Evidence of meeting #68 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was changes.
A video is available from Parliament.
6:45 p.m.
President, Canadian Home Builders' Association
The GTA is the recipient of a lot of immigrants. A lot of people are competing for the same piece of land, so the price has gone up exponentially in the last—
6:45 p.m.
President, Canadian Home Builders' Association
There isn't more land, in our case, because of provincial and local policy on land supply.
6:45 p.m.
Conservative
6:45 p.m.
President, Canadian Home Builders' Association
It has dramatically decreased.
6:45 p.m.
President, Canadian Home Builders' Association
The reason is that the provincial government decided to jump into the land planning process in a much bigger way, and by doing so basically stopped the normal series of events for about a decade.
6:45 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Government regulation, fees from the time you have a raw piece of land to the time the key is handed to the owner, the house is finished, and they're moving in....
6:45 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Government fees, regulations, taxation, regulatory schemes, etc., what percentage of the price of the house, on average.... I've heard some different averages. We've had different groups come in front of this committee, and other committees over the years, and tell us it's a different amount.
Could you give me a sense of what an average might be?
6:45 p.m.
President, Canadian Home Builders' Association
Maybe I can look at it a different way. Five years ago, for a product I'm delivering today, the land and the fees and everything else would have probably been $300,000 less than what I'm delivering today. If it was an $800,000 house, I could have delivered that house for $500,000 five years ago.
6:45 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
You're talking about a $300,000 increase in government-imposed regulation, taxation, and fees in the course of five years in the Toronto market.
February 1st, 2017 / 6:45 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
This is astounding to me, because all three levels of government, including this level, don't seem to understand. They see you as a rich builder, rich developer, making all kinds of money because you're selling houses. I've been there. I've been at council meetings. I've seen it. I've seen it at the provincial level and I've seen it federally as well. They think that housing, new homes especially, can be a cash cow because it's hidden. Nobody out there, other than the home builders in each community, is speaking up about it.
I would suggest to you one of the affordability problems we have in this country—and I want to know whether you agree with me or not—is the fact that there are more and more government-imposed costs and across-the-board fees, regulation, taxation, etc., especially development charges. I heard of one development charge, tell me if this is correct—I believe it's Markham or one of the GTA communities—that's $56,000 per unit.
6:45 p.m.
President, Canadian Home Builders' Association
In the Brampton and the Caledon area now, we're looking at $85,000 to $90,000.
6:45 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
That's $85,000 to $90,000 a door. That's just development charges.
6:45 p.m.
President, Canadian Home Builders' Association
That's just development charges.
6:45 p.m.
Conservative
6:45 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Okay. You know where I'm going here, because I'm getting quite excited. If we want to address the affordability problem, let's address what's causing the huge increase in housing costs, which in large part is government-imposed at three different levels, and this is one of the levels we're dealing with here today.
We're probably, as the federal level, the smallest slice of that piece of the pie. But the reality is that every time you add $1,000 to the price of a house, 6,000 more Canadians can't buy. We wonder why we have a housing problem in this country, why we have people lined up for social housing who can't afford their first house.
Now in your business in the Maritimes, it's interesting.... Thank you for coming, by the way.
6:50 p.m.
Chief Executive Officer, Nova Scotia Home Builders' Association
Thank you very much.
6:50 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
It's nice to meet you.
You were describing a situation where you've had to lay people off as a result of your business not having these things, because of some of these changes and other changes. What is the single most important thing, in your mind, in terms of affordability?
6:50 p.m.
President, Nova Scotia Home Builders' Association
Even in little old Halifax about 27% of our home prices are taxes, development charges, levies, and water and sewer fees, so we're on the low end compared with Toronto, but we still have quite a bit of fees and taxes.
I would say right now we don't have any buyers entering the market. As a real estate agent, I sell to first-time homebuyers, but as a builder, I can't necessarily build anything that could accommodate a first-time homebuyer price-wise because of the cost of land and things like that.
We have nobody entering the market buying Bob and Mary's bungalow so Bob and Mary can move into their dream home that Tamara built them. We have nobody entering, so the choo-choo train chugs along, and then we sell Bob and Mary a new home, and then the people who were in this home move out and buy a condo, and retire happily in a condo. We have nobody going into the market.