Oct 12 2024 49 mins 5
With the election just one week away, housing remains a pivotal issue for voters across Canada. This week, we take a close look at the New Democratic Party’s (NDP) housing policy, following last week’s review of the Conservative Party’s platform. The NDP’s 66-page action plan is packed with ambitious goals, focusing primarily on improving affordability for first-time buyers. One of their key initiatives allows first-time homebuyers to pay only 60% of a home’s price upfront, with the remaining 40% deferred until the home is sold or 25 years have passed. This program also offers government-backed supplementary financing, making it easier for Canadians to enter the market. In addition, the Attainable Housing Initiative (AHI) seeks to ease the burden of market-priced homes by funding 40% of the costs for 25,000 new units, particularly on Indigenous lands.
While the NDP’s proposals aim to increase access to housing, they do little to address the root cause of the affordability crisis—soaring home prices. For example, even with the government’s assistance, buying a $620,000 studio or a $1.3 million two-bedroom unit in Vancouver remains daunting. Some argue that the plan, while helpful for thousands of families, fails to lower the overall cost of homes, especially in cities like Vancouver, where prices are already hugely inflated compared to other North American markets. The NDP’s strategy is focused on making market-priced homes more accessible, but it doesn’t tackle the larger issue of the unsustainable growth in housing costs.
In other housing-related news, the Canadian Mortgage and Housing Corporation (CMHC) has announced a new policy that allows homeowners to add suites to their properties with up to 90% loan-to-value financing, set to launch in 2025. This move is part of an effort to increase housing density, but with a $2 million property value cap, its impact may be limited in high-cost areas. Meanwhile, rental rates have fluctuated across the country, with notable decreases in cities like Vancouver and Burnaby, while places like Quebec City and Saskatoon saw rent increases. Mortgage arrears are also on the rise, hitting 0.2% nationwide, the highest since May 2021, signaling growing financial pressures on homeowners.
Speaking more to rental rates, they have shown significant decreases across several major Canadian cities. Vancouver saw an 11% drop year-over-year for both one- and two-bedroom units, and Burnaby registered similar declines. However, Quebec City and Saskatoon experienced price hikes, with one-bedroom rents rising by 22%. This fluctuation in rental prices suggests that affordability issues continue to evolve across different regions, with some areas benefiting from decreased demand while others face rising costs.
As housing continues to be a central concern for many Canadians, both the NDP and Conservative platforms offer paths toward improved accessibility. However, neither party has yet introduced a comprehensive plan to lower home prices significantly. Voters must weigh whether these measures—focused on providing access rather than addressing affordability at its core—are sufficient in tackling Canada’s housing crisis as they prepare to cast their ballots. Tune in and find out how we feel about the NDP platform.
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