Breaking Down the Housing Debate


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Author: Christopher Alexander, Executive Vice President and Regional Director, RE/MAX INTEGRA, Ontario-Atlantic Canada

The 2019 federal election is fast approaching, and the housing debate continues to be a hot topic in the country. A national housing strategy that’s assessed annually and updated based on economic markers and buying trends is crucial to the longevity of Canada’s housing market.

Over the last year and half, real estate has made headlines: interest rates, high home prices, affordable housing strategies, and government intervention with new regulations such as the mortgage stress test.

Many Canadians, especially millennials, new immigrants and those employed in the so-called “gig economy” feel home ownership is becoming less tangible by the day. While politicians of all stripes acknowledge the mounting urgency of affordable housing, few are offering any timely or compelling solutions.

To-date, Canada’s housing affordability issue remains rampant. The government has made efforts to help Canadians effectively manage their household debt as a way to improve affordability, with the mortgage stress test, which I am 100 per cent supportive of – but the stress test has done more harm than good and is simply unrealistic based on economic forecasts.

As a country, we must incentivize and support homebuyers – especially first timers who are currently precluded from entering the housing market. We can’t let policies become barriers to the Canadian dream. We need a strategy to resolve our housing challenges in the long-term versus Band-Aid solutions to appease political agendas in the short-term.

To this end, it’s important that voters consider the different viewpoints of the parties as well as their own, as they prepare to cast their vote on October 21. Here’s an overview of the biggest housing hurdles to be addressed, as well as the party positions thus far.

Housing affordability and cost of living are among voters’ top concerns, making this the number-one focus for all party candidates in the 2019 Federal Election. Canadians seek a government that will address their housing concerns and prioritize the health of our economy. As election day nears, I encourage Canadian voters to educate themselves on the issues, and consider their candidates’ answers to these questions, to help inform their decisions:

  1. How will you address the mortgage stress test to ensure it effectively addresses housing affordability?
  2. How will you encourage millennials and first-time homebuyers to purchase homes?
  3. What’s the plan to create more affordable housing across the country – particularly in hot markets such as Toronto and Vancouver?

Housing debate topics up for discussion – and action


Between the lack of rental housing, supply of affordable housing and less incentive for developers to build more, Canada is experiencing a serious housing shortage. This is particularly true in our two biggest markets, Vancouver and Toronto, where the average cost of living continues to tick upward, and residents are left scrambling for affordable alternatives. Candidates must explore solutions that incentivize developers to produce more supply, but also provide options to citizens that enable them to purchase homes more easily and affordably.


Short-term rentals have removed approximately 31,000 spaces from the rental market, having a big impact on the long-term supply. While Canadians struggle to purchase affordable homes, they also struggle to find housing alternatives in the short-term, with the average one-bedroom in Toronto costing $534,349. This trend is not going away and must be addressed at the federal level now. From an investor standpoint, short-term rentals make sense, but in the context of liveability and neighbourhood dynamism, they pose many challenges for Canadians who looking for a place to call “home.” Governments need to consider regulation to ensure both stakeholders are well taken care of, and that the issues of both parties are addressed appropriately and effectively.


Homebuyers deserve an opportunity to climb the property ladder as much as previous generations, but the mortgage stress test in its current form is an obstacle in what has become a far-fetched dream. I am 100 per cent supportive of responsible debt levels and policies to ensure that goal, but let’s be realistic. Even with the recent modifications to the mortgage stress test, it still isn’t solving the affordability crisis in our country. Quite simply, the circumstances under which the stress test was first introduced are no longer a reality. As we look toward October’s election, it’s crucial to consider how government intervention might help or hinder Canada’s housing market. At the very least, Canada’s next government needs to reassess the stress test.

Every party has made plans and promises in the great housing debate. Will it be enough?

Liberal Party of Canada logo

Justin Trudeau’s Liberals1

On the Mortgage Stress Test:

  • Undertake a review of escalating home prices in high-priced markets – like Vancouver and Toronto – to determine whether speculation is driving up the cost of housing.
  • Increased the amount first-time buyers can withdraw from their RRSP’s to $35,000 from $25,000 in budget 2019
  • Earmarked $1.25 billion over the next three years for First-Time Homebuyers’ Incentive (which launched September 2, 2019)6
  • On September 12, 2019, promised an expansion of the First-Time Home Buyer Incentive (FTHBI) program to cover home values up to $789,000 in hot markets of Toronto, Vancouver and Victoria if elected.7
  • Up to $40,000 in interest-free loans for renovations to improve energy efficiency of homes. Grants of up to $5,000 to those buying zero-emissions new homes.
  • Addressing house-price inflation with a one-per-cent annual vacancy and speculation tax on homes held by non-residents or non-Canadians.

On Short-Term rentals:

  • Increase the new residential rental property rebate on the GST to 100 per cent, eliminating all GST on new capital investments in affordable rental housing.

On the Housing Shortage:

  • Provide $125 million per year in tax incentives to increase and substantially renovate the supply of rental housing across Canada.
  • As part of a new, 10-year investment of nearly $20 billion in social infrastructure, prioritize significant new investment in affordable housing and seniors’ facilities.
Conservative Party of Canada logo

Andrew Sheer’s Conservatives

On the Mortgage Stress Test:

  • Promised to scrap the tests on mortgage switches and consider additional measures that will improve housing affordability.2
  • Criticized the Liberals’ Carbon Tax, claiming that it will further erode affordability/cost of living, pushing the dream of home ownership even farther.3

On the Housing Shortage:

  • Will help get new homes built across Canada, addressing housing shortages and affordability issues by cutting red tape, shortening timelines and bringing down costs. 3
NDP logo

Jagmeet Singh’s NDPs

On the Mortgage Stress Test:

  • Double the homebuyer’s tax credit to $1,500 for first-time buyers.
  • Re-introduce 30-year terms to Canada Mortgage and Housing Corporation (CMHC) insured mortgages for first-time homebuyers.

On Short-Term rentals:

  • Remove GST/HST on the construction of new rental units.

On the Housing Shortage:

  • Create 500,000 units of quality, affordable housing in the next 10 years.
Green Party of Canada logo

Elizabeth May’s Green Party

On the Housing Shortage:

  • New developments will have a minimum of 20 per cent affordable homes.
  • Push for innovative solutions such as “tiny homes,” laneway housing, co-housing and secondary suites.
  • Invest an additional $200 million over projected increases in the 2018 budget in funding for shelters, social, co-op and supportive housing.

Real estate continues to be one of the safest and most reliable financial investments for Canadians. As real estate professionals, it’s our duty to help potential homebuyers navigate this tricky landscape and support them in determining their best options. We urge governments to develop a national housing strategy that addresses all issues relating to affordability, or risk pushing the Canadian dream of home ownership that much farther away for all.

1 Our plan for affordable housing,
Conservative leader vows to end stress test on mortgage switches,
Scheer says we are in a cost-of-living crunch,
2019 federal election platform guide: Where parties stand on everything,
Our platform,
2019 federal election platform tracker: Where the major parties stand so far,
7 Trudeau Liberals promise to expand first-time homebuyers program if elected,

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