Mr. Speaker, I am happy to be following my colleague from British Columbia on this debate. As many members will know, this is my second Parliament and I have been talking about housing for two Parliaments now.
I was a big critic of the first-time home buyer incentive. The member for Spadina—Fort York and I traded barbs over it on the floor of the House. We disagreed over the initial program goals that were set out. I said from the very beginning that the program was going to fail, and it failed. It failed first-time home buyers and it failed Canadians, regardless of the housing market they were in. There is no such thing as a Canadian real estate market: There are housing markets all across Canada. It failed people in Toronto, it failed people in Vancouver and it failed people in my home community of Calgary. It was going to fail from the beginning. It was an election gimmick to try to get re-elected. It was rolled out two months before an election, and it was not going to succeed.
There is a lot in this opposition day motion I could speak about, but I want to focus on housing specifically and the simple law of supply and demand. There is not enough supply and there is a heck of a lot of demand. I am one of those homeowners who recently sold his house and now I am renting. I got out of the housing market because it is so red hot right now with everybody trying to get in, not just in the city of Calgary but all across Canada.
The first-time home buyer incentive was originally supposed to help 100,000 Canadians. I have been doing Order Paper questions and I have been doing access to information requests and releasing them to the public so people could see this. I have been criticizing the government on podcasts, in interviews and in op-eds I have written for the Postmedia Network.
I think 10,000 applications have been approved. “Applications approved” does not mean that the person who applied actually went through with seeking the loan. The two are fundamentally different. It is less than 10% of what the Liberals were supposed to achieve with the first-time home buyer incentive and the shared-equity mortgages they were trying to sell. I have read the operational manual that CMHC put out for brokers to use. It is an abject failure in delivery, and it is failing two years afterward.
The reason I bring it up is because I hear the same thing from constituents. The Liberals have had years to try to address the housing shortages across Canada. They have been wasting time, playing at the edges and coming up with these gimmicky programs to try to deal with issues that are very local in many situations. People look at postal codes in major cities when trying to buy a home because they want to be in a specific school district for their children. People look at how close homes are to transit in order to get to where they need to go.
During this pandemic, we have also seen that a big premium is now being placed on being able to work from home and having solid home Internet and Wi-Fi connections. I have caucus colleagues in major urban areas, some of whom are on the Zoom call right now, who have difficulty joining our calls while having their video on because their connections are poor in major urban areas.
That is how people shop for real estate. They look at price and they look at location. It is hyper localized. They cannot compare real estate from two extreme edges of the suburbs of Toronto. It is the same thing for Calgary. In the southeast corner of the city, where I live, and the northwest corner of the city, two very different housing markets exist. In northwest Calgary, people have to take into account that they are going to get damaging hail. In the southeast part of Calgary, that is going to happen way less often.
The reason I like so much of what is in this opposition day motion is because we are addressing some of the fundamental concerns Canadians have. We are calling for the government to really look at things like doing away with the first-time home buyer incentive. It is a failed program. It has already failed. The Liberals keep trying to change it. It is never going to work, so they should just abandon it.
The motion is calling for things like anti-money laundering efforts. Especially in markets like the Lower Mainland and parts of British Columbia, but in other parts of the country too, money laundering is having a local impact on certain types of housing.
We need a more defined debate. There are different market segments. For single-family detached homes, the prices are going up a ridiculous amount. I want to talk about asset price inflation in a broader way in a moment. With respect to condos and townhouses, condo prices have been going down all over Calgary because the City of Calgary approved a whole bunch of building permits over the past two years. A lot of supply is coming onto the market and there is way less demand.
There is an immense amount of demand now for single-family detached homes and even duplexes and townhouses. People are moving up into the market real estate space because they want to be able to work from home. They have children.
I am one of those parents who is doing virtual home-schooling this week, so I have my kids at home. They are being very quiet and very good right now so I can address the House and speak about my constituents who are being impacted by the gimmicky plays of the Liberal government in addressing fundamental market issues. There is not enough supply coming on and there is too much demand.
Let us talk about asset price inflation. The super low interest rates are driving not only a lot of speculative buying, but just plain buying by people who see an opportunity and are looking after their self-interest better than the government can. They see an opportunity to buy into a market they could not buy into before. I have seen chartered banks offering less than 1% interest rates for a five-year mortgage, which is a standard mortgage in Canada. Who can compete with that? Prior generations could only dream of it. My uncle, who has a home in Markham, used to talk about paying 18.5% interest in the 1980s. I have a hard time convincing young Canadians this is going to happen and I am a millennial, one of these old millennials who is turning 40 this year.
The unbelievably low interest rates today are also driving people to compete for a limited amount of supply in many markets across Canada. The government has created gimmicky programs, like rental programs. One of its programs proposes to allocate billions of dollars to support the construction and repair of 35,000 affordable housing units, but a Canada housing survey in 2018 said that 9% of Canadian households, which is 1.3 million, had purchased a home in the five previous years. The Liberals are talking about tens of thousands of units, but that is not enough. They should go big: way bigger than they are talking about here. I have heard Liberal MPs say that they will go bigger and they have, with over $600 billion worth of spending. This is still not enough, because the fundamental issue is market supply and demand with extremely low interest rates driving people into the market.
That brings us to the next problem, which is that incomes have not kept up with asset price inflation. A young family may try to put money aside to save for a 5% down payment. The asset price on the single-family detached home or townhouse it is looking at exceeds its ability to save every single month and year. As the family tries to put a nest egg aside for a down payment, the asset price of the home goes up faster than it can save. That is the problem for young people and young families today. The member who spoke previously, my colleague from British Columbia, has two daughters who are in exactly this type of situation. They cannot save fast enough to make up the difference in the price of housing today, which is being driven up by super-low interest rates and these gimmicky plays from the Liberal government. and their ability to save due to their incomes.
The Liberals are raising income taxes. They have increased carbon taxes. They are nickel-and-diming Canadians all across the country. I live in a province that did not want a carbon tax and was stuck with it, because that is what the federal Liberals decided was the wisest course of action. It has an impact on the ability of people to save for down payments.
I have been a big critic of the Canada Mortgage and Housing Corporation, which wasted millions of dollars trying to rebrand itself as “housing Canada” instead of focusing on its core business, which should be providing a mortgage insurance product. Its rates are too high. It is in the Public Accounts of Canada that it has been paying the federal government every single year while charging premiums on first-time home buyers in order to make up the difference.
I have a Yiddish proverb for the consideration of members who are paying attention to this debate: “You can make the dream bigger than the night.” The Liberals have dreamt big, really big, with all of these gimmicky programs. They have tried to solve a market problem with even more government, so that every time a program does not turn out there is even more government and another government program, or it is fiddling at the edges of a government program that exists to try and fix it.
The fundamental reality is this. Young people cannot save fast enough to get into the hottest markets such as Toronto, Vancouver, Victoria, Calgary and Edmonton. The asset prices are out of control and people cannot save fast enough. Much of what we propose in this opposition day motion will address that. I am so glad we have put if forward. I have been speaking about housing for years and trying to get the attention of the federal government away from its gimmicks and onto real solutions.