A tale of two budgets

Spring has sprung, the Bank of Canada has held influential overnight rate for two consecutive announcements, and the GTA real estate market is showing signs of that typical seasonal resurgence. Roaring back to life, even.

All good, right?

Government-inspired initiatives

Sort of. Supply, or more specifically lack of, continues to be an issue. In the resale market, quality and fairly-priced homes in good areas are snapped up in days. In the new home segment, however, government-inspired initiatives to promote more homebuilding will take some time to fully come to fruition.

The 2023 federal and provincial budgets, then, are crucial to doing whatever they can to ensure the housing market remains as healthy as possible in the interim.

According to representatives of the homebuilding industry, the 2023 Ontario budget is expected to help address the housing supply issue facing the province. Entitled Building a Strong Ontario, the budget lays out important measures that will support more housing supply and choice across the province.

Says Terri Johns, president of the West End Home Builders’ Association, “The residential construction industry is encouraged by (the) budget, because it means the provincial government recognizes the need to build a strong foundation to construct the 1.5 million homes we need over the next decade, essential to restoring housing attainability in Ontario.”

Critical to economic well-being

“Boosting our housing supply is critical to the economic well-being of Ontario, and I was pleased to see that in spite of the strong headwinds we are facing, the government is intent on meeting the 1.5-million target,” adds Richard Lyall, president of the Residential Construction Council of Ontario (RESCON).

The federal budget, on the other hand, seems to come up a little short. RESCON says the budget includes items that will help young people enter the housing market, but it fails to address the problem of how to rapidly increase supply across the country.

“We have a crisis on our hands and need to build more homes quickly and make them affordable,” says Lyall. “The budget is nibbling around the edges of the problem and doesn’t fully address the systemic problems that are delaying construction of much-needed housing. We need to get more housing underway quickly as demand is expected to continue.”

Unfortunately, for something so important to Canadians, new Canadians and the economy overall, it seems to be a tale of two diverging budgets on the housing front.