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National Housing Strategy should target real estate’s investor allure, say experts

Nov 24, 2016|Source: Metro News

Housing experts are giving a new report on Canada’s National Housing Strategy high marks for focusing on rental housing, but say it fails to address the inequities that have been created by treating homes as investments.

“These people who are in these next generations now have difficulty accessing housing in the more expensive housing markets. So what are we going to do about that?” said David Hulchanski, a professor at University of Toronto’s Centre for Urban and Community Studies.

“(The federal government) has to question basic parts of the housing system and I don’t think they’re willing do that.”

The report released Tuesday summarizes the four months of consultation the federal government undertook with feedback from 7,000 Canadians across the country. The consultation will inform the federal government’s National Housing Strategy, which will be released along with the federal budget in February 2017.

The federal government stepped out of the housing arena in the early 1990s. Penny Gurstein, director of the School of Community and Regional Planning at the University of British Columbia, welcomed that re-engagement. She believes the housing unaffordability crunch seen in many Canadian cities can’t be solved without the involvement of the federal government.

“There has to be some way of the federal government inducing rental housing, and that was done before,” Gurstein said, referring to federal incentives and tax credits available up until the 1980s to stimulate new rental construction. “Now what we need are new, improved mechanisms to do that.”

Paul Kershaw, a UBC professor and founder of Generation Squeeze, which advocates for Canadians in their 20s, 30s and 40s, said he was disappointed to see little mention of the plight of younger Canadians. Canada’s Gen-X and Millennial age groups have seen their wages stagnate while housing prices have continued to accelerate, Kershaw said.

“Seniors are referred to 27 times in the report and are routinely listed among the groups that are vulnerable in Canada’s real estate market,” he said. “By contrast, young people are only mentioned four times, and we are never referred to as one of those groups in the vulnerable category.”

Kershaw said that the emphasis on rental housing in the report is positive, but like Hulchanski, would have liked to have seen a greater emphasis on the need to focus on “homes first, investments second.”

“There’s a vacuum in this housing consultation report around tax policy changes that need to be considered as we go forward,” Kershaw said. “We have to start thinking about what we can do to moderate demand for housing and especially to minimize its demand as a vehicle for investment returns.”

Vancouver’s new empty house tax is an example of one method of “shifting the balance” away from investors who find it profitable to acquire and hold residential real estate, Hulchanski said. But “no one thing like that tax is going to be enough,” he said.

“These people who are in these next generations now have difficulty accessing housing in the more expensive housing markets. So what are we going to do about that?” said David Hulchanski, a professor at University of Toronto’s Centre for Urban and Community Studies.





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