Thank you, Mr. Chair.
Adam, you'll be happy to know that in our organization we hired five students this summer because we can use students, but also because I strongly believe that we have to give opportunities to students during the summer.
I am pleased to be here on behalf of 130,000 realtors who live and work in every community across Canada.
I would like to start by recognizing the government for acknowledging the social and economic importance of home in budget 2019. At the Canadian Real Estate Association, our role is to advocate on behalf of homeowners, homebuyers and home sellers. We support policy efforts to secure the entire housing spectrum, from emergency shelters to rental housing to ownership. All Canadians deserve safe and secure shelter.
Two years ago, the government launched the first-ever national housing strategy to help give Canadians a place to call home, and we strongly support the budget 2019 efforts to make this a permanent and ongoing effort. Long-term investments, such as the rental construction financing initiative, will help move people along the housing spectrum from social housing to rental apartments and into their own home.
Turning to ownership, it is clear that it has become more difficult for first-time homebuyers to accumulate enough capital for a down payment, as incomes have not kept pace with housing prices. Last fall, realtors met with many of you to highlight the concerns of millennials anxious to buy homes, but this anxiety applies to many first-time homebuyers, including millennials, small business people and new Canadians, so helping Canadians with a down payment through the first-time homebuyer incentive is positive.
The initial $1.25 billion in grants could, according to our estimates, help some 100,000 Canadians. The plan will encourage new home construction, which we consider critical given housing supply issues in many parts of the country. We look forward to getting more details about this shared equity program. Realtors are anxious to know more so they can encourage their clients to make use of the program to fulfill their home ownership dreams.
Another key program is the the homebuyers' plan, which allows a first-time homebuyer to access their RRSP for a down payment on their home. It has helped over 2.9 million Canadians purchase their first home. The homebuyers' plan is a program born of realtors' advocacy efforts in the 1990s, so we were pleased that budget 2019 included an adjustment to the plan by raising withdrawal limits to $35,000. One-quarter of all withdrawals were maxed out at the previous limit of $25,000. A higher limit will help people achieve home ownership with less debt.
We know that Canadians work hard to get into their first home, but significant life changes can compromise their ability to maintain the family home. The extension of the program to Canadians who experience a marital breakdown, allowing them to use their RRSPs to maintain home ownership, is great news. This compassionate measure has the potential of helping 25,000 Canadians every year during a difficult period in their lives.
Other initiatives in the budget that we consider promising include the housing supply challenge and the review of housing supply and affordability in British Columbia.
Finally, we are encouraged by a line from the budget document that reads, “The Government continues to closely monitor the effects of its mortgage finance policies—including the stress test for insured mortgages—and would adjust them if economic conditions warrant, to support access to housing while safeguarding financial stability.”
This vigilance is critical, as we know that the impact of the stress test, especially on housing markets that were already in balance or in distress, has been significant. B-20 rules have sidelined many potential homeowners. For example, a buyer in Moncton needs to save about $28,000 more for a down payment on a single family home after the implementation of the stress test. ln Edmonton, with a benchmark price of $380,000 for a single family home, a first-time buyer would need to save an additional $60,000 toward their down payment.
We understand Canadian regulators are laser-focused on measures to lower household debt and limit the risks to our financial system. At the same time, we believe and support financially responsible home ownership. We don't think those two goals are incompatible.
No single measure will address housing affordability. While budget 2019 has many positive initiatives, we will continue to advocate for additional policy innovation that is coordinated across all levels of government and executed in partnership with stakeholders in the housing sector.
As you return to your ridings in a few weeks, I think you will find your constituents expect nothing less from us all.
Thank you for your time. I'd be happy to answer questions.