ACT Chief Minister and Treasurer Andrew Barr will on Tuesday hand down his eighth territory budget, which will forecast a deficit for the next financial year.

It will also show the 2018-19 budget returned a $45 million surplus, far higher than the $1.5 million projected in February's mid-year budget update.

Mr Barr would not reveal the size of the deficit predicted for 2019-20, but told The Canberra Times it would be "there abouts" the $27.9 million projected in the mid-year update.

After the slight dip in 2019-20, the government is predicting the budget will surge back into the black, delivering surpluses of a combined $300 million in the next four years.

The predictions are based on renewed optimism in Canberra's housing market, which has been on a slight downturn for more than six months. House prices recorded their first annual fall in March, while the number of first-home buyers securing loans has also plummeted.

Mr Barr predicted that the introduction of new ACT and Commonwealth first-home buyer schemes, an expected interest rate cut and looser bank lending restrictions would see the market "picking up pace" in 2020 and 2021. A surge in the real estate market would deliver extra stamp duty revenue to the government.

Mr Barr said faster than expected population growth, and a more diverse labor market, had strengthened the territory's economic position.

The rate of population growth has forced the territory to bring forward planned infrastructure spending, particularly on schools.

The budget will include money for a new school in Gungahlin, as well funding to expand schools which are at, or nearing, enrolment capacity. The Canberra Times understands schools in the inner north will be among those to be upgraded.

Mr Barr said the timing of the federal election meant the ACT government had to prepare a "red budget" - to be delivered if Labor won government - and a "blue budget" - which would rolled out if the Coalition was returned for a third term.

Labor's election loss meant the ACT missed out on $200 million in funding for the second stage of light rail.

The Bill Shorten-led party had also pledged to co-fund a number of smaller projects with the ACT government, including a $6 million indoor sports facility in Tuggeranong and $5.8 in upgrades to bike paths.

Mr Barr said the ACT government would fund "some" of the promised projects, but did not specify which ones. The timeline for their delivery would also likely be pushed back, he said.

The budget is also set to include more money towards planning for stage two of light rail.

"We remain optimistic about where the territory economy is heading - there is continued growth and more diversity - but it does need active government involvement," he said.