Canada’s Housing Plan was announced in April with the ambitious goal of tackling the housing supply and affordability crisis. Here is an analysis of the key aspects of this plan and the changes it could bring.

1. A Systems Approach

The plan finally adopts a comprehensive view of the housing issue. It treats housing as a systemic problem by considering all influencing factors, such as increasing participation in trades to reduce labor shortages, improving infrastructure, and breaking down municipal barriers.

2. Changing Mindsets

Canadians have traditionally viewed single-family homes as ideal. However, in major cities, this vision is no longer realistic. The plan encourages the construction of homes above shops, low-cost financing for additional units in existing homes, and the facilitation of municipal approvals.

3. Vacant Land Taxes

The government is considering taxing vacant land to incentivize property owners to develop these properties, which could increase housing supply.

4. Capital Gains Reform

An increase in the capital gains inclusion rate is planned, aiming to influence investor behavior and free up more properties for individual buyers.

5. Limiting Purchases by Large Corporations

The plan proposes restricting the purchase of single-family homes by large institutional investors, reducing competition for individual buyers.

6. Exploring Alternative Financing

To make homeownership more accessible, measures such as extending amortizations to 30 years, lengthening repayment periods for homebuyer loans, and expanding financing options like Halal mortgages are being considered.

Conclusion

These measures show a holistic approach to increasing housing supply and improving accessibility. The success of the plan will depend on its implementation, cooperation with provincial and municipal efforts, and market response.