Ontario Premier Doug Ford has assured residential builders that he is ready, willing and able to work with them to kick-start the ailing industry as it is critical to the prosperity of the province.
He told an annual general meeting of the Residential Construction Council of Ontario (RESCON) that his government has taken steps to streamline approvals, reduce red tape and lower sales taxes on new housing, but noted more action is needed to increase the supply of homes.
“We know homebuilders need government doing what we can to create the environment for growth in construction,” he said. “Let me be very clear, we will continue to work with you to get shovels in the ground faster.”
Ford, who was keynote speaker at the event, touted investments that the government has made over the past few years aimed at boosting the residential construction industry and other sectors.
He said the government is focused on delivering a plan of more than $220 billion to build, repair and expand critical projects like schools, hospitals, highways, housing-enabling infrastructure and other critical services. It is the largest infrastructure expansion in Canadian history.
Last summer, he said, the province announced another $1.6 billion for the Municipal Housing Infrastructure Program (MHIP) to speed up construction on homes and critical projects like roads, bridges and water systems. The investment nearly doubled the MHIP funding to $4 billion.
The MHIP has already enabled the construction of 800,000 homes across the province since 2014, said Ford, and a $1.2-billion Building Faster Fund is providing communities the resources to build.
“But none of this works if we can’t increase our supply of homes and keep the dream of home ownership alive for the next generation of young people,” he said.
Earlier, the province removed the full eight-per-cent provincial portion of the HST on qualifying new purpose-built rental housing.
In the last fall economic update, the government also announced a rebate of the eight-per-cent provincial portion of the HST for first-time new home buyers on new housing up to $1 million and on a sliding scale for first-time buyers of homes purchased between $1 and $1.5 million.
“This rebate will save buyers up to $80,000 off the cost of a new home,” he said.
The provincial rebate is contingent on the feds eliminating the five-per-cent sales tax on new housing for first-time buyers. The legislation was approved in the House of Commons and is now before the Senate.
Together, the reductions would shave $130,000 off the cost of a new $1-million home.
Ford said the provincial government now wants to up the ante and work with the federal government to rebate the full HST off all new homes.
He said there doesn’t seem to be any harm in extending the cut to all new home buyers “because if people aren’t buying, you aren’t making the income.”
Such a change would move the needle, and more construction workers would have jobs which would lead to the purchase of more consumer goods like appliances and furniture, he said.
If sales taxes were cut, and development charges (DCs) were lowered, “you would see the market take off like you’ve never seen before.”
Ford said DCs add tens of thousands of dollars to the cost of a new home, and he is glad to see that some municipal leaders, like Vaughan Mayor Steven Del Duca, recognize that challenge. The City of Vaughan lowered rates for residential construction by 88 to 92 per cent in 2024.
Municipal Affairs and Housing Minister Rob Flack told builders the government understands, in no uncertain terms, the challenges faced by the industry.
The message has been conveyed loud and clear that “it takes too long and it costs too much to build homes in Ontario and we are changing that.”
The minister noted that governments don’t build homes; private builders do.
“Our job, as the premier says, is to create the conditions, the environment, for you to do what you do best; to help our municipal partners do the same, and work to make sure that that happens.”
For starters, Flack said, the government has made changes to simplify and standardize the provincial building code. The province is also ensuring DCs are being used for the purpose they were intended – and not being spent on projects that have nothing to do with growth.
RESCON president Richard Lyall welcomed the remarks from both provincial leaders and others at the meeting.
He said the housing crisis has been decades in the making and the outlook is presently grim for builders, as was noted in a report prepared earlier for RESCON by Mike Moffatt of the Missing Middle Initiative.
“Tackling a complex moving crisis is no simple task,” Lyall said. “There is no doubt the leaders know what is needed systemically to cut the rest of the housing Gordian Knot. The premier is committed to reducing costs imposed on all new buyers and renters.
“It was clear from the remarks that the provincial and municipal levels of government understand the challenges ahead and are determined to act further and decisively this year.”
