With Election 2021 on and in full swing, Tembo will dedicate three blog posts to outline what each of the three parties is offering to tackle housing, increase affordability, and help people get their first homes. In this blog, we’ll examine what the governing Liberals have in mind.
At its essence, the Liberal Party is rehashing its 2017 National Housing Strategy. They’ve repackaged and rehashed the older plan into a new, three-point housing pitch. The new pitch is called A Home For Everyone, and consists of:
- Unlocking Home Ownership: Liberals will help save a family buying their first home up to $30,000.
This part of the plan starts with a new, tax free First Home Savings Account to help young, prospective home buyers afford a down payment faster. It would combine the features of a RRSP and a TFSA and would allow up to $40K to be saved and withdrawn before the age of 40 tax free.
Another piece is the $5,000 First-Time Home Buyers Tax Credit will be doubled to $10,000, putting an extra $1,500 into the average buyer’s pocket to buy a home.
And another big piece is a new, $1B Rent-to-Own program. This money will be extended to developers to build rent-to-own projects. Ownership must be completed in five years, and rents will be required to be below market. There will also be measures to help people save on closing costs.
- Building More Homes: Liberals will build, preserve, or repair an additional 1.4 million homes in four years.
This starts with a $4B Housing Accelerator Fund aimed at increasing the housing supply in our biggest cities, for a total of 100,000 new middle class homes completed by 2024-25. Existing measures to increase affordable housing units and to convert more office space to residential housing will be made permanent. These are measures Tembo has already introduced to our readers in a past blog post. In this sense, this part of the plan doesn’t increase the net flow of funds, and just maintains what’s already going out the door.
- And Protect Home Buyers’ Rights: Liberals will create a Home Buyers’ Bill of Rightsto make the process of buying a home fairer, more open, and transparent.
Interestingly, the Home Buyers Bill of Rights will ban blind bidding, establish a legal right to a home inspection, mandating full transparency on recent house sale price on title searchers, and many other measures. The Bill of Rights would force banks and mortgage lenders to offer mortgage payment deferral options for up to 6 months for those who lose their jobs – a clear COVID inspiration.
The Libs are also increasing efforts to ban foreign ownership and speculative activity. A national tax on non-resident, non-Canadian owners of vacant or underused housing that kicks in on January 1, 2022 will be expanded to include foreign-owned vacant land. A proposal to temporarily ban new foreign ownership of housing will also be implemented.
As always, the Liberals plan to invest further in aboriginal housing, and to strengthen federal oversight of the housing market. All in all, the plan is decent, with some recycled components, some creativity, and some tough measures. Our next blog will look at the Federal Tory plan for housing.
You can read the Housing component of the Liberal manifesto in full detail here.