Latest news with #CanadaHousing
Globe and Mail
26-05-2025
- Business
- Globe and Mail
Carney's plan to build Canada out of the housing crisis
Canada is facing tariffs, a possible recession and an ongoing housing crisis. The country needs millions of new, affordable homes, and Prime Minister Mark Carney wants the federal government to help build them. But how effective was it the last time the federal government built housing? Today, Dr. Carolyn Whitzman, a senior housing researcher with the University of Toronto, will walk us through the postwar plan Carney is drawing inspiration from. And then, we'll analyze the challenges Carney and Housing Minister Gregor Robertson will face, and whether their plan can solve Canada's long-standing housing crisis. Questions? Comments? Ideas? Email us at thedecibel@
Globe and Mail
15-05-2025
- Business
- Globe and Mail
Annual pace of housing starts in Canada up 30% in April from March
Canada Mortgage and Housing Corp. says the annual pace of housing starts in April rose 30 per cent compared with March. The national housing agency says the seasonally adjusted annual rate of housing starts for April was 278,606 units, up from 214,205 in March. The annual pace of urban housing starts rose 28 per cent in April to 259,788 compared with 202,668 units in March. CMHC says actual urban housing starts in April were up 17 per cent year-over-year at 21,720 compared with 18,539 in April 2024. The annual pace of rural starts was estimated at 18,818. The six-month moving average of the overall seasonally adjusted annual rate of housing starts was 240,905 in April, up 2.4 per cent.
Globe and Mail
12-05-2025
- Business
- Globe and Mail
Carney wants big government to get into housing – a major risk to taxpayers
Jake Fuss and Austin Thompson are analysts at the Fraser Institute. A trade war, U.S. President Donald Trump's threats to Canada's sovereignty, and global economic volatility loomed large in the recent federal election. Yet many voters remained focused on an issue much closer to home: housing affordability. In 2023, under then prime minister Justin Trudeau, Canada added a record high 1.2 million new residents – more than double the previous record set in 2019 – and another 951,000 new residents last year. All told, Canada's population has grown by about three million people since 2022, roughly matching the total population increase during the entire decade of the 1990s. Not surprisingly, home building has failed to keep pace. In fact, housing construction rates have barely exceeded 1970s levels, even though the population has more than tripled since then. The result has been a historic surge in housing costs. On the campaign trail for the recent election, the Liberals set an immigration target of about 400,000 per year, which is lower than the recent record highs but still high by historical standards, and tabled a plan that they claim will double Canada's residential construction rate to 500,000 new homes per year within a decade. But is it a good plan? And can the Liberals deliver it? First, the good news. To help boost private home building, the Carney government promised to introduce tax incentives, including a rental building allowance, which would help reduce the tax bill on new multiunit rental buildings, and a GST exemption for some first-time homebuyers, which may reduce the cost of newly built homes and spur more home building. The government also plans to expand the 'Housing Accelerator Fund,' which offers federal dollars to municipalities in exchange for more flexible municipal building rules, and to modernize the federal building code, which could shorten construction timelines. While much will depend on execution, these policies rightly aim to make it faster, cheaper and more attractive for the private sector to build homes. Now, the bad news. The Carney government plans to create a new federal entity called Build Canada Homes (BCH) to 'get the government back in the business of building.' According to Mr. Carney's vision, the BCH will act 'as a developer to build affordable housing' and provide more than $25-billion in financing to home builders and $10-billion in low-cost financing and capital for home builders to build 'affordable' homes. We've seen a similar movie before. In 2017, the Trudeau government created the Canada Infrastructure Bank (CIB) to invest in the 'next generation of infrastructure Canadians need.' Since then, the CIB has approved approximately $13.2-billion in investments across 76 projects, but as of July, 2024, only two CIB-funded projects had been completed, prompting the authors of a multiparty House of Commons committee report to recommend abolishing the CIB. The bureaucrats who will run the BCH won't have the private sector's expertise in housing development, nor the same incentives to keep costs down. BCH's mandate is already muddled by competing goals – it must deliver 'affordable' homes while simultaneously prioritizing certain building materials (e.g. Canadian softwood lumber), which could increase building costs. The plan for BCH's multibillion-dollar loan portfolio includes significant 'low cost' (that is, taxpayer subsidized) financing, a huge bet on prefabricated home building, and no certainty about who will be on the hook for any failed projects. Combined, this represents a major increase in costs and risks for taxpayers at a time when they already shoulder rising federal deficits and debt. There's also a real risk that BCH will simply divert limited investment dollars and construction resources away from private home building – where projects respond to the needs of Canadian homebuyers and renters – and toward government-backed housing projects shaped by political goals. Instead of boosting overall home building, BCH may simply reshuffle limited resources. And, as noted by the government, there's a severe shortage of skilled construction labour in Canada. It's hard to see how Mr. Carney's housing plan would double the pace of home building in Canada – a very ambitious target that would require not only prudent housing policies but greater domestic savings, an implausibly large expansion in the construction work force (which grew by only 18.4 per cent over the last decade), and the political fortitude to endure vocal opposition to housing development in certain neighbourhoods and on public lands. Canada's housing crisis will benefit from federal leadership – but not federal overreach. Rather than overpromising what it can't deliver, the Carney government should refocus on what it's best positioned to do: reform incentives, streamline regulations and nudge municipalities and provinces to remove constraints on home building. Trying to also act as a housing developer and lender is a far riskier approach.
National Post
09-05-2025
- Business
- National Post
Looking to buy a house in Canada amid trade war? What RBC report is telling us about the real estate market
Article content The ongoing trade war between the U.S. and Canada has cooled Canadian housing markets significantly. Anxiety over tariff uncertainty and a looming threat of recession have led to notable shifts in market activity and home prices across the country, according to a recently released special report on housing from RBC. Article content Home resales have dropped sharply, with March 2025 marking the third consecutive monthly decline. Nationally, resales were down an estimated 4 per cent from February and 15 per cent from December. In major markets like Toronto, resales in March were the lowest since 1998, dropping more than 30 per cent since the U.S. began its trade overhaul. In Vancouver, home resales have fallen 23 per cent year-to-date, says RBC. Article content The trade war has made potential buyers more reluctant due to concern about job security and the broader economy. Many are choosing to wait out the uncertainty, rather than make the significant financial commitment to buy a home. Article content Article content Despite that shift, new listings have increased. Toronto's listings are up 8.1 per cent, while sales in that market have dropped 23.3 per cent. This imbalance has led to increasing inventory and more competition among sellers. Article content In Toronto, the composite MLS Home Price Index fell by $35,000 (-3.2 per cent) over three months, with further declines expected. Vancouver's benchmark price has also slipped for three straight months and is now 0.6 per cent below its level from a year ago. Nationally, prices are expected to continue softening, especially in Ontario and British Columbia, according to BNN Bloomberg. Article content The regions in Canada most vulnerable to the trade war's effects on housing are those with economies heavily tied to cross-border trade, especially sectors targeted by U.S. tariffs. Article content The impact is most pronounced in southern Ontario, such as the cities of Toronto, Hamilton, Kitchener-Waterloo, Cambridge, Windsor, Brantford, Guelph, St. Catharines and Niagara Falls. The economies of these cities are deeply integrated with the U.S. via the automotive, steel, and manufacturing industries. Article content Article content The most intense retreats in housing activity and prices have been there, with Toronto experiencing its weakest sales in decades and other cities like Hamilton and Kitchener-Waterloo seeing notable price declines and surging inventories. Article content Calgary is a major energy and beef exporter, making it highly exposed to U.S. tariffs on these commodities. The city has seen a significant rise in listings and a drop in sales, with prices flattening and market balance shifting as a result of weaker demand.
