OTTAWA, ONT. – The Canadian Home Builders’ Association (CHBA) is praising federal party platforms for addressing housing affordability, stating the changes could help unlock homeownership for many more Canadians.
This month the Conservative Party announced a four-point plan to address housing affordability. It includes fixing the mortgage stress test to ensure that first-time homebuyers aren’t unnecessarily prevented from accessing mortgages and work with OSFI to remove the stress test from mortgage renewals to give homeowners more options.
Conservative Party Leader Andrew Scheer announced he would also increase amortization periods on insured mortgages to 30 years for first-time homebuyers to lower monthly payments, launch an inquiry into real estate money laundering, work with industry to end corrupt practices and make surplus federal real estate available for development.
“Measures such as fixing the mortgage stress test and increasing amortization periods on insured mortgages to 30 years for first-time homebuyers and making use of federal lands to increase housing supply are recommendations that CHBA has asked every federal party to adopt. We are glad to see that parties are listening,” said CHBA CEO Kevin Lee.
Other parties have also introduced measure to get more Canadians within reach of owning a home. The association has also welcomed the New Democratic Party of Canada’s promise to re-introduce 30-year terms to mortgages for entry-level homes for first-time buyers.
The association also supports shared equity mortgages such as the Liberal’s First-Time Home Buyer Incentive. According to Lee, while shared equity mortgages are appropriate for some as a complement to mortgage rule adjustments, modifying the stress test smartly and providing 30-year amortizations for well-qualified first-time buyers are the best approaches to unlock the door to homeownership without causing undue risk to the financial system.
Lee explained that the association has worked hard to help educate Canadians and government officials about the impact policy can have on affordability. The have polled Canadians and launched affordability.ca, a website designed to educate the public about housing affordability and dispel myths.
“These are important things to help us with our current situation and looking ahead, we really need more supply,” said Lee, regarding the platform announcements. “We just don’t have enough of the kind of housing people are looking for. There is broad stroke agreement that supply is a huge problem and we didn’t have that agreement a few years ago.”
Some of the next steps, said Lee, are to help more of the supply come online including cutting red tape in planning departments, educating communities that are opposed to development and decreasing some of the taxes and fees that buyers end up paying. This needs to happen at a provincial and municipal level, said Lee.
“Some of these restrictions prevent supply from coming online,” said Lee. “We need to take a hard look at those things and see how we can accelerate new supply. In some cases that is provincial, and a lot of times its local. Between the two, figuring out smarter ways to help development occur is really important.”
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