Our economic recovery will be led by building, development
The COVID-19 pandemic has had a devastating impact on Canada, Ontario and the Greater Toronto Area, and my heart goes out to residents of the GTA who have been affected or lost loved ones to this terrible virus.
Millions of people were let go from their jobs and the economy has all but ground to a halt. As governments at all levels begin to look at recovery, they will need to focus on the GTA. Our region is the heart of Canada’s economy, accounting for 20 per cent of Canada’s GDP and 50 per cent of Ontario’s GDP.
The residential and commercial building and development industry, and the professional renovations industry, are major contributors to economic activity in the region. Collectively, they employ more than 360,000 people in the GTA, paying $22 billion in wages and generating $42 billion in investment value annually. Our industry is well-positioned to play a significant role in the recovery of our region, Ontario, and Canada. Working with our colleagues at both the Ontario and Canadian Home Builders’ Associations, we have put together a road map for simple changes that can have a big impact.
Our industry submitted a report to the Ontario Jobs and Recovery Committee that includes 19 recommendations to all three levels of government to get our economy back on track. These recommendations will create an immediate and significant impact to consumers and businesses, and will involve little to no new money from government. Proposed measures include suspending the Canadian mortgage stress test, transferring mortgage tenancy to the date of occupancy for new condominiums, eliminating security deposits for the Ontario land transfer tax on affiliated transfers, and freezing municipal increases to property tax reassessments and development charges.
Many people have lost their jobs in all sectors of the economy. Many projects have been delayed, constraining consumer and industrial/commercial liquidity. Government coffers are also not bottomless, which is why they need to focus on liquidity and freeing up funds that would otherwise be stuck in such things as municipal agreements (refundable deposits paid by developers) and replacing them with surety bonds. These changes can be transitory until such time as we can all fully adjust to the new normal, or when a vaccine for the coronavirus is available.
Other suggestions include reinstating home improvement tax credits for homeowners to support ageing-inplace improvements or energy retrofits. These programs have in the past paid for themselves, since they cut out the black and grey renovation market.
I encourage you to read the full report at www.bildgta.ca and support us as we work toward recovery in the GTA, Ontario and Canada through residential and commercial construction and professional renovation.
David Wilkes is president and CEO of the Building Industry and Land Development Association (BILD) and a contributor for the Star. Follow him on Twitter: @bildgta