On April 12, 2024, the federal government released Solving the Housing Crisis: Canada’s Housing Plan, which aims to help solve the housing crisis.
The plan, which is a significant part of the 2024 budget, features various measures to help address housing affordability through investments in programs that will increase housing supply, protect renters, and more.
“This plan acknowledges the diverse needs of Canadians, including Indigenous people, racialized communities, newcomers, seniors, persons with disabilities, those fleeing gender-based violence, Canadians across the income spectrum, and those who live in rural and remote communities. For many, the housing crisis is decades old, and linked to a history of marginalization and systemic discrimination. We are committed to building a Canada we can be proud of, where everyone has a place to call home,” reads the Government of Canada’s website.
In an effort to build more homes in Canada, the government will be introducing an accelerated capital cost allowance for apartments, expand the removal of federal taxes (GST) for rental housing, increase the annual limit for Canada mortgage bonds, provide low-cost loans to build apartments for the middle-class and more.
To build home faster, the government will help municipalities legalize housing and streamline approvals and attach housing conditions on public transit funding, among other actions.
The plan also aims to protect renters by creating a new Canadian Renters’ Bill of Rights, help Canadians purchase their first homes and increase the supply of affordable housing in Canada.
Following the announcement of the housing plan, the Canadian Real Estate Association (CREA) is applauding the Federal Government’s approach to tackling Canada’s housing crisis.
“Canada’s housing challenges have been building over many years and no one group can tackle it on their own,” said Janice Myers, CREA CEO. “Realtors across Canada have been advocating for a collaborative, multi-faceted approach for years. We’re ready to play our part.”
“We know many younger Canadians feel a lack of hope about their housing outcomes,” added Myers. “The dream of homeownership is alive, it’s just out of reach.”
While the Residential Construction Council of Ontario (RESCON) is also pleased that the plan contains measures that will help boost purpose-built rental housing, it noted that first-time homebuyers are still left out of the market.
“By providing meaningful incentives to home builders to depreciate the capital costs of new rental buildings this initiative will support more homes being built across Canada,” said RESCON president Richard Lyall. “Over the years, we have failed to produce enough purpose-built rental housing and are now paying the price for that.
“However, if we are to resurrect the prime minister’s dream of young people being able to afford a home, concerted action must also be taken to help first-time homebuyers who are struggling to put together funds to own a home. The announcement is a positive move for rental housing, but the federal government must do more for people who want to buy their first home.”
In response to the plan, the Canadian Home Builders’ Association (CHBA) said it looks forward to further engaging with the government to refine the plan as its actions come to fruition. “CHBA has prioritized a return to 30-year amortization periods for first-time buyers for insured mortgages in its recommendations, as tight mortgage rules have been a major driver in falling homeownership rates. This measure is a game-changer for those who have been struggling with housing affordability and growing inequities in mortgage access,” said CHBA CEO Kevin Lee.
“This measure will avoid price escalation in the existing housing market while going a long way to enable our sector to respond to the government’s goal of getting 5.8 million new homes built over the next decade. It will allow more first-time buyers to enter the market and create the necessary conditions for increased housing starts because, quite simply, if buyers cannot get a mortgage to buy a home, then builders cannot build.”
The plan will aim to build more homes by bringing down construction costs and getting cities to allow more homes to be built, make it easier to rent or own a home and ensure every renter or homeowner can retain their home, and help Canadians who can’t afford a home by working to end chronic homelessness in Canada, and building more affordable housing for students and seniors.
