We are being drip-fed federal budget announcements
Prime Minister Justin Trudeau has been busy announcing ideas that will appear in the federal budget to be tabled April 16. He will not leave much of the fun stuff for Finance Minister Chrystia Freeland.
On March 27, the topic of the day was rights for home renters, subsequently broadened to include home buyers.
Housing becomes more expensive when demand exceeds supply. Demand in Canada has ballooned because of the Liberals’ mismanagement of population growth.
The proposed “rights” are mostly redundant in Nova Scotia, and sometimes pointless.
For buyers, according to the 2021 Liberal platform:
■ Ban blind bidding, which prevents bidders from knowing the bids of other prospective buyers and ultimately drives up home prices. The value of this is debatable. Auctioneers use a transparent bidding process because it gets the highest price. Let the seller of a house choose their preferred method.
■ Establish a legal right to a home inspection to make sure that buyers have the peace of mind that their investment is sound. This already exists. During the pandemic some buyers voluntarily chose to give up the right.
■ Ensure total transparency on the history of recent house sale prices on title searches. This already exists. Available on Viewpoint Realty. It reveals the impact of surging demand. Knowing the history won’t change the price.
■ Require real estate agents to disclose when they are involved in both sides of a potential sale to all participants in a transaction. Redundant.
■ Move forward with a publicly accessible beneficial ownership registry. It may reveal who is behind corporate buyers. It won’t change the price.
■ Ensure banks and lenders offer mortgage deferrals for up to six months in the event of job loss or other major life event. Redundant. Lenders are likely to do that anyway.
For renters, from the recent news release:
■ Launching a $15-million Tenant Protection Fund. This would provide funding to legal aid and tenants’ rights advocacy organizations to better protect tenants against unfairly rising rent payments, renovictions or bad landlords. Might be helpful. Administering eligibility will cost as much as the funding.
■ Creating a new Canadian Renters’ Bill of Rights, developed and implemented in partnership with provinces and territories. This would require landlords to disclose a clear history of apartment pricing so renters can bargain fairly. You can’t bargain if there are a dozen others who want the same unit.
■ We will also crack down on renovictions, create a nationwide standard lease agreement and give renters more agency. It is hard to imagine a lease agreement that would work for every renter and every property. Renovictions are not all alike. Federal intrusion will add complexity without improving justice.
■ Making sure renters get credit for on-time rent payment. We’re going to amend the Canadian Mortgage Charter and call on landlords, banks, credit bureaus and fintech companies to make sure rental history is taken into account in your credit score. Landlords will be delighted to receive that. Dodgy tenants may not be as pleased.
Constitutional scholars will have noticed that almost all these items are matters of provincial jurisdiction. Also in the release are the list of federal funding programs in support of housing.
As they have done on many other matters, the Liberals are making availability of the program funding conditional on the provinces implementing their agenda, in this case the new “Bills of Rights.”
The previous and current funds are numerous and large: $4 billion to persuade municipalities to loosen their building restrictions, $54 billion of loan money available to support more construction, $4 billion to support not-forprofits to create housing for the homeless and an increase in Canada Mortgage Bonds from $40 billion to $60 billion.
One announcement that will not appear before the budget is the expected deficit for the next five years. The Liberals have long ago abandoned pretence of any fiscal discipline, with anticipated future deficits growing every year.
As payment to the NDP for their political support, the deficit will be accelerated by the introduction of dental care and universal pharmacare programs, which will have an enormous cost. The big winners will be large employers who will be relieved of the costs for their employee benefit programs.
Meanwhile, Canada’s military spending is an embarrassment. We are not pulling our weight in NATO at a time when Russian expansionism is rife in Europe and could easily challenge Canada’s area of Arctic sovereignty.
The single most helpful thing the Liberals can do for housing costs is to get a grip on population growth, in particular of non-residents. So far they are proceeding too slowly.