Federal budget to put major focus on housing affordability

Leaks ahead of Thursday’s federal budget suggest the government will be spending billions of dollars to help tackle the high cost of housing.

That reportedly includes a new law that would ban foreigners from buying Canadian houses and condos for the next two years.

A number of media outlets, citing senior government sources, are reporting Ottawa will sets aside $10 billion to deal with housing affordability over the next five years.

When it comes to the reported foreign ownership ban, CEO Michael Bourque with the Canadian Real Estate Association says the devil will be in the details.

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“What we don’t want is people or entities purchasing units of housing and leaving them empty as investment vehicles and taking housing from Canadians but, at the same time, we don’t want to discourage people from around the world coming to Canada, settling in Canada and purchasing property,” he tells CityNews.

“We don’t want to discourage people — Americans or others — who purchase vacation properties here. There are a number of communities in Canada that really rely on that for their economic well-being.”

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

Bourque would also like to see the federal government leverage infrastructure dollars to encourage municipalities to build more housing faster, to ease the supply crunch.

“It really needs to be across the spectrum of housing. We talk about the entry level, but there are many middle class Canadians who feel like housing is out of reach because prices have gone up so much. It’s been too difficult for too long for builders to build,” he says. “It takes a long time to get permits, to get zoning changes, to get a variety of approvals and it’s very costly. Developers have become very conservative.”

Bourque suggests that has helped push Canada into a severe housing shortage.

“The bulk of the population is now between the ages of 25 and 80, which are prime home-ownership years and we are not even close to keeping up with building new homes.”

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

“If a municipality wants money for transit, then it should be making new land available for new housing, they should be taking away restrictive zoning policies and they should be reducing other red tape to make it easier to build.”

The budget comes down at 1:00 p.m. PST/4:00 p.m. EST Thursday in Ottawa and is also expected to include billions for increased defence spending, dental care and pharmacare.