Key takeaways
- Budget 2026 commits more than $2 billion to help up to 820,000 households switch to heat pumps, with rebates of up to $10,000.
- For applications from February 1, 2027, insured mortgages for building new three- and four-unit homes have no maximum property value and no owner-occupancy requirement.
- That financing allows loans of up to 90% of the projected completed value and up to 30-year amortization, and the announcement does not mention conversions.
- Budget 2026 does not introduce a new renovation tax credit, so the Multigenerational Home Renovation Tax Credit and Home Accessibility Tax Credit remain the main help.
- Ontario’s HST relief of up to $130,000 on new and substantially renovated homes still depends on starting by March 31, 2027.
Short answer: the federal Budget 2026, released on November 5, 2026, has three things that matter to GTA homeowners planning to renovate or build: more than $2 billion for heat pump rebates worth up to $10,000 per household; new insured mortgage financing for building three- and four-unit homes, with no maximum property value and no owner-occupancy requirement, for applications from February 1, 2027; and new rules to make insured mortgage rates easier to compare. It does not add a new renovation tax credit, so the existing credits remain the main tax help for a renovation.
This guide sets out what is in the budget for homeowners, what is not, and how it combines with programs already in place, including Ontario’s HST relief on new homes, which has a March 31, 2027 deadline. Figures come from the Department of Finance’s budget documents and related federal pages, checked on November 5, 2026. Budget measures often need legislation or regulations before they take effect, so watch for the final details.
1. Heat pumps: more than $2 billion
The budget commits more than $2 billion to help up to 820,000 households switch to heat pumps, and projects that the program will save households more than $1 billion a year on energy bills once fully implemented. The rebate it funds was announced in October:
- Up to $10,000 for low- to median-income households, and $2,000 for others
- Installations from November 1, 2026 may qualify, with applications opening in early 2027
- The heat pump must heat the whole home and be installed by an HVAC contractor, and the home does not need to be your primary residence
Our heat pump rebate guide explains how it combines with Ontario’s rebate of up to $7,500 and Toronto’s Home Energy Loan Program.
2. New financing for building three- and four-unit homes
Alongside the budget, the Department of Finance announced changes to mortgage insurance aimed at “missing middle” housing. For the construction of new three- and four-unit residential properties, and the purchase of newly built ones:
- No maximum property value
- No owner-occupancy requirement
- Loans of up to 90% of the projected value on completion
- Amortization of up to 30 years
- For applications submitted on or after February 1, 2027
This matters in Toronto, where zoning now allows multiplexes on residential lots. A homeowner or small builder replacing a single house with a three- or four-unit building could, in principle, finance far more of the project than before. The federal page describes this as applying to new construction and newly built properties; it does not mention converting or renovating an existing house, so do not assume a conversion qualifies. Ask your lender how the rules will apply to your project before you plan around them.
Our guides to Toronto’s multiplex rules and what a multiplex costs to build explain what can be built and what it costs.
The same announcement covers larger rental buildings of five to fifty units, with up to 90% loan-to-value and 50-year amortization for new construction. That is a developer product rather than a homeowner one.
3. Clearer insured mortgage rates
The budget says the government will introduce new regulations to make information on insured mortgage rates more publicly available, so borrowers can compare rates and find better ones. That should help anyone refinancing to fund a renovation, especially after the Bank of Canada’s rate increase on October 28. Our guide to interest rates and renovation financing explains what the increase means for HELOCs and refinancing.
What the budget does not include
Homeowners hoping for new renovation help will not find much beyond heat pumps. Budget 2026 does not introduce a new renovation tax credit or a new secondary suite program. The help that already exists continues:
- The Multigenerational Home Renovation Tax Credit, for creating a secondary unit for a senior or an adult with a disability, covers up to $50,000 of costs at 14% for 2026, worth up to $7,000.
- The Home Accessibility Tax Credit covers up to $20,000 of eligible accessibility work a year for people 65 and older or eligible for the disability tax credit, worth up to $2,800 for 2026.
- CMHC’s insured refinance for secondary suites allows up to 90% of the value after the work on homes under $2 million.
The deadline that matters more than the budget
For anyone building a new home or doing a gut renovation in Ontario, the most valuable relief is provincial, not federal. Ontario’s enhanced HST relief can cover up to $130,000 of HST on a new or substantially renovated home used as a principal residence, worth under $1.85 million, if the purchase agreement is signed, or the construction or substantial renovation begins, by March 31, 2027. Ontario has also announced that its $24,000 new housing rebate will end for deals and projects that start after that date. Our guide to Ontario’s HST relief explains who qualifies.
What to do now
- Replacing your heating? Installations from November 1, 2026 may qualify for the federal rebate. Keep every receipt.
- Thinking about a multiplex? Start design and zoning work now so you are ready when the new financing opens on February 1, 2027.
- Planning a custom home or gut renovation? Work backwards from March 31, 2027 for Ontario’s HST relief.
- Financing a renovation? Get a fixed, itemized quote and compare HELOC and refinance options before the Bank of Canada’s December 9 decision.
Turn the new programs into a plan
We design and build renovations, additions, multiplexes and custom homes across Toronto and the GTA, and we can help you time a project around the rebates and deadlines that apply to it. Book a free consultation.
Budget 2026 homeowner FAQs
Does Budget 2026 include a new renovation tax credit?
No. The main new measure for homeowners is more than $2 billion for heat pump rebates. Existing credits such as the Multigenerational Home Renovation Tax Credit and the Home Accessibility Tax Credit continue.
What is the new financing for three- and four-unit homes?
For applications from February 1, 2027, insured mortgages for building new three- and four-unit homes will have no maximum property value, no owner-occupancy requirement, loans of up to 90% of the projected completed value and up to 30-year amortization.
Can I use the new multiplex financing to convert my house?
The federal announcement describes it for new construction and newly built properties and does not mention conversions. Ask your lender how it will apply to your project.
How much is the federal heat pump rebate?
Up to $10,000 for low- to median-income households and $2,000 for others, for installations from November 1, 2026, with applications opening in early 2027.
Is there still HST relief on new homes in Ontario?
Yes. Ontario’s enhanced relief of up to $130,000 applies where the purchase agreement is signed, or construction or a substantial renovation begins, by March 31, 2027.