Boosting Canada’s Rental Housing Market One Tax Measure at a Time

Against a backdrop of mounting housing affordability and supply pressures, Canada’s rental housing market is undergoing significant change as governments look for ways to accelerate new development. A recent article published in Espace Magazine explores how tax policy has become a key lever in encouraging investment and supporting the construction of new purpose-built rental housing across the country.

In this article, Sarah Benammar, partner, highlights the principal federal tax measures introduced since 2023, including accelerated tax depreciation, a proposed exemption from the EIFEL rules, and the enhanced GST rebate for eligible rental housing projects. She explains that these measures are designed to improve project economics by strengthening cash flow, optimizing tax treatment, and easing financing constraints. Sarah also emphasizes that the value of these incentives depends heavily on careful planning, particularly with respect to corporate structuring and the specific eligibility requirements attached to each measure.

The article underscores that while these incentives are significant, their full impact can only be realized when they are built into a broader, well-considered strategy. For developers, institutional investors, and family office groups, a structured approach is essential to maximizing tax benefits, improving project performance, and responding effectively to growing housing demand.

Read the full article for a detailed overview of the measures and their implications.