OMDREB commends Federal Government on its housing-focused fall fiscal update
Milton, ON, November 21, 2023 – For years, The Oakville, Milton and District Real Estate Board (OMDREB) has called for numerous changes to the mortgage stress test through conversations with Members of Parliament, on behalf of members and their clients. OMDREB commends the federal government on listening to industry stakeholders and partners, as shown through the release of the Fall Economic Statement earlier today, which includes a new Canadian Mortgage Charter.
The Canadian Mortgage Charter allows for more homeowner flexibility when a switch of lender is involved in an insured mortgage up for renewal. Specifically, the Charter includes the removal of stress test requirements for the borrower in this scenario - requirements which have long thought to have been too strict for requalifying.
Prior to the introduction of the Charter, borrowers who switched lenders when renewing their mortgages were not exempt from the stress test. After the Bank of Canada rapidly raised its interest rates over the past year and a half, the need to requalify and pass the stress test has boxed many homeowners out of the chance to shop around for the best possible rate.
As a result of the Canadian Mortgage Charter, the ability to shop rates upon renewal should help save homeowners money during a period where the ability to afford a home is seen as a challenge for many.
OMDREB applauds the Fall Economic Statement also outlining the government's continued proposed action to address the shortage of available housing across the country. The Statement introduces new financing to build more homes as quickly as possible, and takes steps to crack down on short-term rentals so that homes can be used for people to live in permanently.
OMDREB has continually advocated for an increase in supply across the entire housing spectrum, notably forming the Halton Regional Housing Roundtable earlier this year with other industry partners, including participation from various Federal Government representatives.
The complete Fall Economic Statement can be found here.
Highlights of the measures introduced in the Fall Economic Statement (via CREA):
- Reaffirming the commitment to tie infrastructure funding to actions by provinces, territories, and municipalities to increase housing supply where it makes sense to do so;
- Expanding the removal of the Goods and Services Tax (GST) from new, purpose-built rental housing projects, to include co-ops;
- An additional $15 billion in new loan funding, starting in 2025–26, for the Apartment Construction Loan Program, bringing the program’s total to $40 billion;
- An additional $1 billion over three years, starting in 2025–26, for the Affordable Housing Fund, supporting non-profit, co-op, and public housing providers, to build more homes;
- Increasing the Canada Mortgage and Housing Corporation’s (CMHC) annual limit of support for low-cost financing by $20 billion per year and designating the increased amount for funding mortgages on multi-unit rental projects insured by CMHC;
- Repurposing surplus federal properties to be developed into new homes;
- Investing $309.3 million in new funding for the Co-operative Housing Development Program; and
- Introducing legislation to establish the Department of Housing, Infrastructure and Communities (currently Infrastructure Canada), in recognition of the link between housing and infrastructure.
More Construction Workers to Build More Homes
- Prioritizing construction workers with skills to expedite the home building process, for permanent residency.
Supporting Renters, Buyers, and Homeowners
- Introducing various measures to crack down on non-compliant short-term rentals.
The Mortgage Charter
- Introducing a new Canadian Mortgage Charter, which will enforce fair, reasonable, and timely mortgage relief measures, from federally regulated financial institutions to mortgage holders, which includes a long-term REALTOR® position to not require insured mortgage holders to requalify under the insured minimum qualifying rate when switching lenders at mortgage renewal.
The government stated it intends to propose new amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and the Criminal Code to strengthen Canada’s anti-money laundering and anti-terrorist financing framework. The government is also consulting on several changes to the Underused Housing Tax (UHT) to help facilitate compliance.
OMDREB will continue to monitor these measures and assess the impact they have on the housing continuum, including homeowners, renters, and REALTORS®.