First time home buyers will not be charged GST (5%) when buying a home, as long as the place they’re buying costs less than $1M. This means that people buying a home for the first time will save up to $50k on their purchase.
Edit: Note, GST is mostly only charged when buying newly built homes, so this won’t have any effect for people buying used homes.
We’re 3 million homes in the hole according to CMHC. Nobody is pretending we’re gonna get those built in the next five years. Along with building houses, increasing density, and reducing limitations on construction; we need to lower the cost of houses.
Like the Lemmite up thread says: tax unreasonable house gains, and disincentivize rentals.
We’re in a crisis, we can’t wait to build.
I’m 100% on board with solutions to help mitigate the short-term effects if we also start building now for the medium and longer terms.
The reason I was being prickly on this is that my home city and province (Vancouver) has been doing these feel-good things for years as a politically expedient distraction and excuse to not prioritize building.
So it scares me when people suggest these as the solution —and I’ll include Carneys announcement in with that same bucket. If folks suggest these as a stop-gap relief to the current situation and are also gonna build our way out? Alright I’m on board with that.
Yes. I think that’s a pretty universal sentiment. I don’t think I’ve seen anyone say that we should just do GST rebates - we want construction and immediate relief.
It’ll probably be a generation or so until the proportion of homes to people gets back to affordable territory. That’s not gonna help me, but hopefully it’ll help my kids.
In the meantime, we need to adjust other parts of government to get money out of housing: remove capital gains exemptions on housing, implement the anti-money laundering stuff BC has been asking for; do all the zoning crap; train people for the trades; import trades workers (with a path to citizenship); increase density; etc etc etc.
You’re correct that no one says that, but that seems to be what’s been happening. So I want the focus to be on the things that are going to deliver the actual results.
But maybe also I can get my head out of my own ass and not derail your enthusiasm for helping things in the here and now. So yeah, I’m with you. But let’s make those things a comma. I want my leaders at the federal, provincial, and municipal level to start moving the needle today, and stay focused in the months and years to come and ensure that the steps they are taking are the ones that are making meaningful improvements.
Awesome! Please email your MP and ask them to address the housing crisis. I typically send something along the lines of:
I’ve sent similar messages to my MP, MLA, and councillors over the past few years.
I have written my MP about this multiple times, signed a counter-petition against a movement to block a high rise in my building, and promoted the development with my neighbours. I’m also meeting my MP tomorrow and I won’t shut up about this, I promise.
And if they don’t move the needle I’m gonna vote the bastards out and support the next ones instead. I don’t care if it drops my house value — because my kids deserve to be able to afford to live.
I haven’t gone as far as meeting with my MP, but I ran a mailer site so people could mail their three levels of rep. It sent a lot of messages and got some feedback from officials, but it’s hard to know if any of them cared.
Meeting in person sounds more effective.
Same. I think there’s a lot of (potential) homeowners who feel that way.
Nice! By the way I wasn’t trying to win some dick measuring contest, when I say I’m going to meet him it’s more like I’m volunteering for the election and I’ll get maybe a few minutes at most in. I appreciate your activism, you fucking rock.
But housing has been my #1 issue and only recently dropped to #2 thanks to our need to defend our country and economy. However using BC lumber to build Canadian homes and apartment buildings instead of shipping it down south ties into that at least tangentially.
Another part to consider is how house sizes have gone up by a fair margin over the past 50 - 70 years. If you look at old bungalows built after the war they are 1000 - 1500 sqft homes, modern builds (around me at least) are all 2500+ sqft. So part of why homes are more expensive is that we’re building more home on each lot (just speaking on fully detached homes here).
A “starter home” isn’t really a thing anymore.
It seems like we have lots of single bedroom starter condos at 500-900 sqft, but I think those are designed to appeal to investors. 😬
I think a lot of people would be open to smaller homes/condos (1200 sqft) if they were affordable and nice.
Let’s imagine a world where an unapologetic socialist NDP leader stood up and said: “the market has failed to deliver homes at a price the median Canadian family can affords. So our govt will build homes across the country, employing Canadians and using Canadian products. These will not be luxury condos for the rich, but they will be functional and good, and will be made the wood and materials we used to send to America at a discount. And we will close the gap in 5 years, and deliver public monthly status reports on what we have accomplished.”
After the election, assuming Singh steps down, can we all agree to get someone who says something like that? Pretty please? Because I already got my wish with a perfect candidate to match my way of thinking, and I want you to be waiting in the wings if our way fails yet again.
What land is the government going to build all this housing on? Crown land? That’s mostly wilderness. Who wants to live out there?
Farmland? They’d have to buy it from farmers. Appropriating land from farmers is an extremely unpopular and regressive policy.
That leaves land in the city which is generally either occupied by houses or businesses already or it’s in the process of being developed but is caught up in regulatory hurdles or in various stages of construction. It’s actually a big problem that we don’t have enough skilled tradespeople to build houses at the speed we want them built.
The regulatory issues are a problem for municipal and provincial politics. The Canadian federal government doesn’t have any power to fix that stuff. The design of our federation gives most of the power to the provinces.
Let’s stop pretending these are unsolvable problems.
You’ve identified some real obstacles – a lack of tradespeople and opposition from local groups blocking. We need the federal government to work with the provinces to push them to do what we need to do, using the carrot or stick or a combination of the two.
Here’s how I would do it. Make designs for a small number of standard plans for buildings that are designed around the principles of efficient building. Across these sets of plans, you standardize building materials so that the parts can be sourced by a variety of Canadian suppliers using Canadian-sourced materials. Then work with the provinces to ensure that the homes meeting these specifications can be built anywhere it’s safe to do so – be it a quiet suburb of Vancouver who fights against any change to the “character of their neighbourhood” or a depressed town in rural Newfoundland or anywhere in between. If the provinces have conservatives who want to rely on the private sector, let the markets build em.
If the provinces are run by leftists, have the government build em. And yes, we need to train people to build. But this is where the standardization comes in – because we aren’t just building bespoke homes, we are implementing well-understood designs and can share in each others knowledge and experience as we build them. And with the economy in turmoil due to the American-led trade war, there will be people eager to be retrained.
We have the materials, we have the people, we have the money, and we have the will. What I’ve outlined is one path – and I have absolutely zero delusion that it’s the only possible path. Maybe someone smarter than me will come up with a better one, and well hey by sheer coincidence we just got a new PM who is in fact smarter than me.
The technical problems are likely the most solvable ones, except for the skilled trades shortage. That problem is very difficult to solve because most people don’t want to do the work and the people who don’t have any other options tend to have personal / mental health problems that make them very unreliable as workers.
I have several friends who work in the skilled trades (drywall taping and finishing). It’s extremely tiring work that leads to chronic joint pain later in life. You’re also exposed to large amounts of dust so you’re wearing a lot of PPE which is quite sweaty and uncomfortable. Many of the other people they encounter in the trade have severe problems with alcoholism, drug addiction, and are very unreliable as workers.
You might suggest that these trades should pay more in order to attract higher quality workers but that means the cost of building housing goes up even more! Ultimately, the problem for skilled trades is the Baumol effect. The labour productivity of construction work has not risen to match the productivity of other industries (notably the tech industry). This problem has affected many industries in our society. It’s the hidden cost we all pay for the convenience of technology.
The political problem is even more difficult to solve. The issue there is that the middle class has grown rich on the back of their home. The rise in real estate value for people’s single family houses has been the main contributor to the wealth of the middle class. Building on this, the two main political parties in Canada (Liberals and Conservatives) target the middle class as their voting base. Thus they are both extremely reluctant to do anything that would lower the demand for housing which would cause real estate prices to fall, destroying the wealth of their voting base.
Milton Friedman has called this problem “middle class welfare.” Political parties target the middle income 51% of the population with social programs and policies that benefit them, not the bottom 51% as we might expect. The most obvious of these programs is government-supported higher education (which benefits the middle class at the expense of the working class), but that’s another discussion entirely.
I believe that the Liberal government’s pursuit of aggressive immigration policies was done deliberately to increase demand for housing (making the middle class rich) and to provide more working class taxpayers to support the education of the middle class.
That’s exactly what I want. And I also want tax changes that stop homes from being a investment vehicles. That’s part of what has run prices up, in addition to the stuff we both listed above.