Pierre Poilievre: Yes, Justin Trudeau deserves the blame for exorbitant housing costs

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In an attack on my recent video about how the country is off track, Globe and Mail columnist Gary Mason tried to excuse Prime Minister Justin Trudeau for doubling housing costs during his eight years in office. . Housing costs, Mason said, have been rising for decades due to both global trends and the decisions of wealthy investors to go after desirable markets such as Vancouver and Toronto.

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There are two false claims here: first, that this is an old problem in Canada; and two, that we simply have the same problems as the rest of the world.

Unaffordable housing is a new problem in Canada. Housing affordability was consistent and reasonable throughout the Harper era. It took about 40% of the average family income to pay the monthly housing costs of an average single-family house. Now it takes 70% to reach an all-time high and an all-time high. Eight years ago, the average home in Canada was priced at a reasonable $454,976. Today it is $729,000. Based on rising home prices and rising rates, a buyer buying a typical home today faces monthly mortgage payments of $3,298, eight years ago it was 1 $418, according to housing analyst Ben Rabidoux.

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Trudeau presided over a 132% increase in the average mortgage payment. In Toronto, it now takes 25 years for a middle-income family to save for a down payment on an average home. Previously, you could pay off your entire mortgage at this time. As the adjacent graph of housing affordability over the past decades shows, these increases are new, drastic, unprecedented, and curiously synchronized with Trudeau’s rise to power. Clearly, this isn’t a decades-old problem, as Mason claims.

Now for Mason’s second mistake: This housing bubble in Canada is only part of a global trend. This too is false. Yes, housing has become more expensive elsewhere. But housing prices in Canada are higher and shortages worse than in almost any other country in the world.

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Vancouver and Toronto are now the third and tenth most unaffordable cities in the world. Worse than New York, London and Singapore even though the latter is the second most densely populated country in the world, with 2,000 times more people per square kilometer than Canada. The standard house in Canada now costs twice as much as in the United States, according to an article in Fortune magazine. Based on supply and demand, Canadian homes are expected to be much cheaper than US homes because they have 10 times more people to house on a much smaller land mass. We have the fewest houses per capita in the G7, even though we have the most land to build on. In fact, we have fewer houses per capita today than eight years ago because our population has outgrown houses. So why do we have so much land with so few houses?

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Government access control dramatically increases the cost of building homes, according to the CD Howe Institute:

Over the period (2011-2021), a single-detached home in Vancouver cost buyers almost $1.3 million more than it would cost to build in a market with no supply barriers. The cost of barriers there is so much higher now that it only started its steep rise in 2015, towards the end of the previous study period. The price differential between construction costs and the market price for a new single-family home is now over 60% of the total cost in Vancouver. Homes in the Toronto CMA are now costing buyers $350,000 more than the cost to build, about a third of the total cost.

Mason bristles at the suggestion that those blocking the houses are guards. BC is getting rid of supposed gatekeepers, he writes. Here, Mason admits a flaw in his argument: to get rid of the Guardians, they must first be a problem.

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Mason further says the provincial government has ordered cities and municipalities to rezone single-family neighborhoods to allow for tens of thousands of multi-unit housing projects. That’s great, and again, the province’s decision to take over city building approvals is proof that it agrees that local access control is the problem. But the government is just getting started, and it will take a few years and a lot of action before Canadians see any improvement.

The supply of projects from the Canada Mortgage and Housing Agency will be insufficient. It says Canada needs 5.8 million new homes, but is only on track to build 2.3 million, a deficit of 3.5 million homes. Increasing supply will be difficult. Critically, increasing supply takes time because construction time is important, but so is time to progress through government approval processes, the report says. This delay means we must act today to achieve affordability by 2030.

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What can the federal government do about this?

It’s simple. We must demand that cities allow more and faster homes to be built as a condition of obtaining federal infrastructure funds. Big city politicians care about getting that money more than anything else. They will only free up land and offer faster and cheaper permits if their federal money depends on it.

My common sense plan:

1. Require major cities to allow completion of 15% more housing as a condition of obtaining the full transfer of their federal infrastructure;

2. Give construction bonuses to cities that exceed the 15% target, as dollars should be based on housing completions, not pledges;

3. Demand massive apartment and condo projects around every federally funded transit station; And

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4. Sell 6,000 federal housing buildings.

Trudeau recently began to plagiarize my message on housing, eventually admitting that cities need to speed up permits to make housing affordable. He created a $4 billion housing accelerator. Here’s the problem: it funds promises rather than results. Cities will fill out forms using the right buzzwords and making the right promises. Then they’ll get a check long before anything is built.

Instead of funding promises, the federal government should be funding results. It should tie the number of dollars major cities receive for infrastructure to the number of new homes completed. Money should flow after the keys are in the doors. If you pay for promises, you get more promises. If you pay for results, you get results.

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Only results count. The Trudeaus only result after eight years and tens of billions of dollars of housing programs to double housing costs. It remains fashionable to give it a pass and make excuses; blame Stephen Harper or the war in Ukraine or some other unrelated distraction. The truth is that the costs are worse than ever and worse than elsewhere.

This is a here-and-now problem where the federal government is involved in almost every supply or demand factor: immigration is federal, monetary policy and deficits that drive up mortgage rates are federal. , mortgage insurance is federal, infrastructure is (partly) federal, and taxes paid by builders are largely federal. If Justin Trudeau and his supporters say the Prime Minister is not responsible for these federal policies, then what has he been doing for eight years?

We need a prime minister who will take out the guardians and bring him home.

Pierre Poilievre is leader of the Conservative Party of Canada.

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