Building 500,000 homes annually within a decade an ‘ambitious’ target: housing minister
OTTAWA — Prime Minister Mark Carney promised months ago that his government would double Canada’s current rate of residential construction to reach 500,000 homes per year, but that target is “ambitious” according to Housing Minister Gregor Robertson.
At the House of Commons committee on finance on Monday, Robertson was being grilled on his government’s commitment by Conservative finance critic Jasraj Singh Hallan when he said that ramping up construction up to that level would not happen overnight.
“Canada is not building at that scale. That is a longer-term goal over a decade,” said Robertson, who served as mayor of Vancouver from 2008 to 2018. “That certainly will take many years to achieve, given the changes that need to be made in the industry.”
“At this point, we don’t have the labour force to manufacture at that scale,” he added.
According to Canada Mortgage and Housing Corporation (CMHC)’s latest numbers, the country saw 277,147 housing starts in September — a modest increase of 4.1 per cent over a six-month period driven by higher starts in Ontario, Quebec and the Prairie provinces.
Carney vowed in his housing plan to nearly double that amount on a yearly basis — over the next decade — in part thanks to its new entity called Build Canada Homes (BCH) which is meant to build affordable housing at scale for lower to middle-income Canadians.
The objectives are consistent with former prime minister Justin Trudeau’s pledge, ahead of the 2024 budget, to “unlock” 3.87 million new homes by 2031. That included a minimum of two million net new homes, on top of the CMHC’s forecast of 1.87 million homes by 2031.
When asked by Singh Hallan on Monday when would be the first year Canada would be able to build 500,000 homes, Robertson could not give a clear answer. He said it is “reasonable” to believe it could happen within 10 years, but it would still be a challenge.
“It’s still very aggressive and ambitious to get to 500,000 over the next decade, but that’s what we need to scale up to,” he said.
Robertson was on the hot seat as part of the House of Commons finance committee’s study on the government’s affordability bill, C-4, which aims to implement, among other things, a temporary GST rebate for first-time home buyers who are buying new builds.
The measure, the minister explained, would eliminate the GST on new homes up to $1 million and reduce the GST for new homes between $1 million and $1.5 million — which would help first-time home buyers save up to $50,000 on their first property.
Robertson said this rebate would apply to approximately 47,000 newly built homes annually and deliver as much as $3.9 billion in tax savings to Canadians over five years.
There are, however, some restrictions: first-time home buyers must be at least 18 years old and Canadian citizens or permanent residents. They will not be eligible if they have lived in a primary residence owned by themselves, their spouse or their common law partner.
But Conservatives have been arguing the Liberals’ GST rebate is a half-measure and instead suggested, in the last election, to axe the federal sales tax on all new homes up to $1.3 million — saving up to $65,000 — and not just to help first-time homebuyers.
“It wouldn’t help, for example, somebody who lost their house because of an affordability crisis. It wouldn’t help a young couple who have a condo who want to buy a house. It doesn’t apply to a senior who wants to downsize,” said Conservative MP Sandra Cobena.
But Liberals are arguing that their proposed GST rebate should be adopted to help developers sell their existing units and move onto building new homes.
Liberal MP Ryan Turnbull, who acts as parliamentary secretary to the minister of finance, mentioned there are many housing units under $1.5 million in his riding of Whitby, Ontario, that would qualify for the GST rebate but have been sitting on the housing market.
“We do have a glut of supply in Toronto, in the GTA market, and Vancouver as well. It would be good to see many of those homes sold to first-time home buyers in the near term,” replied Robertson.
Bloc Québécois MP Jean-Denis Garon asked if Robertson had advocated for more infrastructure funding in the upcoming budget for the municipalities that will see the housing supply swell in the coming years, arguing that provinces are strapped for cash.
“We can’t build new homes without the housing infrastructure,” said Robertson, while deflecting to Finance Minister François-Philippe Champagne for all budget-related questions. He is expected to table the document on Nov. 4.
National Post calevesque@postmedia.com
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