Ontario Construction News staff writer
With housing starts expected to drop and prices expected to rise this year, the federal government’s budget fails people seeking affordable housing, and especially those looking to buy their first home, says Richard Lyall, president of the Residential Construction Council of Ontario (RESCON).
“There is no relief for first-time buyers who have been pushed out of the market,” Lyall said. “They are being taxed on new housing at rates which would have crushed their parents and grandparents.
“Housing is a vital need and we are taxing it like alcohol and cigarettes. The cost of housing used to be three times the average household income but now it’s 10 times.”
The average Canadian home costs $741,000 and the minimum income required to qualify for a mortgage is $195,000.
“Disturbingly, incomes have not kept pace with the increased cost of buying a home,” Lyall said. “Seventy-six per cent of people hoping to buy a home can’t afford to buy and live in what is being built.
The Federal budget tabled this week includes $52.9 billion in new spending over five years, including $8.5 billion for housing.
Before releasing the budget, the government introduced the Canada Housing Plan — a strategy Finance Minister Chrystia Freeland says will “unlock” nearly 3.9 million homes by 2031, with the following:
- $1.1 billion over ten years to transform 50 per cent of the federal office portfolio into housing.
- Utilizing 1,700-plus Canada Post offices across the country to build new homes while maintaining postal services, including six properties in Quebec, Alberta and British Columbia for development “as a start”.
- Consider redeveloping properties and buildings on National Defence lands for military and civilian use.
- $15 billion top-up to the Apartment Construction Loan Program.
The federal government will also consider vacant land that could be used to build homes and will hold consultations before implementing a new tax on residentially zoned vacant land.
“The government’s failure to take solid steps to help first-time homebuyers is short-sighted and self-defeating in terms of meeting the challenge of the housing affordability and supply crisis,” Lyall said. “To ensure the health of our economy, we must do more to help these homebuyers get a foothold in the market.
“The budget missed the mark on that front. We must help young Canadians who want to buy their first home. They are the future of this country.”