Some proposed measures were long overdue, while others impact consumers' interests
While the just-announced two-year ban on foreign home buyers has been generally welcomed by market players, reactions towards other aspects of Budget 2022 were more mixed.
Tim Hudak, CEO of the Ontario Real Estate Association, said that the federal government’s latest budget came with an assortment of much needed measures like the ban, boosted assistance for first-time home buyers, and $4 billion in funding for municipal planning and delivery of housing projects – but lacked one fundamental ingredient.
“It’s no question that increasing housing supply is the only solution to the housing affordability crisis,” Hudak said. “To help families achieve the Canadian dream of homeownership, the government needs to focus on building more homes that people can afford.”
Hudak added that a proposed ban on the traditional offer process is a misfire, and would effectively undermine consumers’ choices and property rights.
“[The ban] would unfairly target the financial nest egg of hundreds of thousands of families across the province and would do very little to make housing more affordable,” Hudak said. “It would also add more red tape to home selling and further restrict the number of homes on the market. The government should not be telling people how to sell their home.”
James Laird, co-founder of Ratehub.ca and president of CanWise Financial, bemoaned the lack of new provisions concerning qualification requirements.
“I was disappointed that the house value limit to qualify for mortgage default insurance was not raised from $1 million to $1.25 million like the Liberals promised in their election platform,” Laird said. “If implemented, this policy would help first-time home buyers enter the housing market because it significantly reduces their minimum down payment required.”
“The federal government continues to promote their complex and underutilized First-Time Home Buyer Incentive and rent-to-own projects, whereas a simpler and more effective way of making homes more affordable would be to increase the maximum amortization from 25 to 30 years for insured mortgages,” Laird added. “If we really want to help Canadians, this is the way to do it.”