The National Housing Accord is calling for an “industrial strategy” from Prime Minister Justin Trudeau regarding Canada’s housing crisis.
The new report entitled, A Multi-Sector Approach to Ending Canada’s Rental Housing Crisis, suggests that the federal government reduce taxation and create cheap financing to entice home builders into reaching a target of 2 million new rental units by 2030.
The recommendation to encourage builders to take on new projects comes at a time when 22% of home builders are canceling projects due to red tape and high interest rates, according to a separate report by the Canadian Home Builders Association (CHBA).
The multi-sector approach was put together by three experts on housing, Tim Richter of the Canadian Alliance to End Homelessness, Mike Moffatt of the Smart Prosperity Institute and Michael Brooks of Realpac.
“Millions of people — particularly those with the lowest incomes — are facing rapidly rising housing costs, driven significantly by an extreme lack of supply of the right types of rental housing,” it states.
The report said that in order to change the current housing dynamic, it’s crucial for the government to introduce these new measures within the next several months.
Canada’s rapid population growth has exacerbated the already overburdened housing market and the report estimates that the homebuilding rate must triple for the situation to be remedied.
Cities like Toronto and Vancouver are dealing with the fastest growing rent increases they have seen in decades. The demand greatly outweighs the supply and rent is at an all time high nationwide.
This has led many younger Canadians to lose faith in the Liberal government as they worry about the cost of living and their futures. Recent polls show a decline in support for Trudeau amongst younger voters.
The report calls for a total of 5.8 million new homes to be built over the next 7 years with 2 million of those new homes to be built for the purpose of renting.
To carry out this target, federal, provincial and city governments would need to cooperate on a strategy to work with both public and private builders. Additionally, they would also have to work with the nonprofit housing sector, investors and labour.
The report asks for the Trudeau government to reform the Canada Mortgage and Housing Corp fees and make amendments to the tax code to ease the current strains on rental housing. One example of this would be to eliminate sales taxes on new capital investments for apartments.