Finance committee returning early to tackle unaffordable housing

The House of Commons’ Finance committee is cutting short its holiday break to find ways to rein in Canada’s runaway housing prices.

The all-party committee will hold its first meeting of the year on Wednesday.

Conservative Finance critic Pierre Poilievre had urged the committee’s early return, telling reporters on Jan. 5, “It’s time for politicians to get to work. We’ve been on vacation now for three weeks, and (Prime Minister Justin Trudeau) wants another nearly four weeks before the House comes back.” 

NDP Finance critic Daniel Blaikie told iPolitics on Tuesday he’s also eager to tackle the problem, as federal governments have long ignored “increasing cost pressures in the housing market, and I do think it’s important for the committee to look at (them).”

The average price of a home in Canada is about $720,000, which is 19 per cent higher than last year’s average, according to the Canadian Real Estate Association (CREA). Homes in Toronto and Vancouver average well over $1 million, making them the most expensive in Canada.

Blaikie said he hopes the committee also discusses inflation in general, which hit an 18-year high of 4.7 per cent in November.

During the September 2021 federal election, the Liberals promised to build 1.4 million new homes to help cool the housing market.

But Ottawa must also make it easier for developers to build homes quickly by taking a “carrot versus stick approach,” said Kevin Crigger, president of the Toronto Regional Real Estate Board.

“Smaller developers and individuals (should be encouraged to) convert lower-density properties to plex-type housing,” such as duplexes and town houses, he said.

Homebuilding comes with many risks, and the government should mitigate some of them, Crigger added.

Municipalities determine the scale, scope, and location of housing projects, and having to deal with multiple levels of government contributes to the high cost of housing, said CREA CEO Michael Bourque.

“(We’ll need) a very high degree of collaboration between levels of government in ways that maybe we haven’t seen before,” he said.

Another possible way to increase affordability is an annual surtax on Canadian homes valued at over $1 million. The tax could generate about $5 billion a year, which Ottawa could spend on more affordable rentals and co-ops, according to a recent report by Generation Squeeze, a non-profit organization. 

READ MORE: Surtax would help make homes more affordable: report

Conservative Housing critic Matt Jeneroux believes such a tax would do more harm than good, however.

“This (would be) devastating news for Canadian homeowners in skyrocketing real-estate markets like in Victoria, Vancouver and the Lower Mainland, Toronto, and Oakville, (Ont.), where the average home price is over $1 million,” he said in a letter to Housing Minister Ahmed Hussen.

“For many Canadians, this is a time of great certainty and financial stress,” Jeneroux said. “The last thing they need is a new tax that will rob them of their ability to secure their future.”

Correction: This story was updated at 7:33 p.m., as the previous version wrongly attributed the $1-million-surtax proposal to the NDP and not Generation Squeeze.

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