Pierre Poilievre, the putative front-runner for the leadership of the Conservative Party of Canada, is wrong about a lot of things. He’s so consistently and noisily wrong, in fact, that being aggressively wrong has become his stock in trade. But one thing he’s right about is the sorry state of Canada’s housing market and the negative impact it’s having on young people, new Canadians and anyone else who doesn’t already own real estate.
It’s no secret that house prices in Toronto and Vancouver have reached utterly preposterous levels, and they definitely helped pull the national average up to a record high of $816,720 in February. That’s a 20 per cent increase from a year earlier, and it’s made finding a detached house under $1 million in those markets about as difficult as qualifying for the national Olympic team. But the MLS Home Price Index, which tries to create a national average that isn’t unduly influenced by markets like Vancouver and Toronto, is rising even faster. It’s up a record 29.2 per cent compared to February 2021, and it rose 3.5 per cent in the last month alone — yet another new record.
This isn’t, as Poilievre has repeatedly suggested, entirely due to “money printing” by the federal government (the federal government, for one thing, doesn’t actually control decisions made by the Bank of Canada). Local zoning decisions, the toxic influence of NIMBYism and provincial housing policies have all contributed to this stew of unaffordability. From Vancouver Island to Prince Edward Island, soaring home prices are becoming an unavoidable issue for the elected officials who have tried desperately to avoid it for years.
This isn’t a partisan thing, either. Whether it’s Doug Ford in Ontario, John Horgan in British Columbia or Justin Trudeau in Ottawa, leaders of every conceivable stripe have failed to take this as seriously as it demands, much less take on the entrenched interests that are standing in the way of meaningful progress.
If Poilievre wants to make it a signature issue of his campaign, and perhaps his future leadership, then it’s up to the Liberal government to get out in front of it. Trudeau’s pact with Jagmeet Singh buys him some time here, and it includes two agenda items specifically aimed at housing and affordability. The commitments to extend the Rapid Housing Initiative, which was a pandemic-era plan to create more affordable housing units, and top up the Canada Housing Benefit are good. But it’s the suggestion they’ll be “tackling the financialization of the housing market” that will be the real litmus test.
Their agreement didn’t spell out how they plan to do said tackling, but Trudeau and Singh won’t have to look far for ideas. Generation Squeeze, a Vancouver-based organization focused on affordability and intergenerational equity (and which received funding from the Canada Mortgage and Housing Corporation and its Solutions Labs program), offered up four potential solutions in a report it released in January.
The government, it says, should make bigger investments in green, affordable, purpose-built rental and co-op housing — and leverage the Canada Infrastructure Bank’s resources to do it. It should take low-density housing and use it to create a pool of permanently affordable rental units, along with a so-called “Perpetual Affordable Housing Bond” that could fund the expansion of that pool. And in a suggestion that should be music to Poilievre’s ears, Generation Squeeze thinks the government should direct Statistics Canada to report annually on the relationship between monetary policy and house prices.
But it’s the group’s fourth suggestion that deservedly got most of the attention — and generated much of the pushback. Generation Squeeze proposes the creation of a small surtax (starting at 0.2 per cent and rising to one per cent) on homes valued over $1 million. This has nothing to do with the massive untaxed capital gains that many older homeowners have built up. The proposal even suggests this modest tax could be deferred by homeowners.
As Generation Squeeze said in its report, “It’s time to ask the 10 per cent owning Canada’s highest value real estate to tolerate a small price on housing inequity in order to demonstrate allegiance to the Canadian dream that a good home should be in reach for what hard work can earn, whether in rental or co-op housing, or as owners.”
Some responses the group has received haven’t exactly been reasonable, though.
Opinion: For all his bluster and bravado, Pierre Poilievre is gifted at harnessing anger and putting it to work on his behalf, writes columnist @maxfawcett. #Canada #HousePrices
STEPUP, a Vancouver-based anti-tax group that calls itself “the leading voice for current and future homeowners in British Columbia and across Canada,” described Generation Squeeze head Paul Kershaw as a “radical left UBC academic.” It suggested, “Those of you familiar with Karl Marx’s work will also recognize the Communist undertones in Kershaw’s proposal.”
Best of all, STEPUP described Vancouver homeowners — many of whom have seen the value of their homes double or triple through no real work or effort of their own — as “beleaguered.”
This might be funny if it wasn’t for the real impact this attitude is having on the lives of so many young Canadians. And while Conservatives have traditionally struggled to break through among voters under the age of 50, this issue might be the key that finally opens that door for them.
For all his bluster and bravado, Poilievre is gifted at harnessing anger and putting it to work on his behalf. And make no mistake: young Canadians are getting increasingly angry about the unfairness and injustice that’s baked into our housing market.
If the Liberals want to avoid losing the next election in 2025, they need to actually do something to address that anger before it consumes them.