'Absolutely nothing' in federal budget for average and first-time homebuyers

Make homeownership and affordability a national priority.

Reduce taxes, fees, levies and development cost charges.

Ease the mortgage stress test and downpayment rules.

And, expand the GST rebate to all new home buyers and renovations.

These are four immediate and impactful actions the Central Okanagan branch of the Canadian Home Builders' Association wanted in last week's federal budget.

It was sorely disappointed.

"There is absolutely nothing in the budget that would help not only first-time homebuyers but any buyers trying to get into the market at any level," said Cassidy deVeer, executive officer of the Central Okanagan branch.

"What we were hoping for is something that would help restore consumer confidence."

Instead, the budget offered only stalled policy and an absurdly expensive Build Canada Homes subsidy program, according to deVeer.

deVeer discussed last week's federal budget and its failure to support affordability and homeownership for the next generation with KelownaNow video host Jim Csek.

"The federal government continues to claim it's tackling the housing crisis while leaving out the very people who can fix it," said deVeer.

"Builders in the Okanagan were hoping for action that would get projects moving, restore affordability and give families a fighting chance. Instead, this budget gives us recycled headlines and no solutions."

The 'recycled headlines' deVeer referred to is the GST rebate for first-time homebuyers, an announcement that was made months ago, however, it was touted in the budget.

The rebate has not received Royal Assent, so no one is getting the break, yet.

deVeer said the housing industry is calling not just for the immediate Royal Assent for the GST rebate, but that the rebate be extended to all buyers and home renovations (like secondary suites and carriage homes) that will create affordable new units.

In Kelowna, the selling price of a typical single-family home is just over $1 million, a townhouse $700,000 and a condominium $490,000.

Prices are only higher for new construction.

As such, homeownership has become unattainable for many and a privilege only for those who bought years ago when housing was cheaper, the rich, those who sold a property they had huge equity in and those who are given money by the bank of mom and dad.

Home builders are also critical of the federal government's new flagship program -- Build Canada Homes -- that's hailed by Ottawa as an innovative solution.

The program focuses on subsidized housing on federal lands and allocates $13 billion for 4,000 homes.

That works out to $3 million per home, an approach that's shockingly inefficient, insufficient and costly, according to deVeer.

"This is not a housing strategy, it's a photo op," she said.

"It does nothing for the Central Okanagan, which has no federal land available for development aside from the old army barracks in Vernon."

Last week's budget -- Mark Carney's first as Liberal prime minister -- is a marked contrast to the 2024 document, which was known as 'The Housing Budget.'

Home builders feel Carney abandoned the momentum created by the 2024 budget.

Last year's budget bumped the maximum amortization for a mortgage from 25 to 30 years in an effort to make monthly mortgage payments more affordable, albeit lasting five years longer.

Home builders (and potential homebuyers) wanted more in this budget, but didn't get it.

Things like easing the stress test (which requires homebuyers to qualify at higher than current mortgage interest rates); reducing down payments; putting the $13 billion Build Canada Homes money instead into a down payment program for regular Canadians; cut government taxes, fees and levies (which take up 30% of the cost of a home); cut provincial sales tax on essential building materials (which are taxed like luxury and vice items such as tobacco); and reduce park development cost charges (which can add $15,000 to the price of every new home in Kelowna).

Unaffordability has helped lead Kelowna into a big-time construction slowdown.

Construction, which has been Kelowna's largest economic generator for the past few years, is struggling with total building permit values dropping more than 80% from $279 million in September 2023 to $45 million in September 2024.

As such, deVeer labels the federal government's target of 550,000 new homes per year in Canada to meet demand as unattainable because the current rate is 236,000 a year and the highest ever was 272,000 in the late 1970s.

_{Thumbnail photo credit: Realtor.ca}