OTTAWA (Reuters) - Canada plans to fund new 5-year rent-to-own housing projects as part of an over C$2 billion ($1.53 billion) investment aimed at creating nearly 17,000 homes across the country, Prime Minister Justin Trudeau said on Tuesday.
The money, earmarked in previous budgets, would go toward creating 4,500 new affordable housing units through a rapid housing plan and at least 10,800 houses through the government's Affordable Housing Innovation Fund, Trudeau said.
Funding would also be aimed at helping housing providers develop and test rent-to-own models and projects that would help Canadians transition from renting to buying their first home.
"Tackling housing affordability is a complex problem and there is no one silver bullet, but announcements like today's give more people a place to call home, and a real and fair chance at success," Trudeau said.
Boosting housing affordability was a key part of the Liberal government's April budget, which promised fresh funding and a ban on foreign investors from buying Canadian homes for two years, among other measures.
Trudeau targets $2B in spending to fix Canada’s housing supply, affordability issues
Construction crews work on a house in Kingston, Ontario on Monday June 13, 2022
Prime Minister Justin Trudeau detailed plans Tuesday to spend $2 billion to create more affordable housing across Canada.
That spending includes commitments made in the last two federal budgets.
Trudeau said part of that $2 billion would go towards the creation of 17,000 new homes in Canada, the majority of which would be affordable housing units.
He also announced a new five-year rent-to-own stream under the Affordable Housing Innovation Fund, applications for which are open to developers looking to use the model starting Tuesday. The 2022 federal budget allocated $200 million towards a rent-to-own plan.
While the Canadian housing market has shown signs of cooling since the Bank of Canada began raising interest rates earlier this year, Trudeau acknowledged that soaring rents have been a barrier for aspiring homeowners.
“For a lot of renters, saving to buy a home is increasingly difficult," he said from Kitchener, Ont.
Canada’s housing market is cooling as rates rise. But rents have never been hotter
New spending via the housing innovation fund will also go towards building 10,800 housing units to help address Canada’s supply gap, which economists have regularly identified as a barrier to affordability and home ownership in the country. Some 6,000 of those units would be affordable units, the government said.
No timeline was given on when those units would be completed.
Trudeau also announced Tuesday as part of the $2 billion a two-year expansion to the federal government’s Rapid Housing Initiative (RHI), which is not yet open for applications.
Read more:
Canada needs ‘all hands on deck’ to fill housing supply gap: CMHC
The third round of RHI was tapped for $1.5 billion in spending in the 2022 federal budget. In April, the feds said that money would support the construction of 6,000 affordable units, though Trudeau’s announcement Tuesday estimated 4,500 new builds.
The RHI launched in 2020 and has so far supported the construction of more than 10,000 units, according to the federal government's statistics, across two rounds of funding worth $2.5 billion.
The Liberals’ federal budget set aside $10.1 billion in spending over five years aimed at housing.
Deputy Prime Minister Chrystia Freeland said earlier this month that Ottawa will take "additional action if necessary" to improve housing affordability in Canada.
Construction crews work on a house in Kingston, Ontario on Monday June 13, 2022
Prime Minister Justin Trudeau detailed plans Tuesday to spend $2 billion to create more affordable housing across Canada.
That spending includes commitments made in the last two federal budgets.
Trudeau said part of that $2 billion would go towards the creation of 17,000 new homes in Canada, the majority of which would be affordable housing units.
He also announced a new five-year rent-to-own stream under the Affordable Housing Innovation Fund, applications for which are open to developers looking to use the model starting Tuesday. The 2022 federal budget allocated $200 million towards a rent-to-own plan.
While the Canadian housing market has shown signs of cooling since the Bank of Canada began raising interest rates earlier this year, Trudeau acknowledged that soaring rents have been a barrier for aspiring homeowners.
“For a lot of renters, saving to buy a home is increasingly difficult," he said from Kitchener, Ont.
Canada’s housing market is cooling as rates rise. But rents have never been hotter
New spending via the housing innovation fund will also go towards building 10,800 housing units to help address Canada’s supply gap, which economists have regularly identified as a barrier to affordability and home ownership in the country. Some 6,000 of those units would be affordable units, the government said.
No timeline was given on when those units would be completed.
Trudeau also announced Tuesday as part of the $2 billion a two-year expansion to the federal government’s Rapid Housing Initiative (RHI), which is not yet open for applications.
Read more:
Canada needs ‘all hands on deck’ to fill housing supply gap: CMHC
The third round of RHI was tapped for $1.5 billion in spending in the 2022 federal budget. In April, the feds said that money would support the construction of 6,000 affordable units, though Trudeau’s announcement Tuesday estimated 4,500 new builds.
The RHI launched in 2020 and has so far supported the construction of more than 10,000 units, according to the federal government's statistics, across two rounds of funding worth $2.5 billion.
The Liberals’ federal budget set aside $10.1 billion in spending over five years aimed at housing.
Deputy Prime Minister Chrystia Freeland said earlier this month that Ottawa will take "additional action if necessary" to improve housing affordability in Canada.
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