains well below what Canada Mortgage and Housing Corporation (CMHC) says is needed to stop that problem becoming even worse.
Tackling Canada’s housing woes while managing the looming economic shock of US president Donald Trump’s tariff war will likely prove no easy feat, even for a veteran economist with a lengthy and high-profile track record in crisis management.
The ongoing trade chaos, which has seen Trump slap massive levies on Canadian imports and continually suggest Canada would be better off as part of the US, means few in the mortgage industry are expecting a quick fix from Carney when it comes to the housing crisis.
Tracy Valko (pictured top), founder at the Valko Financial brokerage, told Canadian Mortgage Professional she saw turbulence ahead for the mortgage market because of that trade war, and highlighted the tricky balancing act facing Carney on handling housing and tariffs in tandem.
“With US tariff risks and global economic pressures, mortgage rates may remain volatile,” she said. “The new government must balance affordability measures with fiscal discipline to avoid fuelling inflation or pushing bond yields higher, which would keep borrowing costs elevated.”
With Carney in power, all eyes turn to housing. JP Boutros says prefab support offers a quick win, but U.S. tensions may delay focus. https://t.co/Z520itpRVA
— Canadian Mortgage Professional Magazine (@CMPmagazine) April 30, 2025
What should Carney’s first steps on housing be?
Top of mind for the prime minister as he sets about putting his new administration together, Valko said, should be removing interprovincial trade barriers to lower construction costs and speed up housing supply, as well as expanding trade partnerships beyond the US, choosing reciprocal tariffs wisely, and focusing on targeted, non-inflationary support for homebuyers and renters.
Political unity will also prove essential, she added, even despite a divided parliament and the Liberals’ narrow failure to carve out a majority – a reality that keeps another election on the table much sooner than four years down the line.
“It will be challenging, given that it’s a minority government at this point for the next two years,” she said. “We need each party to work in unity to move our country forward in one of the most critical times in its history.”
The trade war and US-Canada relations unsurprisingly took centre stage during the election campaign, emerging as the top issue for plenty of voters – but tellingly, exit polls conducted for Global News for Ipsos showed younger Canadians were more likely to support the Conservatives because affordability and the rising cost of living were more important for them.
George Macris (pictured below), a Quebec-based broker with Dominion Lending Centres, told CMP that tariff fear had also been a constant theme during discussions with clients since the beginning of the year.
“Everyone has been focused on tariffs and on the Canadian election that just take place. Each and every phone consult leading up to the election had these two elements discussed,” he said.
“All clients either purchasing, renewing or refinancing were concerned about what is to come from the tariffs and from the future government. A lot of clients were uncertain where rates would be heading and how the mortgage landscape would look over the next few years.”
He said addressing and increasing supply should be Carney’s first focus on the housing file – by removing red tape and making it easier to build homes such as apartments and affordable housing.
Incentivizing construction and removing taxes off building materials to promote growth while simplifying the permit process to spur a faster pace of construction would also help, Macris said. “We have vast land in Canada that has yet to be developed.”
‘I feel people still voted for change, even if it wasn’t for another party’
Carney stepped into the role of prime minister after Justin Trudeau ended nearly a decade at the helm in January – but while Monday’s result sees the Liberals win a fourth consecutive election and stretch out their time in power, a Vancouver broker who preferred to remain anonymous told CMP she believed change was still on the way.
“While we still have a Liberal government, albeit a minority Liberal government, I feel people still voted for change even if it wasn’t for another party,” she said. “Carney is a different breed than Trudeau – and Canadians have placed their trust in Carney to lead the fight against Trump and build a better, more cohesive Canada.
“Carney is a numbers guy – and I hope he brings stability and a sense of calm to the markets to allow consumer confidence to rebuild and get back on track.”
She urged the new government to prioritize homebuilding and exert pressure to reduce time delays and costs to build units in British Columbia. Unsurprisingly, though, the trade war continues to loom large in the eyes of many brokers as they look to the future. “I just wish there was a majority. As a minority government, it’s always a bit tougher,” she said.
“I hope that Carney can draw on his European relationships to help us join together with other nations to fight the wrath of Trump.”
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