On November 22, Prime Minister Justin Trudeau unveiled the National Housing Strategy to deal with what many describe as a Canadian housing crisis. NDP party leader Jagmeet Singh described the plan as “unambitious.” In an article written by the CBC the plan was described as “ambitious.” Arthur thinks that the plan addresses housing.
This plan is directed at alleviating the wallets of Canadian households through benefits, while also using a public/private partnership to build affordable homes. This plan comes half a year after Kathleen Wynne’s Liberal government unleashed their plan which sought to establish tariffs on foreign investors in the housing market in Ontario.
This plan sought to cool the red hot housing market by curbing the amount of foreign capital that was creating “ghost towns” in which houses would be bought up and sit empty until they were eventually sold for a profit.
Time will tell whether either plan addresses the issue of housing adequately, in the meantime, Arthur is here to break down the broad themes of the new housing strategy.
1. 10 years to address a crisis?
The Liberals are investing $40 billion over a period of ten years in order to address housing in Canada. For some this may seem inadequate. Because of the acute nature of the housing crisis, there are some who feel that the timeline should be much shorter. Although chances you will be a millionaire in about 6 months after monetizing your Instagram account so what do you have to worry about?
2. The CMHC is getting cash
The Canadian Mortgage and Housing Corporation is receiving roughly $5 billion from the government over this ten year period. This money is meant to leverage an additional $10 billion from the private sector to fund mortgages. The CMHC is Canada’s largest crown corporation in terms of pure assets, being valued at just over $250 billion.
3. 100 000 new houses
The Trudeau government also plans to build 100 000 affordable houses over the next ten years. That being said, the government is also planning to transfer land valued at $200 million to developers, as long as said developers meet affordability, environmental, and socioeconomic standards. Like most centrist policies, the national housing strategy seeks to establish a public private partnership that seeks to turn government into a well-managed business.
4. Here’s your $2500 — but in 3 years
Another key point of the plan is a rent subsidy which one average will provide $2500 to be targeted to low-income tenants. The subsidy will cost the government approximately $4 billion over the next decade, but will be funded through a partnerships between provinces and Ottawa. The only catch is that this benefit will not come into effect until April 2020. This again points to nature of this plan, which is to address housing in Canada over a long period of time, while neglecting immediate measures to help people deal with a brutal housing market.
5. Cutting acute homelessness in half in 10 years
In the National Housing Strategy is an initiative to build 7000 shelters across Canada, in order to alleviate the issue of acute homelessness. Every policy to build more affordable houses is one directed at reducing homelessness, but shelters mitigate the effects of dire poverty on the homeless. They are criticized for being Band-Aid solutions to a systemic problem, but a world with inadequate shelters is one where those in need live needlessly dark lives.
That the Trudeau Liberals are acknowledging housing as a fundamental right is a net positive for society. It shows that the political class is capable of listening to Canadians who have been decrying Canadian housing as woefully inadequate for the past couple decades.