As Canadians head to the polls for the federal election, one economist says that while all major parties are moving in the right direction to address a housing crisis, none have the tools to completely solve the issue.
With Canadians casting their ballots on Monday, the election occurred alongside various issues including tariffs and affordability. Additionally, all major federal parties are campaigning on strategies to make the housing market more accessible.
Mike Moffatt, a senior director of policy and innovation at the Smart Prosperity Institute, said in an interview with BNN Bloomberg Monday that some of the main strategies include a promise from the Conservates to eliminate GST on newly built homes under a $1.3 million price point. In contrast Moffatt said the Liberals are proposing bringing back the multi-unit rental building program (MURB), which offers tax breaks to builders on taxable income in the first few years a building is leasing units.
“So, there are some good policies there. I don’t think any of the parties are going to have enough to solve the crisis, but they are moving in the right direction,” Moffatt said.
The Liberal housing platform includes a plan to double the pace of homebuilding, constructing 500,000 units per year over the next decade. It also includes brining the federal government back into the business of building homes with a new agency named Build Canada Homes.
“Well, the federal government’s been doing this a little bit since 2017. Carney is suggesting he take it further and actually act as a developer and create a new crown corporation,” Moffatt said.
“It’s an ambitious plan, but I think a little bit of skepticism is warranted because it is so ambitious, creating a new crown corporation out of scratch to be a developer, it’s going to be a challenge for the government to pull off.”
Some of the issues hindering the federal government’s ability to address Canada’s housing crisis, according to Moffatt, are that it has no direct control over municipalities, and it can’t direct them to lower development charges, which he said all parties agree are “far too high.”
“What they can do is, create a bunch of incentive programs and try to incentivize municipalities to do the right thing, but they can’t force them to do it, and there’s always challenges around coming up with agreements and actually making sure that those municipalities live up to their word,” he said.
