It would be assumed that a vital area of concern in an election during the pandemic would be hearing each party’s pandemic response and recovery plan (even more so for Canada, whose recovery has lagged compared to its counterparts in the G7). However, while that remains a meaningful topic, another issue seems to be of almost equal concern—the Canadian housing crisis.
The different parties have been regularly questioned on their plans of addressing the Canadian housing crisis. The average home in Canada climbed by 38% from the previous year and reached an all-time high of $716k in March. The average home prices in major cities like Toronto, Vancouver, and Ottawa are $1.06 million, $1.2 million, and $620k, respectively.
With speculations of rising interest rates, the house price becomes more worrisome. Benjamin Tal, the Deputy Chief Economist at CIBC, says, “That’s the number one issue facing the Canadian economy: the increased sensitivity to higher interest rates.” These are reasons why the proposed plans to tackle the housing crisis have the potential to sway voters.
The Liberal Party currently holds office and introduced a 10-year housing strategy in 2017, investing nearly $20 billion in social infrastructure. The plan sought to build 100,000 and repair 300,000 affordable units, provide 300,000 households with financial assistance through Canada Housing Benefits, and cut chronic homeless by 50%.
The Conservatives and New Democratic Party have critiqued their strategy as inefficient in managing the country’s housing crisis. However, the Liberals have not yet released a platform on housing for the 2021 Federal Election. Being the current ruling party, they may be examining weaknesses in their plan and re-strategizing.
The Conservative party, led by Erin O’Toole, has released a document called “Canada’s Recovery Plan”. In this160 page document, some of the ambitious plans outlined by the Conservatives are to:
- Build 1 million homes in three years
Reduce inflationary impacts of foreign buyers by banning their home purchases in Canada (this will be reviewed after two years)
Invest $325 million in residential drug treatments and community centers
Make mortgages more affordable by different means, such as addressing the stress test requirement for homeowners.
The New Democratic Party (NDP), led by Jagmeet Singh, has also put forward a 150-page document called “Ready for Better”, outlining their campaign promises. Some of the plans outlined by the NDP are to:
Create at least 500,000 units of quality affordable housing in the next ten years and set up “fast-start funds” to help construct co-ops, social and non-profit housing
Imposing a 20% tax on foreign home buyers
Wave the federal portion of the GST/HST on the construction of new affordable rental units to spur its construction
Introduce 30-year mortgages insured by the Canada Mortgage and Housing Corporation.
The Green Party is yet to release its platform.
The Executive Director of the Canadian Housing and Renewal Association, Jeff Morrison, said: “It doesn’t really matter where you fit on the housing spectrum, housing is in a state of crisis in this country.” Both homebuyers and renters are concerned as the gap between average home prices and income grows wider.
The 2021 Canadian Federal Election is scheduled on September 20, 2021.