A condo tower under construction is pictured in downtown Vancouver on February 9, 2020. Experts and advocates say budget measures aimed at putting housing within reach of more Canadians mark a step in the right direction, despite a few ham-fisted moves. THE CANADIAN PRESS/Darryl Dyck

A condo tower under construction is pictured in downtown Vancouver on February 9, 2020. Experts and advocates say budget measures aimed at putting housing within reach of more Canadians mark a step in the right direction, despite a few ham-fisted moves. THE CANADIAN PRESS/Darryl Dyck

Experts, advocates say federal budget is hit-and-miss on housing

Monday’s federal budget promises $2.4 billion over five years, beginning with nearly $1.8 billion this fiscal year, for affordable housing

Experts and advocates say countrywide government measures aimed at putting housing within reach of more Canadians mark a step in the right direction, despite a few misses and ham-fisted moves.

Monday’s federal budget promises $2.4 billion over five years, beginning with nearly $1.8 billion this fiscal year, for affordable housing and follows through on a pledge to tax foreigners who own vacant homes in Canada.

Leaders including Vancouver Mayor Kennedy Stewart and Toronto Regional Real Estate Board president Lisa Patel applauded the commitments for trying to tackle affordability as real estate prices skyrocket across the country.

But market-watchers like Tsur Somerville, a real estate expert at the University of British Columbia’s Sauder School of Business, cast doubt on whether a national tax for a price problem particular to certain regions and urban areas was appropriate.

“You kind of worry about a national program addressing a need that might be more localized,” he said, adding that cottage country and tourist hot spots such as Banff and Mont Tremblant could suffer as foreign buyers think twice about investing in Canada.

“They always try and do one-size-fits-all. But we have a very varied group of markets across the country, and they really have to take into account urban versus rural. A broad, sweeping policy could have unintended consequences,” said Don Kottick, CEO of Sotheby’s International Realty Canada.

Heftier personal savings, house-obsessed millennials and historically low interest rates during the COVID-19 pandemic have conspired to send residential prices soaring amid a dire shortage of units.

The average home-sale price in Canada rose 32 per cent year over year in March to a record $717,000, with sales activity up by more than three-quarters, according to the Canadian Real Estate Association.

“Governments really have to address the supply side. Residential construction really hasn’t kept pace with the population for decades now,” Kottick said.

Housing advocates welcomed the budget’s one-year, $1.5-billion extension of the popular Rapid Housing Initiative. The year-old program funds construction of modular homes and conversion of existing properties into residences, creating 4,500 units so far — 1,500 more than planned.

However, B.C. Non-Profit Housing Association CEO Jill Atkey was “profoundly disappointed” the 739-page document did not carve out an urban, rural and northern Indigenous housing strategy, first promised by the Liberal government in 2017.

“All indications were lining up to suggest that it would be in this year’s budget. So I think there’s a lot of the urban Indigenous community just feeling like this is yet another a slap in the face,” she said.

Atkey said that the budget’s $2.4-billion top-up to the Liberals’ 10-year, $70-billion national housing strategy was “not an insignificant new investment.”

“But when we get down into looking at the actual number of units or homes that can be built with that money — and understanding we’ve got a vast, vast country with significant housing needs — I don’t think anyone can say that what’s in this budget is going to help the government reach its own goal of ending homelessness.”

The Canada Mortgage and Housing Corp. has set its sights on ending homelessness by 2030.

An estimated 1.6 million Canadian households are considered in “core housing need,” meaning they live in places that are too expensive for them or are otherwise inadequate. The budget’s plan to build or repair 35,000 units in total — with the help of a reallocated $1.3 billion in existing funding for quicker use — makes only a small dent in that statistic.

“The national housing strategy, since it was launched in 2017, has always been back end-loaded. So moving some of that planned investment up and realizing it now is important because it takes four or five years to get affordable housing built on a project-by-project basis,” Atkey added.

About $26 billion of the $70-billion housing strategy, which aims to build up to 125,000 new units for low- and middle-income households by 2028, had been earmarked as of December.

Toronto city councillor and deputy mayor Ana Bailão commended the Trudeau government for the re-upped Rapid Housing Initiative, but said she hopes the federal housing agency will show some flexibility on its 12-month construction timelines and conversion criteria.

“There are parts of the city where we’re losing a large number of rooms in rooming houses that are being bought up,” she said, noting that properties already deemed residential do not fall within the guidelines, unlike hotels, for example.

In a little-noticed line item, the budget also targets transparency and money laundering in the housing market.

It allots $2.1 million over two years for the Industry Department to implement a beneficial ownership registry by 2025.

“Money laundering is a multibillion-dollar problem in Ontario’s housing market, crowding out hardworking families looking to achieve their dream of one day owning a home,” said David Oikle, president of the Ontario Real Estate Association, in a statement.

“A beneficial ownership registry would help stop the practice of criminals using shell companies to buy up homes, giving law enforcement and government an important tool to keep dirty money out of Canada’s housing market.”

With some of the weakest money-laundering laws among liberal democracies, Canada offers anonymity to investors and money launderers by allowing the real, or “beneficial,” owner to go undisclosed, similar to the Seychelles or British Virgin Islands.

An estimated $5 billion was laundered through B.C.’s real estate market in 2018, according to a report the next year by an expert panel led by former B.C. deputy attorney general Maureen Maloney.

As a result, B.C. launched its own beneficial ownership registry that came into force in November.

Like us on Facebook and follow us on Twitter.

Want to support local journalism? Make a donation here.

2021 Federal Budget

Just Posted

Email letters to the editor to editor@northislandgazette.com and we will publish online and in print.
LETTER: Port McNeill councillor responds to May 12 North Island Rising column

‘council raised residential taxes for no reason and I stand by that statement’

The seasonal Search and Rescue program will run between May to September. ( File photo/Canadian Coast Guard)
Coast Guard Inshore Rescue Program starting up next week

Teams have protocols in place to ensure COVID-19 safety

Shearwater is located in the Great Bear Rainforest on the West Coast of B.C. (Cariboo Chilcotin Coast Tourism Association photo)
Heiltsuk Nation buys historic Shearwater Resort and Marina

Chief Marilyn Slett said Heiltsuk Nation has always valued its relationship with the company

B.C. Centre for Disease Control data showing new cases by local health area for the week of May 2-8. (BCCDC image)
Vancouver Island COVID-19 local case counts the lowest they’ve been all year

On some areas of Island, more than 60 per cent of adults have received a vaccine dose

A nurse gets a swab ready to perform a test on a patient at a drive-in COVID-19 clinic in Montreal, on Wednesday, October 21, 2020. THE CANADIAN PRESS/Paul Chiasson
Island’s daily COVID-19 case count drops below 10 for just the second time in 2021

Province reports 8 new COVID-19 cases on Vancouver Island Wednesday

Daily confirmed COVID-19 cases reported to B.C. public health, seven-day rolling average in white, to May 12, 2021. (B.C. Centre for Disease Control)
B.C. preparing ‘Restart 2.0’ from COVID-19 as June approaches

Daily infections fall below 500 Friday, down to 387 in hospital

Sinikka Gay Elliott was reported missing on Salt Spring Island on Wednesday, May 12. (Courtesty Salt Spring RCMP)
MISSING: Salt Spring RCMP find woman’s car, still seek Island resident

Sinikka Gay Elliott is 5’3” with a slim build and dark brown short hair

A Saanich man received almost 10 years in Supreme Court in Courtenay for a shooting incident from 2018. Record file photo
Shooting incident on Island nets almost 10-year sentence

Saanich man was arrested without incident north of Courtenay in 2018

Bradley Priestap in an undated photo provided to the media some time in 2012 by the London Police Service.
Serial sex-offender acquitted of duct tape possession in B.C. provincial court

Ontario sex offender on long-term supervision order was found with one of many ‘rape kit’ items

Rich Coleman, who was responsible for the gaming file off and on from 2001 to 2013, was recalled after his initial testimony to the Cullen Commission last month. (Screenshot)
Coleman questioned over $460K transaction at River Rock during B.C. casinos inquiry

The longtime former Langley MLA was asked about 2011 interview on BC Almanac program

Steven Shearer, <em>Untitled. </em>(Dennis Ha/Courtesy of Steven Shearer)
Vancouver photographer’s billboards taken down after complaints about being ‘disturbing’

‘Context is everything’ when it comes to understanding these images, says visual art professor Catherine Heard

Trina Hunt's remains were found in the Hope area on March 29. Her family is asking the public to think back to the weekend prior to when she went missing. (Photo courtesy of IHIT.)
Cousin of missing woman found in Hope says she won’t have closure until death is solved

Trina Hunt’s family urges Hope residents to check dashcam, photos to help find her killer

Chief Public Health Officer Theresa Tam listens to a question during a news conference, in Ottawa. THE CANADIAN PRESS/Adrian Wyld
Restrictions will lift once 75% of Canadians get 1 shot and 20% are fully immunized, feds say

Federal health officials are laying out their vision of what life could look like after most Canadians are vaccinated against COVID-19

Most Read