With information from David Dagenais
The Housing Action Plan presented in theEconomic statement of November 21 presents new investments.
“We are releasing billions of dollars in new funds, which will be used to support the construction of new housing for Canadians,” said Chrystia Freeland in her speech to parliamentarians.
Build quickly
Starting in 2025-2026, the federal government plans to invest $1 billion in the Affordable Housing Fund, to enable non-profit businesses, cooperatives and public housing to build 7,000 new homes by 2028 This number is in addition to the 31,500 new housing units already planned in this plan.
The Apartment Construction Loan Program received an increase of 15 billion dollars to bring it to a total envelope of 40 billion.
“This investment will support the construction of more than 30,000 new housing units across Canada, which will bring the total contribution of the program to more than 101,000 new housing units financed by 2031-2032,” details the 2023 economic statement. .
Along the same lines, the housing cooperative development program, which was announced in the 2022 budget, will be launched in 2024 and will receive an increase of $309.3 million.
Earlier this fall, the government announced the elimination of the Goods and Services Tax (GST) for new construction projects for rental purposes. From now on, this measure will also apply to the construction of housing cooperatives.
Canadian Mortgage Charter
To help mortgage holders cope with rising interest rates, the government established the Canadian Mortgage Charter. It sets out the obligations of lenders when their clients experience financial difficulties.
For example, banks will have to extend the amortization period of the mortgage if the borrower is no longer able to pay it after its renewal. The charter also limits the ability of banks to impose certain fees or penalties.
Most financial institutions already offer these possibilities to their customers in difficulty, but the government hopes that by including them in a charter, they will become systematic.
The Canadian Mortgage Charter
Canadians can expect financial institutions to:
- allow temporary extensions of the amortization period for subprime mortgage holders;
- waive fees and costs that would otherwise have been charged for the relief measures;
- do not require insured mortgage holders to re-establish their eligibility under the minimum insured eligibility rate when they change lenders at the time of mortgage renewal;
- contact homeowners four to six months before their mortgage renewal to inform them of their renewal options;
- give at-risk homeowners the option to make lump sum payments to avoid negative depreciation or sell their primary residence without prepayment penalties;
- do not charge interest on interest in the event that mortgage relief measures result in a temporary period of negative amortization.
Chrystia Freeland tabled the fall economic statement on November 21.
PHOTO: Ministry of Finance
Crack down on short-term rentals
Ottawa plans to release a fund of 50 million over three years, to support municipalities which “crack down on non-compliant short-term rentals,” says the document.
From 1is January 2024, Ottawa will deny tax deductions on all expenses received for short-term rentals.
“These companies are preventing too much housing from being available for our communities and cities across the country,” announced the Minister of Finance.
Support for post-secondary institutions
The federal government wants to protect post-secondary institutions in cases of insolvency to avoid a repeat of a financial crisis like that of Laurentian University.
After placing itself under the protection of the Creditors Arrangement Act in 2021, the bilingual establishment in northern Ontario abolished 70 programs, including 29 in French, and laid off around a hundred teachers.
Also read: Wild cuts at Laurentian University: what is Ottawa’s role?
The federal government will amend insolvency laws, namely the Companies’ Creditors Arrangement Act and the Bankruptcy and Insolvency Act, so that post-secondary institutions are not subject to prosecution in the event of restructuring .
Measures for journalism
The 2023 economic statement provides for an investment of $129 million over five years in support of journalism and $10 million for each subsequent year.
The annual ceiling on eligible salaries will increase from $55,000 to $85,000 per year and the salary tax credit will increase from 25% to 35% for a period of four years starting in 2024.
” The measure […] will benefit the Canadian news sector workforce, as well as people in communities where local news media are under threat, such as French-speaking and rural communities, by helping to ensure continued access to reliable local news,” reads the economic statement.
Despite these new announcements, the government is refraining from major spending and plans to maintain the deficit at $40.1 billion, as announced in the federal budget last spring.
Even though the economic outlook has darkened since the presentation of the budget six months ago, the cost of financing the debt has increased with the rise in interest rates and the government’s financial room for maneuver is reduced.
2023-11-27 14:06:18
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