Ontario budget shows lower projections for new home construction
Projections in Ontario's budget for housing starts show the province's target to build 1.5 million homes in 10 years slipping further out of reach with each passing year.
Nearly 100,000 homes were built in the province in 2022, the first year counting toward the goal, but the forecast shows the number of housing starts in the next few years struggling to crack 80,000 annually.
The projections are revised downward from what was expected in last year's budget, including an estimate of 79,300 homes built in 2024, down from the 87,300 expected for 2024 at this time last year.
Finance Minister Peter Bethlenfalvy says those private-sector forecasts reflect the economic environment, in which rising interest rates are hampering building.
He says the numbers don't reflect some of the government's recent steps to spur new home construction, including a law that, in part, freezes, reduces and exempts fees developers pay on certain builds such as affordable housing.
Bethlenfalvy says nearly all of Ontario's municipalities have adopted housing targets set for them by the province, so the government will continue to work with cities, the private sector and others to build homes.
Richard Lyall, president of the residential builders' group RESCON, said he is pleased to see that the government is putting $75 million over the next three years to the Skills Development Fund and $25 million to the Ontario Immigrant Nominee Program, in part to increase skilled trade immigration.
“With a massive skilled trades shortage looming, training the next generation of workers to build those houses is equally important (as a commitment to meeting the 1.5 million target),” he said in a written statement.
Tim Hudak, CEO of the Ontario Real Estate Association and former Progressive Conservative leader, said despite the government's moves to boost housing supply, rising interest rates are dampening growth, so the province should redouble its efforts.
“The city of Toronto recently took steps to prioritize ending exclusionary zoning to build housing, leveraging public lands to increase housing supply, and supporting the development of more rentals,” he wrote in a statement.
“These are the types of decisions that the Ontario Government must encourage in other cities and communities across the province if we want to solve the housing affordability crisis.”
Ontario should also consider expediting the use of underutilized provincial properties for housing, as well as introducing stronger rules to intensify around transit hubs, he said.
The effects of rising interest rates hit the housing market hard last year, with average home resale prices in January of this year down 21.3 per cent from their February 2022 peak, and the number of home resales was down 43.4 per cent, the budget said. But housing market activity is expected to start stabilizing.
The number of home resales is expected to decline by nearly nine per cent in 2023, though they are expected to rebound 21 per cent the next year before returning to more consistent levels, the government said in the budget.
Average home prices are expected to decline 9.7 per cent this year, before rising 2.2 per cent in 2024 and continuing to go up in the two years after that, the budget said.
Luca Bucci, the CEO of the Ontario Home Builders' Association - and a former chief of staff to Municipal Affairs and Housing Minister Steve Clark - said the budget takes important steps to accelerate the delivery of housing.
“Making it easier to get into skilled trades and investing in crucial highway infrastructure will help make it possible for awaiting families to get the keys to their new home sooner and increase the volume and variety of housing options our province needs,” he said in a statement.
This report by The Canadian Press was first published March 24, 2023.
CTVNews.ca Top Stories
DEVELOPING Live updates as Stormy Daniels testifies at Trump hush money trial
Adult film star Stormy Daniels will take the stand a second time Thursday as former U.S. president Donald Trump’s hush money case continues in Manhattan. Follow live updates here.
BREAKING Sheldon Keefe out as head coach of Toronto Maple Leafs
The Toronto Maple Leafs have fired head coach Sheldon Keefe. The team made the announcement Thursday after the Original Six franchise lost to the Boston Bruins in seven games in the first round of the Stanley Cup playoffs.
Bank of Canada says financial system is stable, but risks remain
The Bank of Canada says the Canadian financial system is stable, but risks remain due to debt servicing costs among households and businesses and stretched valuations of financial assets.
Why these immigrants to Canada say they're thinking about leaving, or have already moved on
For some immigrants, their dreams of permanently settling in Canada have taken an unexpected twist.
Here are the ultraprocessed foods you most need to avoid, according to a 30-year study
Studies have shown that ultraprocessed foods can have a detrimental impact on health. But 30 years of research show they don’t all have the same impact.
Ontario man frustrated after $3,500 paving job leaves driveway in shambles
An Ontario man considering having his driveway paved received a quote from a company for $7,000, but then, another paver in the neighbourhood knocked on his door and offered half that rate.
RateMDs violates privacy of health professionals, class-action lawsuit claims
A lawsuit against RateMDs has been given the go-ahead by a B.C. Supreme Court judge who found the claim that the website violates the privacy rights of medical professionals is not 'bound to fail.'
Capital gains tax change 'shortsighted' and 'sows division' business groups tell Freeland
Forging ahead with increasing Canada's capital gains inclusion rate 'sows division,' and is a 'shortsighted' way to improve the deficit, business groups are warning Finance Minister Chrystia Freeland.
Court to hear about search for remains as Winnipeg murder trial enters second day
A courtroom in Winnipeg is expected to hear testimony today about the search for the remains of the four victims of Jeremy Skibicki.