Federal budget will include more money for loans for apartment construction

Sarah Ritchie, The Canadian Press

Posted on Wednesday, April 3, 2024 2:47 pmEDT

Last updated Wednesday, April 3, 2024 3:18 pmEDT

OTTAWA – The Liberal government has revealed another glimpse of what it will present in the next federal budget, announcing it will set aside another $15 billion for an apartment construction loan program.

Prime Minister Justin Trudeau said the initiative is called “Canada Builds” and aims to “drive the construction of affordable apartments.”

The new money will bring the loan program’s available funding to $55 billion, the government said, and aims to build at least 131,000 apartments over the next decade.

The loan program was launched in 2017 and has so far helped create more than 48,000 homes.

“We’re going to make the entire funding pool available to partner partnerships with provinces and territories that come to the table with ambitious and fair housing plans,” Trudeau told reporters in Toronto on Wednesday.

Those plans can include low-rise and high-rise buildings, as long as the money is used to build apartments “that the middle class can afford,” he said. Trudeau said the loan program is aimed at ensuring people can live where they work.

Toronto Mayor Olivia Chow said that has become a critical issue in her city.

“When we’re trying to hire personal support workers, public health nurses, parks and recreation workers, child care workers, emergency medical services workers, you name it, we’re having a tough time. Because? Because they say they can’t afford to work in the city,” she said.

The government is also reforming the program to extend loan terms and expand financing to include student and senior housing.

The federal NDP criticized the announcement and the strategy behind it, saying 97 per cent of the units built under the loan program are unaffordable.

“Trudeau’s disconnected housing strategy is dominated by loans to for-profit developers that do not help Canadians who need housing they can afford,” said housing critic Jenny Kwan.

And the Conservatives said in a statement of their own that this appears to be more of the same “failed policies,” noting that more than half of the funds available under the apartment loan program are unallocated.

“Trudeau’s photo ops will not come close to building the 5.8 million homes needed to restore housing affordability for Canadians,” said housing critic Scott Aitchison.

The federal government also appears to have an uphill battle ahead of it to convince premiers to come on board.

Many of the government’s marquee policies – from child care and housing to dental care and pharmaceutical care – affect areas of provincial and territorial jurisdiction and require cooperation. That is not guaranteed throughout the country.

On Tuesday, Trudeau announced a $6 billion infrastructure fund to support housing construction and a $400 million top-up to the housing accelerator fund.

The Liberals say funding for provinces and territories will come with conditions, including adoption of the recently announced tenants’ bill of rights.

While the series of housing-related announcements garnered praise from BC Premier David Eby this week, Ontario Premier Doug Ford said his government will not sign any federal agreement requiring municipalities to allow fourplexes.

“The difference between us and the federal government – ​​and I want to work with them, I work with them on many different issues on a daily basis – I don’t believe in forcing municipalities. “I believe in working with municipalities,” Ford said at a news conference Wednesday.

He went on to say that councils are best placed to ensure homes are built “where they belong”.

Asked about Ford’s comments, Trudeau said Toronto has put forward an “extremely ambitious housing plan” under the housing accelerator program.

“We would love to do that province-wide, but if the province doesn’t want to step up the ambition in building the infrastructure needed to support more housing generally across the province, we will do it specifically with willing partners. ,” he said.

Alberta’s social services and municipal affairs ministers issued a statement Wednesday saying they have “deep concerns” about Tuesday’s announcement, accusing the federal government of playing politics and bypassing the provinces.

“If the federal government is serious about cutting red tape and making housing more affordable as they claim, they will listen to our calls to eliminate the carbon tax to reduce construction costs,” the statement from Jason Nixon and Ric McIver said.

The Liberal government has said affordability issues are its top priority for months, and made housing a central theme of the cabinet retreat held before the fall session of Parliament began last August.

Finance Minister Chrystia Freeland will present the federal budget on April 16.

This report by The Canadian Press was first published April 3, 2024.

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