Advertisement

Ottawa is falling short on creating more affordable housing: watchdog

Click to play video: 'Your Money: What to expect as bidding wars heat up the housing rental market' Your Money: What to expect as bidding wars heat up the housing rental market
Personal finance expert Rubina Ahmed-Haq breaks down your latest money headlines, including tips to minimize the hassle of bidding wars in the rental market and ways you can budget for back-to-school expenses. – Aug 5, 2021

Parliament’s budget watchdog says the government is falling short of its aim to vastly expand Canada’s affordable housing stock despite a spending ramp-up in the billions.

In a report published Tuesday morning, budget officer Yves Giroux says Ottawa topped up expenditures on its national housing strategy by nearly one quarter for an average of $3.7 billion annually over the past three years.

But he says expired community housing deals with the provinces, a shift toward pricier affordable homes and program lags at the Canada Mortgage and Housing Corporation have “limited the impact” of the Liberal government’s plan.

READ MORE: House hoarding? Why some upsizing homebuyers aren’t selling their old homes

Since 2018 the CMHC, which oversees the bulk of the three-year-old strategy, spent less than half of the $1.2 billion allocated for two key initiatives: the National Housing Co-Investment Fund and the Rental Construction Financing Initiative.

Story continues below advertisement

As of last October, the Crown corporation had committed to creating 12,230 affordable housing units under the two programs, with nearly two-thirds of them capped at 72 per cent of median household income — well above the roughly half of median market rent mandated for the other one-third.

The report projects that the number of households in need of an affordable place to live will increase to about 1.8 million within five years unless more funding flows toward the problem.

In April, the federal budget promised $2.4 billion over five years, beginning with nearly $1.8 billion this fiscal year, for affordable housing and followed through on a pledge to tax foreigners who own vacant homes in Canada.

Click to play video: 'Priced out: Will the Canadian housing market crash? Why home prices may stay hot' Priced out: Will the Canadian housing market crash? Why home prices may stay hot
Priced out: Will the Canadian housing market crash? Why home prices may stay hot – Jun 5, 2021

Sponsored content