Canada’s housing challenges are finally prompting much-needed discussions on potential modifications to the Liberal government’s immigration goals.
In a recent interview on CTV’s Question Period with Vassy Kapelos, Canada’s housing minister Sean Fraser took some time to finally elaborate on the big picture, where he says he’s keen on aligning immigration policies with community capabilities like housing, health care, and infrastructure. Which, in layman’s terms, means: Let’s not invite people over without enough chairs, right?
Although Fraser finally conceded that it may be time to review the temporary immigration programs, which operate based on demand without a cap, he didn’t think there’s a pressing need to decrease the number of newcomers obtaining permanent residency annually. In fact, nearly half of these permanent residents often have prior experience living in Canada as temporary inhabitants, he explained.
But, any modifications to the system requires extensive consultation, as decisions around which institutions accept international students fall under provincial jurisdictions. Moreover, these institutions also play a significant role in accommodating the newcomers. While there’s talk about capping foreign student numbers to alleviate housing woes, Fraser’s heartstrings seem to pull towards welcoming many of them, citing the broader benefits. In his eyes, these students aren’t just cramming for exams; they’re the potential future Canadians.
As such, Fraser emphasized that discussions concerning the housing crisis shouldn’t be limited to the sphere of immigration, and instead he suggests the focus should be shifted to boosting housing supply.
Recall, In November 2022 while he was Canada’s immigration minister, Fraser set the immigration goalpost high— 465,000 permanent residents for 2023, 485,000 for 2024, and a whopping 500,000 for 2025. He articulated that these numbers were vital for maintaining Canada’s economic vitality by addressing labor shortages and ushering in vital skills in pivotal sectors like healthcare, manufacturing, and technology. But, now that he’s been appointed the housing minister, he’s realized that his previous policies aren’t quite harmonious with the country’s housing landscape.
Indeed, critics ranging from academics, financial institutions, and policy makers to opposition politicians, have repeatedly raised such concerns, arguing that this high-octane immigration approach is worsening Canada’s housing crunch.
A report in July by TD economists predicted that persisting with the current immigration strategy could escalate Canada’s housing deficiency by about half a million units within two years. Additionally, the Canadian Mortgage and Housing Corporation has projected a need to construct 3.5 million additional homes by 2030 to make housing more affordable, a goal Canada is lagging behind.
While Fraser seemed reluctant to cap the number of international students coming into Canada, he did offer some ulterior solutions to easing the housing crunch. In a separate interview with CBC, some of the ideas the housing minister is considering are tax incentives to motivate builders, low-cost financing schemes, and possible removal of the Goods and Services Tax (GST) from affordable housing projects. Furthermore, he’s contemplating dedicating federal lands exclusively for rental housing purposes.
Information for this story was found via CBC News and CTV News. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
