Ford, Carney governments offer no guarantees on home building despite multi-billion dollar boost


Days after Premier Doug Ford announced the province would offer a one-year discount on newly built homes across Ontario, the housing construction industry says it’s experiencing a surge in phone calls from would-be buyers looking to cash in on the limited-time policy.

The province, along with the federal government, pledged to waive the entire 13 per cent HST on new construction developments starting April 1 — a taxpayer-funded measure that’s designed to boost sluggish construction sales.

The effect, developers say, was immediate.

“This week sales centres were buzzing, they haven’t been buzzing for two years,” said Dave Wilkes with the Building Industry and Land Development Association.

“I can’t believe the enthusiasm, the vibe in the industry.”

Shortly after, the federal and provincial governments announced yet another taxpayer-funded measure, this time designed to target municipal development charges — fees that are paid by developers and passed on to buyers.

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The joint $8.8 billion development charge policy, along with the HST rebate, would knock $200,000 off the price of a home, the governments said – a move the industry said would kick-start home construction.

“This industry had stalled,” Wilkes said. “We had an affordability challenge, we had a project viability challenge.”

“When looking at the changes collectively … we anticipate that this will probably double the number of starts we’re seeing in the sector over the next number of years,” Wilkes added.

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While the Ford government shares the development industry’s enthusiasm, the province remains skittish about defining the outcome.

After the government’s goal of building 1.5 million homes by 2031 failed, the province stopped highlighting the target altogether.

On Monday, Housing Minister Rob Flack declined to offer even a short-term target.

“I’m not looking for a massive increase over the next two months, but I think this Spring season will get it started, and I think you’re going to see some really good results,” Flack said.

“As long as we sell more homes than we did the month before, than we did the year before, and we see a progressive change upwards, I’m happy,” he added.

Instead, Flack said the government is looking to immediately “protect up to 100,000 jobs” in the home building sector at risk because of low construction.

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That lack of public pressure on the housing construction sector, however, isn’t unique to Ontario.

As Prime Minister Mark Carney and Premier Doug Ford announced the multi-billion dollar measure to cut municipal development changes by 50 per cent over three years, they outlined an expectation that cities would slash the remainder of the fees.

Global News asked both leaders what expectations they had of the housing construction industry, in exchange for billions in taxpayer-funded help.

Carney outlined the frustrations of developers felt with the cost of upfront taxes and fees and suggested the rush to build, under the new policies, would drive down costs.

“Do we expect that the competition amongst developers, the competition in the housing markets, means that gets passed down to the homebuyer? Yes, we do.” Carney said.

Ford echoed the sentiment and said competition will ensure developers follow through.

“I guess, what you’re asking, how do we keep the builders honest?” Ford said in response to the question from Global News.

“The market dictates. They’ll compete against each other, and those that are the most competitive and build the best products will sell the most units,” Ford said.

“That’s how we hold everyone accountable.”

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The Ontario Home Builders Association, which advocated for the changes, offered assurances that the policy would lead to the desired outcome.

“We believe the kickstart is going to get buyers back into the sales centres, we have to wait to see what happens after that,” said OHBA CEO Scott Andison. “Builders are going to be able to get shovels in the ground as a result of these changes.”

Still, Flack said, while he’s had “robust discussions” with the home building sector over how many homes could be built, he couldn’t offer a guarantee.

“Can you guarantee that someone’s going to actually build a house? I don’t think you can,” Flack said bluntly.

“What we’re trying to do is to create the conditions so people take their thumb off the pause button. And I think we’ve done that. I think we’re going to see some seriously good results in the coming weeks and months,” Flack said.



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