New measures have been set to help Canadians enter the housing market in the recommendations put forward by the new federal budget today.

There are rumors that this will include a new law that would limit foreign buyers from purchasing Canadian real estate.

The Canadian Real Estate Association says steps against foreign ownership could have very impactful results on the real estate market.

Leaks before the release of the final federal budget memorandum today indicate that the government will spend billions of dollars to help address the rising cost of housing.

It is said to include a new law that would ban foreigners from buying private Canadian houses and apartments for the next two years.

Several media outlets, quoting senior government sources, reported that Ottawa will allocate $10 billion to deal with housing affordability over the next five years.

Regarding the reported foreign ownership ban law, CEO Michael Bourke of the Canadian Real Estate Association says 

"What we don't want is for individuals or entities to buy residential units and leave them empty as investment means and take homes away from Canadians, but at the same time, we do not want to discourage people from all over the world from coming to Canada, settling in Canada, and buying property."

"We do not want to discourage the enthusiasm of people - Americans or others - who buy properties for vacations here. There are a number of communities in Canada that really depend on that for their economic well-being."

The proposed new law reportedly will include exemptions for permanent residents, foreign workers, and students.

Bourke also would like to see the federal government use infrastructure dollars to encourage municipalities to build more housing faster, to ease the supply crisis.

"You really need to have an available stock of housing. We are talking about entry-level, but there are many middle-class Canadians who feel that housing is out of reach because prices have risen so much. It has been very difficult for a very long time for construction companies." "It takes a long time to get permits, make zoning changes, and get approvals, and it is very costly. Developers have become very conservative."

Bourke says this has helped create a severe shortage of housing in the Canadian market.

"The majority of the population is now between 25 and 80 years old, which are the main homeownership years, and we are not even close to keeping up with building new homes."

He would like to see the federal government use its infrastructure funding to encourage more new construction.

"If a municipality wants to get this money to make a fundamental transformation in how things are done, it must make new land available for new housing, get rid of restrictive zoning policies, and reduce other routine procedures to facilitate the building process."

Spending in the new budget is also expected to include increased spending on defense, dental care, and pharmacy.

Edited by: Dima Abu Khair