Canadian Government Making Massive Changes to Fix the Housing Affordability Issue
Today (April 12, 2024) the federal government released a 28 page document going over their plans to fix housin in Canada.
Read more here: https://www.infrastructure.gc.ca/alt-format/pdf/housing-logement/housing-plan-logement-en.pdf
At a glance, it looks promising. I’m not exactly sure where the money will come from but they are diverting a ton of capital towards development. They’re implementing rules that hopefully make it easier to qualify. And they’re also implementing some rules around tentants (personal bias here: I think these ones are a bad idea).
Developing More Housing Stock:
- Temporary Accelerated Capital Cost Allowance for Apartments – Will increase CCA rate from 4% to 10% on new, purpose built rentals beginning between April 16 2024 and Jan 1 2031
- Expanding the removal of GST on Rental Housing
- Providing Low Cost Loans to BUld Apartments for Middle Class. They will give another $15bil in loans for the Apartment Construction Loan Program
- $100mil in low cost loans from the Apartment Construction Loan Program to build above existing shops and businesses across the country
- Release public lands in the form of leases to builders to develop more affordable housing
- Offer low cost financing and loans for homeowners to add additional suites
- Funding to incentivize developing services in municipalities
- Introducing a standardized housing design catalogue. This will include 50 low rise housing designs including accessory dwelling units, modular homes, and multiplexes. The phase afterwars will be for mid-rise and single family housing designs.
Making it Easier to Rent or Own a Home
- Launching a tenant protection fund
- Create a Canadian Renters’ Bill of rights
- Add Rent Payment into Credit Score History
- Extended Amortization to 30 years for First Time Home Buyers Buying Newly Built Homes
- Extended the Canadian Mortgage Charter
- Increased Limits on Home Buyers’ Plan withdrawal limits from $35k to $60k per eligible borrower
- Combatting mortgage fraud (finally) by consulting with the mortgage industry on tools to directly verify income with the CRA
- Confronting the “Financialization” of housing – the government intends to make it harder for big corporations to buy housing stock.
More to come…
The document mentions there is more to come in the 2024 Budget so stay tuned for April 16th!