Mohammed Aaref’s dream of owning a home in Toronto is slowly dying.
“You save for 30 years – you do this and that – but it’s not enough,” he said.
Approaching retirement age, he fears his window to buy a house is closed.
“I waited too long,” Aaref said. “It’s never a good time, I guess, and unfortunately the good time has passed for me.”
The Trudeau government tabled its first budget since being re-elected in September on Thursday, outlining plans to respond to a bleak economic picture shaped by the pandemic and rising inflation, while promising to tackle affordability. housing for millions of Canadians like the Aaref.
But they have a steep hill to climb. Prices are so high in most markets across the country that nine out of 10 aspiring buyers surveyed in a recent survey said they had all but given up on their own dreams of owning a home.
The average price of a home in Canada has doubled since the Liberals came to power in 2015, reaching $816,720 in February. That figure is much higher in the Greater Toronto Area, rising nearly 28% year-over-year to $1.3 million in February.
Ban doesn’t go far enough, experts say
Among the new measures announced in the budget is a ban on foreign buyers buying non-recreational residential properties in Canada for the next two years. Foreign students, workers and permanent residents would be exempt.
But many experts familiar with the Toronto real estate market say the ban doesn’t go far enough.
“I don’t think it would be a blow to the rapidly escalating house prices,” Murtaza Haider, professor of property management at Ryerson University, told CBC Radio. Subway morning Thusday.
“It’s not enough, but it certainly won’t hurt any Canadian.”
R Statistics Canada report found that less than 5% of homes in Toronto and Vancouver were owned by non-residents. Also, says Haider, previous versions of these plans haven’t had much of an impact.
The biggest problem, he says, comes from supply, not demand. If there had been more homes built in the past half-century, Haider argues, home prices wouldn’t be where they are today.
Tim Hudak, CEO of the Ontario Real Estate Association, agrees.
In a statement on Thursday, he said the sole purpose of the budget should be to find ways to increase housing supply, adding that housing offers have always been open to all and foreigners should not be banned. to do.
“The commitment to ban the traditional bidding process is a huge step backwards,” Hudak’s statement read.
“It would unfairly target the financial nest egg of hundreds of thousands of families across the province and do very little to make housing more affordable.”
Commitment to double the construction of houses
The Trudeau government is also introducing measures to solve the supply problem. These include a so-called “housing acceleration fund” that would streamline the approval process for municipalities to build new housing estates, as well as a commitment to double the pace of new home construction.
“The Housing Acceleration Fund and the investment in improving municipal project review times is a very good thing,” said Dave Wilkes of the GTA’s Building Industry Land Development Association.
Ontario’s Conservative government also applauds the move, saying it is building on its own $45 million investment in January to accelerate development.
The federal government is also moving forward with something it launched during the election campaign last year – a first-ever tax-free home savings account.
Bridgette Cedilot, real estate agent at Royal LePage Signature Realty in Toronto, is cautiously optimistic that these measures will help.
“We’ll see – I’m not 100 per cent convinced,” she said.
While Cedilot doesn’t expect prices to drop “dramatically”, it hopes a larger supply will reduce bidding wars that can drive a home’s price well above its value. intrinsic value.
“It’s not something that is at hand”
Meanwhile, potential buyers can only wait and see if the federal government’s promises come to fruition and break a cycle all too familiar to many city dwellers. Aaref says he will have to leave Toronto when he retires because the houses are too expensive.
“What I can afford, I don’t want to live there and what I want to live is out of my reach,” he said.
Some doubt that the budget measures are helpful.
“It’s fine in theory, but I don’t know if it’s actually going to help,” said Toronto resident Camilo Montanez.
Montanez, 25, says buying a house is not feasible at the moment, but like many, he hopes that will one day change.
“It’s something I would love to do,” he said. “It’s not something that’s close at hand.”