Carney’s Housing Plan

Prime Minister Mark Carney has introduced an ambitious housing strategy aimed at addressing Canada's affordability crisis by significantly increasing the nation's housing supply. The cornerstone of this plan is the construction of 500,000 new homes annually over the next decade, effectively doubling the current rate of residential construction .(deeded.ca, Liberal Party of Canada)

Key Components of the Housing Plan

1. Establishment of Build Canada Homes (BCH)

A new federal agency, Build Canada Homes, will be created to spearhead affordable housing development. This is a spin off from the CHMC. This is almost like the Wartime Housing Ltd, a Federal Agency that built homes during and after the Second World War to address the housing crisis back then. Between 1941 and 1947 the Wartime Housing Limited was Canada’s first Federal agency that was responsible for building houses for wartime veterans and workers. Most of the homes built were rentals which eventually turned into permanent homes. Today it is now called the CMHC.  BCH responsibilities include:

• Acting as a developer to build affordable housing at scale, including on public lands.
• Providing over $25 billion in financing to innovative prefabricated home builders in Canada, utilizing technologies such as mass timber and softwood lumber to construct homes more efficiently and sustainably.
• Offering $10 billion in low-cost financing and capital to affordable home builders .(deeded.ca, Liberal Party of Canada, Liberal Party of Canada)

2. Regulatory Reforms and Incentives

To facilitate and accelerate housing development, the plan includes:

• Cutting municipal development charges in half for multi-unit residential housing, while collaborating with provinces and territories to ensure municipalities remain financially whole. Experts feel that this should be applied to all homes, not just multi-unit properties.
• Reintroducing a tax incentive, originally implemented in the 1970s, which previously spurred the construction of tens of thousands of rental housing units across the country. This is called the Multiple Rental Building cost allowance and was credited with building almost 200,000 units. (CBCnews)
• Facilitating the conversion of existing structures into affordable housing units.
• Building upon the Housing Accelerator Fund to further reduce housing bureaucracy, zoning restrictions, and other red tape, enabling builders to navigate a more streamlined housing market .(Liberal Party of Canada)
• No GST on new builds for first time home buyers for homes less than one million. This has faced a lot of criticism because it will not do anything to make homes affordable and this should be spread to all homes and buyers. Also, most homes in expensive markets like Vancouver and Toronto are over one million.

3. Workforce Development

Recognizing the need for a skilled workforce to meet construction targets, the government plans to cover apprenticeship training costs of up to $8,000 and create more training opportunities in the skilled trades. This initiative aims to equip more Canadian workers with the skills necessary to participate in the housing construction boom .(Liberal Party of Canada)

4. Environmental Considerations

The plan emphasizes sustainable building practices by promoting the use of mass timber and other eco-friendly materials. Additionally, Carney advocates for densification over urban sprawl, proposing the elimination of unit maxima, abolition of parking minima, and allowing taller buildings and increased density near transit lines to create low-carbon housing solutions .(Liberal Party of Canada, Wikipedia)

Implementation Timeline and Challenges

While the plan sets forth a clear vision, its successful implementation will require coordinated efforts across federal, provincial, and municipal governments. Challenges such as labor shortages in the construction sector may pose obstacles to achieving the ambitious target of 500,000 new homes per year. Not to mention this was tried before under Trudeau’s government when they created the Canada Infrastructure Bank (CIB). Under the CIB, only 2 projects out of the 76 projects were completed, prompting the abolishment of the CIB.(Fraser Institute) Nevertheless, the government is committed to addressing these issues through workforce development initiatives and regulatory reforms.(Yahoo Finance)

For more detailed information on the housing plan, you can visit the Liberal Party's official website: (Liberal Party of Canada).

What are your thoughts? Do you think the Liberal Government will turn things around?