Federal Finance Minister Chrystia Freeland is looking like a tight rope walker as she looks to tame housing affordability in the big cities in this country.
Ottawa wants to bring down the price of houses in Toronto but not so much as to cause a recession or to leave recent buyers with houses worth less than their mortgages.
So, she is going encourage first-time buyers with a new tax tool to help save for a down payment, except that tighter mortgage rules mean even this won’t get a purchaser to the minimum down payment threshold.
Then they’re banning foreign ownership for a couple years. The idea is to restrict the buyer pool – not really an issue in this region – but it will prevent American goose hunters from buying vacant houses in rural Saskatchewan for use as a private hunting lodge.
Finally, Ottawa will help urban authorities reduce the red tape and permitting issues so builders can actually get approvals to do their jobs. This might be most helpful of all as the issue has always been supply. Opening that up will do much more than restrictions.
