Finance Committee on Oct. 6th, 2025

[Richard Lyall]

I certainly wouldn't have any objection to that happening.

If you look at it, in fairness, people aren't really that conversant with some of these tax issues and how the dates apply and whatever. If you heard that, you may have thought, “Oh, I'm going to get a tax rebate here”, but then it didn't happen, because the date was May 27.

Saying that, I also accept the fact that setting those dates is a difficult choice, because you're drawing a line in the sand somewhere, but if they were to move it back, I wouldn't have an objection, personally. It's kind of fair.

[Jean-Denis Garon, Bloc, Mirabel, QC]

In your industry, have you ever heard from contractors, businesses or builders who told you that some of their clients had later learned that their purchase did not qualify for the GST rebate? Have cases like this been reported to you?

[Richard Lyall]

I wouldn't say that specifically—well, yes, but the bigger issue has been the alignment with the province. Our members have had repeated calls asking, “When can I get it, and what does it cover?” We have said, “Well, the province will be acting on this”, but that hasn't happened yet. There are some challenges around this. This is the difficulty, I think, in our country with the alignment of policies between the various levels of government. That, of course, raises questions of accountability, which are so important.

However, on housing, I think your point is that we need clarity, and there has to be some consideration given to some buyers not really understanding the system.

[Jean-Denis Garon, Bloc, Mirabel, QC]

You're talking to a Quebec separatist. I completely agree with you that there are too many levels of government in this country. You and I can agree on that.

Has your organization done an assessment of the cost to the federal government of the proposed date change for the retroactive application of the first-time homebuyer GST rebate? I know that the Association des professionnels de la construction et de l'habitation du Québec has done so. Have you calculated it as well?

[Richard Lyall]

I think one estimate I saw was something in the range of $60 million, and then, of course, there have also been estimates of extending the GST break to move-up buyers, downsizers and things like that. Those numbers have been calculated as well, both at the provincial and at the federal level, but specifically to your question, I think it was about $60 million.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Ms. Keesmaat, in recent years, a number of programs have emerged that are aimed at enabling young people and first-time buyers to acquire a property, given that property prices have increased significantly, as we know. For example, the FHSA, or tax-free first home savings account, was set up. There was also the first-time homebuyer measure that we talked about today.

However, when we look at statistics from the Canada Mortgage and Housing Corporation and Statistics Canada, we see that, since the pandemic, a very high proportion of first-time buyers have received money from their families, particularly their parents or grandparents. Young people who come from families with enough capital are privileged. For someone who has less money and comes from a more modest background, it is harder to put money into an FHSA and to have enough of a down payment to buy a property.

During the election campaign, the Bloc Québécois proposed that the federal government offer an interest-free loan to some young people to cover part of their down payment. That way, the children of parents and grandparents who have a lot of capital aren't the only ones who can buy a first home, even with the current programs.

Do you think that's an avenue the federal government could explore?

[The Chair, Liberal, Karina Gould]

Ms. Keesmaat, you have about 20 seconds.

[Jennifer Keesmaat]

Thank you very much for the question.

The challenge, any time you're actually helping people on the demand side and putting money in their pockets, is that the cost of housing is in fact increasing. I think the only solution is on the supply side—more supply and building more affordable housing that is targeted specifically to young people. Our Merton project is a good example of this. The affordable units—there are about 150 of them, 30%—will be at 50% below market rent.

Putting more money in people's pockets drives up the cost of the home.

[The Chair, Liberal, Karina Gould]

Thank you, Ms. Keesmaat.

I'm going to have to move on to the next round of questioning.

Mr. Kelly, you have five minutes.

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

Thank you.

Mr. Lyall, in your opening statement and in your responses to earlier questions, you mentioned, more than once, taxes being the obstacle or the principal driver of the cost of housing. The GST is one, and we do support the removal of it. We agree with you that the government could have chosen to go further.

What about other taxes? There's an industrial carbon tax that affects the cost of producing raw materials. If you want to talk more about development charges, the committee, I think, would like to hear some more details about how taxes make housing more expensive.

[Richard Lyall]

Sure. I'll start with DCs. Development charges basically became, certainly in Ontario, a runaway train. Now there are some disciplines being imposed on them, most recently with Bill 17 in the Ontario legislature, but it's still an issue. They rose dramatically, without real justification.

There needs to be a new system in order to support growth-related infrastructure and things like that, aligning the three levels of government. There are some measures there that are being contemplated. I like Alberta's attitude. Alberta's Minister of Municipal Affairs, Dan Williams, says housing is priority one, and all other considerations are secondary.

Within that context, I can't in principle support any kind of taxes, including carbon taxes, relative to that number one priority for housing supply, because it's so fundamental to so many of our needs, whether it's health care, education or our ability to compete with the U.S. Yes, I'm all in favour of cutting taxes on new housing, whatever they are.

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

Then the industrial carbon tax, for example, is yet another example of how taxes—in this case, a tax completely under federal jurisdiction—make housing more expensive.

[Richard Lyall]

To the extent that it drives up the cost of housing, yes, I'd support that proposition.

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

You mentioned in your opening statement that a number of municipalities got an “F” for their contribution to the cost of housing in the form of policies that hinder development and cater to the Nimbyism within their jurisdictions. You gave one example of costs, I think in the city of Toronto, going from $8,000 to $88,000 per unit.

Can you give some other examples, just so the committee has concrete numbers that Canadians can get their heads around for just how much government adds to the cost of a home?

[Richard Lyall]

Yes. For example, that was in the GTA, and I'd be happy to provide further information after this session if required.

We've looked at different municipalities. Some have adjusted. In the city of Vaughan, Mayor Del Duca recently cut their DCs in half. They're still quite high, but at least that measure was taken, because we weren't selling anything anyway, so they had nothing to lose. Mayor Parrish, in the great city of Mississauga, produced a great housing plan and cut through DCs as well.

Some municipalities didn't jack up their DCs to that extent. In fact, I've received calls from them saying, “Hey, we're pretty good”, and they were. They didn't get carried away with this stuff.

I think that's one of the problems, though: You have these freaky jerky differences between different municipalities. This is where, again, I like the Alberta approach, which is to say that if a municipality is way out of line, the government is going to step in, because municipalities are creatures of the province. We need that kind of standardized approach across our provinces.

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

I don't think I have time for another question. I'm going to ask the witness to table the information that he mentioned he has access to, which could give more information to the committee.

[Richard Lyall]

Yes.

[The Chair, Liberal, Karina Gould]

That's great.

Thank you, Mr. Kelly. You were right on time.

Next is Mr. Leitão.

[Carlos Leitão, Liberal, Marc-Aurèle-Fortin, QC]

I see that Mr. Cape is back with us.

Before I turn to him, I would like to thank Ms. Keesmaat and Mr. Lyall.

You remind us over and over again that this issue is really a supply-side issue. We have to make sure that we find ways to build as much as we can and as fast as we can. Measures that work only on the demand side would in fact likely be counterproductive at this stage.

Mr. Cape, thank you for coming back. My question is this: In this context of having to work hard on accelerating construction, how do you view non-market housing? You mentioned the Swedish example. How do you view that as being appropriate for Canada at this time? We've done it before, after the Second World War. How can we accelerate non-market housing?

[Geoff Cape]

Thank you.

I apologize for my technical difficulties. I guess something went down in the neighbourhood, but we're back up.

Yes, on non-market housing, the critical importance of affordable housing in Canada has never been more pronounced. It's a challenge that right now is being felt around the world in different communities, but here in Canada it seems to be particularly important and stressed.

The various not-for-profit organizations leading in this space in different communities across the country all have strategies and a high degree of capability to operationalize the delivery, maintenance and management of affordable housing programs.

For us in Canada, our focus as a company has been working with not-for-profit agencies. We've worked with four indigenous organizations and I think four or five different not-for-profits in the GTHA. Each and every one of them is looking to massively increase the availability of their particular solution in their communities.

The question you're asking, I think, is more regarding how we create a higher degree of affordability. Is that what you're really getting at?

[Carlos Leitão, Liberal, Marc-Aurèle-Fortin, QC]

Yes, that's right.

[Geoff Cape]

It's an enormously complex question, with more than one particular tax solution required. Obviously, the GST relief being proposed is important in the mix, but there's a larger supply chain network that needs to be designed. There are critically important investments required at all levels of government to try to incentivize different ways of building in Canada.

The modular focus, the idea of increased levels of completion off-site in factories, has proven to be dramatically successful in Japan and northern Europe, with a particular focus in Sweden, where over 90% of all housing is produced off-site in fabrication facilities, producing a higher-quality product much more quickly and at a lower cost. We believe that Canada has all of the ingredients to make that same success, if not globally lead in that particular space.

There have been challenges, of course, in trying to roll out affordable housing programs related to modular housing and industrialized construction. These ideas have been tried over the last five decades or more. Uniquely right now, though, technology infrastructure is being designed, whether it's digital platforms and digital innovations or in the realm of robotics and machine learning, as well as supply chain development and policy integration. All of these things are beginning to coordinate to create a unique opportunity right now for these efficiencies to be properly put together by companies like ours at Assembly across the country in different communities.

The opportunity for faster builds, higher-quality builds and lower-cost production of housing, with a focus on affordability, is real. There's no doubt in my mind that the Build Canada Homes initiative that was announced by the Prime Minister and the housing infrastructure minister on September 14 is heading in the right direction. That type of investment is not just about affordable housing, but also about building an industry in Canada. Economic development is the parallel opportunity for that particular focus of Build Canada Homes.

I'll leave it at that.

[Carlos Leitão, Liberal, Marc-Aurèle-Fortin, QC]

Thank you very much.

[The Chair, Liberal, Karina Gould]

Mr. Leitão, you have about 10 seconds.

[Carlos Leitão, Liberal, Marc-Aurèle-Fortin, QC]

Well, thank you.