Housing experts are cautiously optimistic the latest federal budget will help make homes more affordable, but they say Ottawa will need to get the provinces on board.
Alex Hemingway, senior economist at B.C. Policy Solutions, praised the federal government’s stated goal of ending homelessness in the next decade.
He said there is real federal money behind the goal, with nearly $30 billion in proposed investments in transitional and supportive housing, mental health and addiction facilities and other supports.
That includes $5.5 billion to renew the Canada Housing Benefit, which provides rental assistance to low-income Canadians.
The federal budget also aims to triple non-market housing starts to 24,000 per year and proposes changes to mortgage insurance rules to encourage financing of smaller-scale developments.
But Hemingway said many of the federal proposals depend on provinces stepping up with their own operational funding and complimentary policies.
“There’s reason to believe that B.C. may be about to go backwards in terms of investments in affordable housing,” he said.
The incoming B.C. Conservative government has pledged to roll back many of the B.C. NDP government’s reforms aimed at boosting housing density.
Premier-elect Lorne Doerkson has said his government may repeal Bills 43 and 44. The legislation sets mandatory housing targets for municipalities and requires that municipalities allow small-scale, multi-unit housing on lots previously restricted to single-family homes.
Hemingway said repealing the bills would allow cities to put up roadblocks to new density housing.
“We have a B.C. Conservative government that’s talking about punching a multi-billion dollar hole in the budget with tax cuts,” he added. “I think all of that’s not adding up at this point, and it’s incumbent on this new government to come up with a plan that works to enable housing of all kinds.”
Housing and homelessness policy researcher Dr. Nick Falvo said he would give the federal budget an “A-minus” grade for its proposals to address homelessness.
While Falvo welcomed a proposed $10 billion toward the delivery of about 25,000 new supportive and transitional homes across Canada, he said he does not like that provinces and territories would be on the hook for long-term operating costs.
“This doesn’t necessarily have to be a 50/50 split, but there should be a good sharing of those long-term costs, because that’s the hard part,” said Falvo.
Andrey Pavlov, professor of finance at Simon Fraser University’s Beedie School of Business, said one of the most notable proposed measures in the federal budget is expanding access to 30-year insured mortgages.
The longer amortization would only be allowed for buyers of newly built units or first-time home buyers.
“I think that’s a pretty significant measure because it allows people to get into the market with lower initial payment,” said Pavlov.
He also welcomed changes exempting new construction and pre-sales from Canada’s foreign buyers ban, saying it would help developers secure initial financing.
But Pavlov said the proposed federal measures ultimately don’t address many of the barriers to new development, some of which are provincial policies.
He believes the B.C. Conservatives’ plans to roll back NDP housing policies could work in tandem with Ottawa’s proposed measures.
“If we actually remove all taxes and red tape that the previous [provincial] government introduced, I think that will open the door to much faster, to cheaper new housing in B.C.,” he said.
Speaking to reporters about the federal budget last Thursday, Doerkson said he was not yet ready to announce any specific commitments around housing.
“I know that Bill 44 and others have obviously conjured up much conversation and I’m committed to working with the municipalities to build more affordably in general terms,” said Doerkson.
