Ottawa, Ontario – March 22, 2019
As Chair of the Federal Liberal Housing Affordability Caucus, I wish to congratulate the Minister of Finance for addressing the issue of Housing Affordability in Budget 2019 and for announcing new measures to strengthen Canada’s housing market, including creating new pathways for home ownership for thousands of middle class Canadian families.
Starting in the Fall of 2018, the Housing Affordability Caucus met with several housing stakeholders. We wish to thank all stakeholders for their time and input into forming a set of recommendations that were then forwarded to the Department of Finance.
Budget 2019 identifies measures that in our view address the issue of housing affordability, with the new and transformational shared equity mortgage program via a First-Time Home Buyer Incentive Program. This detailed program has the potential to open home ownership to tens of thousands of middle class Canadian families. This, along with policies aimed to boost supply in Canada`s housing and rental markets, as well as action to enhance tax compliance in the real estate market represent the Government’s commitment to ensuring a secure and affordable place to call home for all Canadians.
Budget 2019 commits $1.25 billion over three years to help lower mortgage costs for eligible Canadians. These funds will be available only to insured mortgages of first-time home buyers. The First-Time Home Buyer Incentive Program would provide funding of 5 or 10 percent of the purchase price. No ongoing monthly payments would be required under this new program.
For instance, a home costing $400,000 with a minimum required five per cent down payment or $20,000, would require a $380,000 mortgage. With the new incentive, a new home purchaser could receive up to $40,000 through the CMHC First-Time Home Buyer Incentive Program. This equity stake would lower the mortgage to $340,000 from $380,000, resulting in over $200 a month in lower mortgage payments.
Through Budget 2019, the Government proposes to:
- Make home ownership more affordable by introducing the First-Time Home Buyer Incentive that is expected to help approximately 100,000 first-time home buyers over the next three years reduce their monthly payments required to own a home.
- Provide first-time home buyers with greater access to their Registered Retirement Savings Plan savings in order to buy a home by increasing the Home Buyers’ Plan withdrawal limit from $25,000 to $35,000.
- Help boost supply in Canada’s rental market by making an additional $10 billion over nine years in financing available through the Rental Construction Financing Initiative, which will help build a total of 42,500 new units across Canada. This investment will focus on areas of low rental supply such as Vancouver and Toronto.
- Launch a new Housing Supply Challenge to encourage innovative solutions that would break down barriers limiting new housing, and work with other levels of government on long-term housing supply opportunities.
- Increase fairness in Canada’s real estate markets by taking action to improve the Government’s compliance and enforcement framework for anti-money laundering and taxation.
With these investments, the Government is working to increase access to housing that is affordable, and to help middle class Canadians realize their dream of owning a home.
“I wish to thank the Minister of Finance, for identifying the issue of Housing Affordability as a top priority, and for announcing concrete, transformational measures that will create new pathways to home ownership for thousands of Canadian families.”
Francesco Sorbara, MP Vaughan-Woodbridge
- Historic investments in infrastructure, including the National Housing Strategy which is helping more Canadians secure a safe and affordable place to call home. The Strategy is expected to build 100,000 new affordable housing units, repair 300,000 others, and reduce chronic homelessness by 50 per cent over the next 10 years.
- As part of this Strategy, the National Housing Co-Investment Fund was launched in May 2018, and is expected to help build 60,000 new units and repair or renew 240,000 existing units of affordable and community housing.
- Seven provinces and territories have signed bilateral housing agreements under the new multilateral Housing Partnership Framework. These agreements will see more than $7.7 billion in new federal funding flow to provinces and territories over the next decade, to support the stock of community housing and address regional priorities.
Media may contact: