OREA looks to government for answers amid falling homeownership rate

The Ontario Real Estate Association wants all levels of government to act on recommendations outlined in a report, including as-of-right zoning, and lower taxes for young families and first-time buyers.

In a letter to Steve Clark, minister of Municipal Affairs and Housing, OREA President David Reid expressed the association’s concerns about dwindling rates of homeownership in the Ontario:

“The lack of housing supply in Ontario is eroding the next generation’s ability to achieve the Canadian dream. For the fi rst time since Confederation, home ownership rates in Ontario are on the decline. We must take bold action to cut red tape on housing supply and reduce barriers to development so families have more affordable choices in the market.”

Reid also expressed gratitude for the Ontario government’s commitment to increasing housing supply, but also noted that there’s still much work to be done.

“OREA knows that Premier Ford and your Government are committed to action on housing affordability. We look forward to working with you to ensure the Housing Supply Action Plan brings forward the right solutions to increase housing supply and reduce costs for first-time home buyers,” continued the letter.

“Your Government has the ability to reverse the declining rate of home ownership. In fact, OREA believes that Ontario should set a bold target of increasing home ownership rates to 70% by 2025 and 75% by 2040 by implementing policies that will support greater housing supply and housing choice.”

Sage Real Estate Ltd. team lead Christine Cowern says she’s “100% on board with OREA’s recommendations,” but added that development charges—which get passed onto consumers—along with other taxes, are eroding affordability.

The B-20 mortgage stress test, arguably the biggest hurdle to homeownership today, isn’t likely to get repealed, though, and Cowern says that, while it’s too punitive in its present form, it does serve a purpose.

“Unfortunately, I think the chances are very slim that the stress test will be reversed,” she said. “I don't think that getting rid of it entirely is beneficial because it has helped keep rising home prices in check. The best option, in my opinion, is a more middle-of-the-road one: Why not lower the qualifying rate to take into account income growth and the fact that the homeowner's mortgage principal is going down over time? That's more of a win-win, in my opinion.”

OREA’s recommendations:

1. Implement As-of-Right Zoning
2. Reduce New Neighbour Taxes
3. Say No to Another Home Owners Tax
4. Cut Municipal Red Tape on Secondary Suites
5. Lower Taxes for Young Families & First-Time Home Buyers
6. Remove the Straitjacket of the “One Size Fits All” Growth Plan
7. Speed Up the Planning Approvals Process
8. Fix the OSFI Stress Test
9. Rebalance Heavy Handed Mortgage Restrictions
10. Unlock Surplus Public Lands to Build More Housing