Finance Committee on Oct. 8th, 2025

[Ian Lee]

I don't believe so. I'll be very frank.

Again, I've lent money. There's the price of the home, and then, of course, they put the test on you on whether you have the minimum equity needed. Also, of course, you have to pass the income tests. On the total—pardon the jargon—the TDSR and the GDSR, which are the two income tests, if you don't have the income, you're not going to get the mortgage.

Having a tax reduction at your marginal tax.... Remember the bottom quintile. Again, this is C.D. Howe data taken from StatsCan, which is taken from CRA data. Just so everybody understands where StatsCan is getting the data, they're getting it from the filings of all the employers in Canada.

The bottom quintile is paying, I believe, 5% of total taxes in the country. That's a good thing. We're all in favour of that, but the point is that they're paying very—

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

I have another question, if I may.

[The Chair, Liberal, Karina Gould]

You have about 30 seconds.

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

I want to get Ms. Whitzman in.

We talk about how this bill will not help the people who need it the most to be able to qualify for a mortgage. I was 22 years in the mortgage business, so yes, the debt service ratios are not going to work there. That means people cannot buy a home. They need to rent, and now we see that rents are beyond the reach of these same people in the bottom income quintile.

I'll give you the last word, Ms. Whitzman, on affordability for renters.

[The Chair, Liberal, Karina Gould]

Unfortunately, Mr. Kelly, that is exactly six minutes, so Ms. Whitzman will have to answer that another time.

Mr. MacDonald, we'll turn to you for six minutes.

[Kent MacDonald, Liberal, Cardigan, PE]

Thank you, Madam Chair, and thanks to the witnesses.

I'll go to Mr. Lee first.

Welcome. You're familiar from your appearances on TV. I think you were commenting quite often on my evening news programs.

We were talking about housing costs, and I don't deny what you're saying, which is that the cost of land in large municipalities—that's one of the factors—has driven up municipal costs again. However, I'm reaching out as a representative of Atlantic Canada. I come from the agricultural sector. For many years, agriculture has been building with prefab products, prefabs out of factories. Obviously we're doing that because it expedites the process of building and brings costs down, overall, for transportation and that type of thing. In Atlantic Canada, we have a limited labour market, and transportation costs are a lot more.

I want your thoughts on prefabricated manufacturing of housing components in Canada. Could that accelerate building the housing that we need to do?

[Ian Lee]

I do appreciate the question. If you had asked me that a few years ago, I would have said no. I would have said that they're just mobile homes. I had a pretty negative view, and I did, full disclosure. I have come around partly because of the technological innovations in development of mobiles. They're not what they were 10 or 20 years ago in the technology. I actually went out and met a business in the city that is making them. When they're put together, it's very difficult to tell that they're prefab.

They've made enormous strides in the technology. I'm talking about the package of the technology and the materials. I think it's now viable and part of the mix for addressing the housing shortage.

[Kent MacDonald, Liberal, Cardigan, PE]

I'll go next to Ms. Whitzman.

You've spoken often about the need for consistent long-term federal leadership on housing. I wonder about our approach in this legislation, using tax policy to lower the costs—the GST, the income tax bracket reduction. Is this sending out a signal that we're taking a stand and that we're going to accelerate construction? What's your opinion on that?

[Carolyn Whitzman]

I would like to say a couple of things to begin with. The first is that my name is pronounced “whitesman”, and that I was a full professor before I retired in 2019, but that's neither here nor there. Also, I was on the federal industrial committee on homebuilding, so ask me about modular.

In any case, I think that the measures outlined in Bill C-4 are probably not the most effective measures either to get homebuilding happening again, Mr. MacDonald, or to ensure the affordability for all Canadians.

I think that Build Canada Homes has some promising directions. I would agree with Madam Lavoie, who spoke in the last session, about using Keynesian-type economic stimulus to get non-market housing. That in many cases works from less of an expectation of profit and more of an expectation of social mission, and that might be from investing in non-market housing, as Build Canada Homes is doing. It might be a more effective measure in terms of dealing with the absolutely disturbing number in housing starts and also in pre-sells for condominiums, which I can get into further if you wish.

[Kent MacDonald, Liberal, Cardigan, PE]

I'll apologize first for the mispronunciation.

Maybe you could weigh in on the prefab components as an instrument to accelerate housing.

[Carolyn Whitzman]

Land costs have gone up. There was a discussion in the last session about land costs. Keep in mind that land costs are going to be very different as a proportion, depending on whether it's a single-family home or an apartment building. An apartment building will be using land more intensively.

Both construction costs and labour costs went up during COVID and after COVID, and they will only continue to go up with the continuing trade stuff that's going on with the U.S. It's really important for Canada to develop its own homebuilding industry that takes the raw materials produced in Canada, such as lumber, steel or concrete, and creates finished products in Canada, as opposed to the current situation where well over 50% of materials come from the U.S. Quite often, raw materials are sent to the U.S. and then sent back in a final form to Canada.

I think that the industrial construction industry is a really promising direction. I think that the centre at UNB in Atlantic Canada is doing an amazing job of coordinating initiatives. That is one of the ways to bring down costs in a clear and relatively short-term way.

[Kent MacDonald, Liberal, Cardigan, PE]

Thank you very much.

[The Chair, Liberal, Karina Gould]

You have about 15 seconds left.

[Kent MacDonald, Liberal, Cardigan, PE]

That's not very much time. I'll cede that time to someone else.

[The Chair, Liberal, Karina Gould]

Perhaps I will also apologize, Dr. Whitzman, because I'm sure the committee members took their cue from me and my pronunciation. Thank you for clarifying that.

[Carolyn Whitzman]

No problem. I just thought I'd mention it at some point.

[The Chair, Liberal, Karina Gould]

It's all good. We like to appropriately address folks.

Mr. Garon for six minutes.

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

Madam Chair, in fact, I get six minutes and 15 seconds to speak.

I thank our witnesses for joining us.

Mr. Lee, you ended your opening remarks with policy proposals, but you didn't have time to finish. It reminded me of the days when the Conservatives were ahead in the polls, a long time ago, and when the leader, Mr. Poilievre, was touring Quebec and calling the mayors of our cities idiots and incompetent. He insulted everyone. He said that if we weren't building, it was the fault of Quebec municipalities, and that Ottawa should punish them by withholding money. I would like to point out that Quebec municipalities cannot do business directly with Ottawa, because it's against the law in Quebec.

Despite the fact that you didn't contribute to the Conservative platform, that was your proposal. Have I got that right?

[Ian Lee]

I won't deal with the politics. That's beyond my domain. I just deal with the data, the numbers.

Let me state something. It's very obvious. Every one of us knows this. The municipalities control the permitting, and they control the zoning. It's not the federal government. It's not the provincial government. It's right down at the end. Believe me, I've renovated my house many times. I've gone through the zoning process. I've gone through the permitting process.

In Canada, in the big cities, it's very bureaucratic. It's very delayed. The numbers are showing it. You can say, “Well, those are just big cities, and they should have a different comparator.” Yet, when you look at a city of the same size in the States—not even the same.... They're literally five times faster.

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

Mr. Lee, I understand you have renovated your house several times, and I respect your renovations.

The provinces are asking for infrastructure transfers. In Mirabel, in my riding, there is a water shortage. In municipalities along the south shore of Montreal, they're almost limiting the number of toilets per unit because they don't have the infrastructure.

Currently, the transfers to the provinces for federal infrastructure are so low that the Quebec government, because of the tariff crisis, had to advance itself the money to implement its infrastructure plan. Quebec's credit rating was downgraded as a result. The same thing happened in four provinces. The money is here in Ottawa, but infrastructure transfers are being cut.

I'm being political because that's what we do here, and that's what you do indirectly. People say the provinces are incapable of doing their job and blame the permits. However, when there's no water, when infrastructure is outdated, when Ottawa's coffers are empty, when our rating gets downgraded, when provincial rates are increasing and we're unable to build, it's not because of the permits. The permits aren't responsible for the lack of water, Mr. Lee. I'm sending this message to the government too.

We need a program to renew a single, unconditional infrastructure transfer envelope. Some people say we should punish cities for their incompetence. Where do you want to make cuts? I say this to the Conservatives too, who sometimes say such things. There's no more money in the infrastructure fund. Where are you going to make cuts to upset the provinces and upset the cities? I'm sending the message. This isn't a question, it's a political message.

I'll now turn to Ms. Whitzman.

Ms. Whitzman, there's a lot of talk about affordable housing. The definition of affordability means a household should not pay more than a certain percentage of its income for housing. However, I'm no expert on this subject. When I look at these amounts, they seem considerable to me. Sometimes I even wonder how families are able to make ends meet. Quebec employs a social housing model. We have co-ops and all kinds of management models to give households access to housing at a reasonable price.

In your opinion, what will the future models of social housing be? Can the non-market approach be effective in limiting speculation in our cities?

[Carolyn Whitzman]

My apologies, I'm going to respond to your questions in English.

For a long time, Quebec was absolutely a leader in Canada. It had the lowest rates of homelessness. It had the lowest rates of core housing need. That's changed. It's changed for a couple of reasons. One is that people are running to Montreal and to other parts of Quebec because of unaffordability in other parts of Canada. Rents have gone up 72% in Montreal in the last five years.

There's one possible approach, which comes from France. In the year 2000, the national government set non-market housing targets of 20% for every municipality. They were increased in 2016 to 25%. Paris has voluntarily taken on targets of 30%. It's not just the federal targets. It's also a great revolving loan fund, which I'd be really happy to talk about at some point. It's also a lot of money for acquisitions, such as a rental protection fund, which is just now getting started in Canada but has had a huge impact in British Columbia.

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

There is, for example, the right of first refusal. When buildings are put up for sale—

[Carolyn Whitzman]

Yes, and Montreal has been doing great things with pre-emptive housing rights, absolutely. These are all promising directions in terms of housing that's affordable to low-income, moderate-income and middle-income people.

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

Madam Chair, I'll cede my remaining time to the next speaker.

[The Chair, Liberal, Karina Gould]

All right.

Ms. Cobena, we'll go over to you, please, for five minutes.