CMI Financial’s Kevin Fettig says new financing rules need matching action on zoning and approvals
Canada’s 2026 federal budget delivered the most ambitious set of housing finance reforms in a generation — but Kevin Fettig (pictured top), president of CMI Financial Group in Toronto, says the policies won’t translate into housing supply without faster, coordinated action from municipalities on zoning and approvals.
Tabled by the Carney government on November 5, Budget 2026 commits $45 billion to the Build Canada Homes (BCH) initiative.
The package expands construction loan-to-value ratios to 90% for triplexes and fourplexes from February 1, 2027, allows private insurers to compete with the Canada Mortgage and Housing Corporation (CMHC) on five-to-50-unit properties, and raises the optional insurance cap to $1.5 million for buyers with a 20% deposit in some of Canada’s most competitive markets.
Fettig welcomed the direction while cautioning against optimism outpacing execution.
“There’s promise here, especially for smaller developers who have struggled to access capital,” he told Canadian Mortgage Professional.
“But beyond financing, municipal approvals, zoning restrictions, and the availability of construction funding are all crucial to help move things forward. The government needs to make sure these policies work together to help revitalize a struggling real estate market.”
Missing middle financing needs zoning to follow
The 90% loan-to-value threshold for small multi-unit homes — the triplexes, fourplexes, and low-rise rentals that form the backbone of “missing middle” housing — opens financing options that have long been beyond reach for smaller builders in markets where municipal approval delays stretch two to three years or more.
“For smaller builders, access to construction loans of up to 90 per cent of projected completion value, without property value caps, could make more triplexes, fourplexes and low-rise rental projects viable,” Fettig noted.
“Municipalities now need to streamline zoning and approvals so builders can put that financing to work instead of waiting years to get started.”
The federal government has proposed an extension of the ban on non-resident foreign homebuyers for a further two years, but says it would exclude new residential properties from the policy. https://t.co/6KdPDC1AMh
— Canadian Mortgage Professional Magazine (@CMPmagazine) November 9, 2026
What the budget means for brokers
Fettig flagged the proposed Canada Revenue Agency (CRA) income verification pilot — a three-year, $13-million initiative set to begin testing in 2027-28 — as a fraud-prevention measure the broker industry has pressed Ottawa to deliver for years.
“The proposed CRA mortgage income verification service is long overdue, and it could give lenders another tool to detect fraud,” he said.
“For lenders like CMI, reliable income verification makes underwriting stronger.”
CMI has separately advocated for CMHC to introduce a mortgage-backed securities (MBS) pool to securitize insured construction loans, a move Fettig says would open a critical new funding channel for developers.
On insured mortgage rate transparency, Fettig underlined the broker’s irreplaceable role.
“A low rate is only part of the picture, particularly when insurance premiums are added to the mortgage and repaid with interest, prepayment penalties vary from lender-to-lender and upfront incentives can be clawed back on an early payout,” he explained.
“That’s where brokers come in, helping borrowers understand the full cost of a mortgage and choose one that fits their needs.”
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