Canada is in the middle of a housing affordability crisis and despite everyone’s best intentions, various policy initiatives and government investments, it seems the needle is not moving in the right direction — or at the very least, not moving fast enough. Canada must increase its housing stock by 5.2 million in the next seven years to meet current and growing demand. This is a monumental task, and we have no time to waste. 

And yet, it seems “wasting time” is synonymous with the building sector. Developers want to build, but permitting delays are hindering progress. Embarrassingly, Canada is infamous for its long wait times for project approvals, whether it be major public infrastructure, apartment buildings or residential communities. 

Witnesses who appeared before our Senate Committee on Banking, Commerce and the Economy last fall as part of our study on the housing sector agree. As we reported, “uncertain, misaligned, or overly burdensome regulatory environments often stall or prevent affordable housing projects from reaching completion.”

Hopefully, the adoption of Bill C-56 last fall is a step in the right direction, but this bill alone will not address the systemic issues undermining the sector. This bill implements a temporary enhancement to the GST New Residential Rental Property Rebate in respect of new purpose-built rental housing like apartments, student housing and senior residences, which should also help contend with increased costs and interest rates. I continue to believe that productivity and innovation must increase to offset these costs and improve affordability and accessibility.

Indeed, by eliminating taxes on new rentals, which some provincial governments have also done, developers should be incentivized to build units that otherwise would not have been built.

It would also be to our advantage, particularly in urban centres, if governments focused on and encouraged densification. As we submit in our committee report, the federal government should consider attaching conditions to municipal funding for public transit that would require housing densification near those projects.

When the then-minister of immigration appeared before the Senate in 2022, I raised this very issue with him, arguing that our immigration policy will be successful only if we provide the much-needed community infrastructure in and around new residential areas. We need all levels of government, along with stakeholders, to work on comprehensive community development plans that favour densification and address affordability. With the billions of public and private dollars being invested in housing and infrastructure, we can’t afford to work in silos.

Canadians expect governments to make smart investments, properly monitor progress, reduce administrative and regulatory burdens, and get units built in an expeditious manner that won’t trump quality and quantity.

Furthermore, while I appreciate Canada’s immigration policy has been under scrutiny in recent months, as some argue the increasing number of newcomers is further exacerbating the housing crisis, I think we need to be careful in totally putting the blame on immigration.

I concede that high immigration levels are contributing to housing shortages and affordability challenges. Considering the current environment and pressure on our society, curtailing our immigration targets might be necessary at this time. However, I also believe that the government needs to rethink its immigration policy and start prioritizing tradespeople. This view was shared by several witnesses who appeared before our committee. We need to be targeted in our recruitment efforts to find people who can help build those units we so desperately need.

Beyond immigration, we also need to encourage our youth to consider a career in the trades. For decades, we have been promoting university degrees and graduate studies as a one-way ticket to professional success and financial stability, but we should also promote trades as a viable, much valued and lucrative career choice among our high schoolers.

These two measures that could help address the shortage of skilled labour are included in our committee report. The government should take stock of our interim findings and give serious consideration to the 10 recommendations we outlined on ways of addressing housing affordability, which fall under four major categories: alignment, innovation, people and capital. I am confident the expert testimony we gathered could provide the governing Liberals with some policy inspiration for their upcoming budget.

Senator Tony Loffreda is the deputy chair of the Senate Committee on Banking, Commerce and the Economy. He represents the Shawinegan division of Quebec in the Senate.

This article appeared in the January 31, 2024 edition of The Hill Times.