The April 16, 2024, unveiling of Canada's federal Budget 2024 has brought forth a myriad of promises and plans, chief among them being the ambitious Housing Plan. In a country where attainable housing has become an increasingly pressing issue, the federal government's recent commitment to address this challenge has garnered both praise and scrutiny.

Canada’s Housing Plan

At the heart of the budget lies a comprehensive Housing Plan aimed at tackling the housing crisis gripping many parts of Canada. With a target to unlock 3.87 million new homes by 2031, the plan operates on three pivotal pillars.

First, it emphasizes building more homes, injecting momentum into construction projects nationwide. Notable measures include a temporary accelerated capital cost allowance for apartments to incentivize builders to get more projects moving by increasing their after-tax return on investment. The federal government is leveraging its $55 billion Apartment Construction Loan Program by making it available to provinces and territories that launch their own ambitious housing plans, similar to the BC Builds initiative.

Second, measures are enacted to improve the process of renting or owning a home. Significantly, Budget 2024 proposes an increase in the Home Buyers’ Plan limit from $35,000 to $60,000, allowing Canadians to withdraw more from their Registered Retirement Savings Plan to buy or build a qualifying home. This increased limit has been a subject of sectoral advocacy for many years. Another longstanding advocacy piece is addressed through Budget 2024’s 30-year mortgage amortizations for first-time home buyers purchasing newly built homes. Some industry pundits have expressed concern over measures that increase demand, while the lack of appropriate supply continues to be a problem in many markets across the country.

Lastly, the plan aims to help Canadians unable to afford a home. The federal government plans to launch a $1.5 billion Canada Rental Protection Fund to preserve the affordability of existing homes and support the acquisition of new affordable homes. Budget 2024 also proposes an additional $1 billion for the Affordable Housing Fund, a $13.2 billion program providing low-interest or forgivable loans and contributions for new and repaired affordable and community housing.

Canada's Housing Plan represents a significant step towards addressing the pressing issue of housing attainability. Alongside the Canadian Real Estate Association, BCREA applauds the federal government’s commitment to tackling the housing crisis. However, the plan’s success will depend on the government's ability to implement effective supporting policies and collaborate with stakeholders, demonstrating our imperative to remain vigilant and hold policymakers accountable.

Given capacity concerns, there also continue to be questions regarding Canada's construction industry's ability to produce so many housing units. A move to more manufactured/prefabricated housing could be key to meeting Canada’s ambitious housing targets. BCREA will continue to advocate for thoughtful and evidence-based policies that can genuinely improve housing attainability for British Columbians.

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