Ontario government introduces plan to combat housing crisis

By Ken Kellar
Staff writer

The provincial government could make it more affordable for people in the province to own a home if they are re-elected.

In an announcement made on Wednesday, March 30, 2022, the Ontario government revealed their “More Homes for Everyone” act, a piece of legislation that, if passed, aims to crack down on speculative buyers, regulate predatory development practices and create more housing options for homeowners and renters by “accelerating development timelines” to have more homes built in a shorter period of time.

The plan is the result of a three-part consultation with industry, municipalities and the public, according to the release from the government. It also includes the report from the Housing Affordability Task Force, which the release says “highlights expert recommendations to increase supply and serves as Ontario’s long-term housing road-map” to help address the housing crisis.

Housing and the associated costs have been front of mind for many, particularly young people, across Canada for the past few years, as the cost of living has risen nearly everywhere in the country, and home prices have followed suit. According to real estate tech site WOWA.ca, the average home price in Canada was $816,720 in February 2022, up 20 percent from the year before. In Ontario alone, WOWA.ca’s data shows the average home price sits at $1,086,493 for February 2022, which is up 25.8 percent from the same month in 2021. Ratehub.ca calculates a homeowner would need a total yearly income of $154,125 to qualify for a mortgage on a $1-million home at 32 percent gross debt ratio, after a $200,000 downpayment and at a mortgage rate of 1.15 percent. Adding on other monthly bills like car or student loans makes the total requirements even more steep.

Even still, the site cautions against these numbers as being at the extreme end of the scale, which would leave the average homeowner with significant challenges in the future, particularly as interest rates rise, and any future costs, like rising cost of living, having a child, returning to school or even retiring.

Renters are left in the lurch as well, as rising rent costs and investment companies hoarding the housing supply begin to push renters into ever more precarious situations.

Hence, the government’s proposed plan to bring these numbers down by addressing several factors.

Included in the government’s proposal is an increase to the non-resident speculation tax, bringing it up to 20 percent, and applying the tax province-wide, along with closing certain tax loopholes. These changes came into effect the same day of the announcement. The government states this tax will apply to any home purchased in the province by foreign nationals, foreign corporations or taxable trustees.

Also included in the plan is a proposal to work with municipalities in several different capacities, which also aim to protect home buyers. The government plans to help combat land speculation, which the release says is in response to feedback provided to the province in regards to building projects that are approved by municipalities but remain unbuilt by developers. The government will also seek to double fines and extend building license suspensions for “unethical conduct” by developers, along with ensuring penalties for cancelled projects are “aligned with the impact on homebuyers.”

Further aid to municipalities will come in the form of a new tool the government says will be “specifically designed to accelerate planning processes.” Called the Community infrastructure and Housing Accelerator, it is meant to help expedite approvals for housing and community infrastructure like hospitals and community centres, “with clear requirements for both consultation and public notice.”

The government also included a promise to make it easier for municipalities to build more community housing by making better use of provincially-owned lands for non-profit housing providers. The government has established a new regulatory framework under the Community Housing Renewal Strategy that will encourage housing providers to “stay in the system and help vulnerable Ontarians get back on their feet.”

Ontario has committed to a housing supply action plan for every year beginning with 2022-23, which Minister of Municipal Affairs and Housing Steve Clark said will help to protect home buyers in the province.

“Our government’s plan proposes smart, targeted measures to protect consumers, and make the process work better and faster, help more Ontarians find the home that’s right for them and their families,” Clark said.

“However, there is no silver bullet to addressing the housing crisis. It requires a long-term strategy with long-term commitment and coordination at all levels of government. We are committed to introducing an update to Ontario’s Housing Supply Action Plan every year over four years in partnership with municipalities and sector associations and deliver long-term solutions for all Ontarians.”

The Ontario NDP’s platform on housing tackles some of the same issues, and features promises to make renting more affordable, make it easier to buy a home, combat big money, speculators, flippers and “bad developers,” and support a For Indigenous, By Indigenous housing strategy.

For more information about the government’s proposed plan, visit ontario.ca/page/more-homes-everyone.