SoVote

Dec/9/21 1:10:03 p.m.
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Madam Speaker, I am sensing some writer remorse over on the other side. If you do not like it and you want to keep the parks open, then my suggestion to you is to delete paragraph (a). While you are deleting paragraph (a), please—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Dec/9/21 1:10:17 p.m.
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I will remind the hon. parliamentary secretary that I did not write anything.

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Members' remarks

Mr. Kevin Lamoureux

Dec/9/21 1:10:23 p.m.
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Madam Speaker, I should know better. My advice for the Conservative opposition members would be to delete paragraph (a) and then they do not have to worry about taking away parks from Canadians. While they are doing that, please delete paragraph (c) as well, because paragraph (c) says “commit to never introducing a capital gains tax on the sale of primary residences.” That is just a silly thing to say, because we have been saying that for a long time.

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Mr. Mark Gerretsen (Parliamentary Secretary to the Leader of the Government in the House of Commons (Senate), Lib.)

Dec/9/21 1:10:47 p.m.
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Madam Speaker, if the member for Central Okanagan—Similkameen—Nicola is curious about why we are talking about 41 million hectares of land, he should really go back and pay closer attention to the speech given by the member for Edmonton Riverbend. He is the one who started with this number earlier today. I will go back to another comment from the member for Edmonton Riverbend. He accused me, in my previous role as a municipal politician, for not building enough affordable housing, as if to say it should have been the responsibility of city councils across the country. Here is the interesting thing: When I was on city council, the Ontario provincial government was investing in affordable housing and housing more generally in Kingston and throughout the province. Who was not? Stephen Harper. The member has been around for a while. Could he reflect on Stephen Harper's legacy as it relates to affordable housing?

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Mr. Kevin Lamoureux

Dec/9/21 1:11:38 p.m.
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Madam Speaker, that is one of the reasons I was surprised to see the motion. I sat in opposition when Stephen Harper virtually ignored the housing issue. In my comments, I made reference to the fact that all levels of government have an important role to play when it comes to housing in Canada. That is why I am very proud of the fact that for the first time in generations, we have a Prime Minister and a national government that recognizes that importance and has not only put the money on the table, but is working diligently with organizations and different levels of government to improve our housing stock and supply.

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Mr. Pat Kelly (Calgary Rocky Ridge, CPC)

Dec/9/21 1:12:27 p.m.
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Madam Speaker, I will be sharing my time with the member for Carleton. I am pleased to rise in debate today to talk about today's opposition motion. Prior to 2015, I was in the mortgage brokerage industry. I spent 21 years in the residential mortgage brokerage business, so access to housing, home ownership and mortgage credit are issues that have been dear to me for many years and are also dear to my constituents. There is clearly a crisis in affordable housing in Canada, and in affordability generally in Canada. The average home price is now a staggering $717,000. Even if we subtract Vancouver and Toronto, the average is still $561,000 across Canada. People have generally thought for a long time this is a peculiarity to two markets, maybe even especially Vancouver, but it is no longer the case. Affordability is a crisis across Canada. The average weekly wage is just over $1,000, so if the average worker saved 10% of their wages, it would take them almost 10 years just to save enough for the minimum down payment on the average house in Canada. Even that would be futile, though, because at that income level they would not come even close to qualifying for the nearly $700,000 in mortgage debt they would need to take on to buy this average house with this average weekly wage. Generations of Canadians have achieved a degree of financial security and independence through home ownership by buying a home probably around the time of family formation and then paying it off over a generation. Today's young people have simply given up on that dream. As with all questions of people's unlimited wants and needs, this really is a question of supply and demand. Canada's increasing population has always fuelled demand for housing, but since this pandemic, Canadian interest rates have been artificially suppressed through quantitative easing, wherein the Bank of Canada buys the Canadian government's debt in order to facilitate the staggering national deficits triggering inflation. This inflation is nowhere more obvious than in our housing market, where we have seen an extraordinary increase in the price of real estate amid an economic contraction. Let us think about that. During a once-in-a-lifetime economic contraction, housing prices actually went up. During a crisis where there is a massive collapse in economic activity, real estate has gone up. The effect of interest rates being artificially suppressed has clearly added to the demand for housing while doing nothing to address supply. What about housing supply? A recent report says that Canada lacks 1.8 million homes; that is the deficit in housing supply. Developers have complained about delays in bringing new land under development. Regulation and red tape from all three levels of government cause delay and uncertainty that restrict development. These issues are not new, and we were approaching crisis levels long before COVID. The government now takes enormous credit for its national housing strategy, which includes its signature program first announced just before the 2019 election: the first-time homebuyer incentive. I want to talk about this program, because as recently as during these past two weeks, the beginning of this Parliament, the Prime Minister has cited this program in question period in response to questions from the opposition about inflation and housing affordability. This program was designed to help first-time homebuyers struggling to access mortgage credit under the government's so-called stress test. The stress test was actually put in the first place to try to cool the housing market by restricting access to mortgages. When the government realized the people who were being punished the most by the stress test were first-time buyers in real estate markets other than Vancouver and Toronto, it announced this program and called it “transformational”, claiming 100,000 Canadian families would achieve the dream of home ownership through the program. Under this program, a would-be homebuyer must be an absolute top-tier borrower in terms of credit eligibility, employment and whatnot. They would had to have saved 5% down from their own resources, and they may apply to have the government supply another 5%, which would have the effect of very slightly reducing the amount that they need to borrow from the bank and therefore slightly reduce their monthly payment. The borrower can repay the government later, either when they sell the home or by paying out and discharging the government's interest in the property based on a future appraised value. This was the government's 2019 solution for access to home ownership. This solution is to offer something to people who would have qualified anyway and would have had access to mortgage credit. By giving them the chance to have the government be an equity partner with them in their own home, when the homeowner eventually sells the property, the government gets half of the profit, but if the property goes down in value, the taxpayer shares in the loss. This was the Liberals' solution to access home ownership before the 2019 election. They are still talking about it now as if this is somehow part of their solution to the current crisis that we are in. This program was launched just before the election, and it is now entering its third year. As of July, only 9,000 Canadians had accessed this program; this “transformational” program, they claimed. Last night, during committee of the whole, I asked the Associate Minister of Finance for an up-to-date figure, because that 9,000 figure was from July. He had several, very capable Finance Department officials around the table, but he chose to ignore that question, and so the July number is the most up to date one we have. However, there is no question that this program has been a complete failure. It has not really addressed anything. It is hardly “transformational”. The problem of affordability and home ownership being out of reach for so many Canadians has gotten much worse since this program was announced. Today, Conservatives are proposing meaningful solutions that will actually address some of the limitations on housing supply while assuring existing homeowners and prospective homeowners that owning a principal residence, we believe and the House affirms, is an important foundation for stable families and communities, and that the government will not tax the primary residences upon sale. The Conservatives are proposing that the federal government review and consolidate federal real estate properties and make 15% available for residential development. We heard today that the federal government owns tens of thousands of buildings. These buildings are in various states of repair or disrepair, with wildly varying degrees of functionality or obsolescence. Many of these buildings may not be worthwhile and may not be in the public interest for the Crown to continue to hold them. Commercial buildings have a life cycle, and the highest and best use for land varies over time. We ask the government to take a serious look at whether it is in the public interest to continue to own many of these properties. With large amounts of land and thousands of buildings, surely there are some that the federal government can use to add to the supply of housing to do something to arrest this out-of-control, continuing inflation in real estate. Another factor limiting the supply of homes is the existence of unoccupied homes in Canada. Conservatives are proposing to prevent foreign investors from parking their money in Canada as a place to sit money in a vacant property. For many years now, it has been widely known that Canada's real estate market has been a prime destination for wealthy foreigners to, at best, take advantage of Canada's relative stability and rule of law as a hedge on their foreign wealth or, at worst, use as a haven for money laundering among the world's kleptocrats. It is time for meaningful action. No foreign national should be permitted to buy a home in Canada just to have it sit vacant while Canadian families give up the dream of ownership. To conclude, I will add that the Liberals have sent out mixed signals on the issue of taxing capital gains. In a recent interview with a former CEO of CMHC, he talked about and affirmed his support for such a tax. We know that Adam Vaughan, who was this government's principal spokesman on housing issues, favoured such a tax. We also know that this government will eventually have to reckon with the debt and deficits that have accumulated, and were accumulating long before the COVID crisis. Its instincts will always be to pass on these costs in new taxes.

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All Topics

Mr. Mark Gerretsen (Parliamentary Secretary to the Leader of the Government in the House of Commons (Senate), Lib.)

Dec/9/21 1:22:31 p.m.
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Madam Speaker, it is fascinating to see how this day is going. We started off with Conservatives talking about 41 million hectares of land in the first few speeches and now, suddenly, since holes have been blown into that argument, somebody back there is scratching out “41 million hectares” in the speeches and writing “thousands of government buildings that exist”. We have heard it already said in this House, and the member put forward what I think is a good idea, that we should declare surplus land available for various purposes, but it already exists. As we heard the parliamentary secretary say earlier, it already exists in the form of a land bank through the federal lands initiative. Can the member comment on why Conservative speeches in the House have suddenly adopted this tone of making thousands of buildings available when this already exists?

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Mr. Pat Kelly

Dec/9/21 1:23:28 p.m.
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Madam Speaker, is the member asserting that the Liberals are successfully managing, as I think I heard in the speech by the member for Edmonton Riverbend, 37,000 buildings, that they have succeeded in ensuring that buildings that have reached the end of their life cycle, that are no longer functional for their intended purposes, meet the best use of land and that they are succeeding in transitioning these lands for private development? Is that his assertion? I would suggest that he vote in favour of this motion and commit to 15%.

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Ms. Monique Pauzé (Repentigny, BQ)

Dec/9/21 1:24:16 p.m.
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Madam Speaker, the motion itself does not mention social housing, but it implies that the ultimate objective is to increase the number of available housing units, which are currently lacking. Could my colleague clarify whether the official opposition's motion includes social housing?

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Mr. Pat Kelly

Dec/9/21 1:24:43 p.m.
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Madam Speaker, when a motion is put forward, it is always tough when we talk about all the things it could have said in addition to the things that it actually says. The member is correct in terms of drawing attention to many of the deficiencies of the government on housing. This motion and my remarks on this motion primarily address the failure of supply and the role that the federal government can play in increasing the supply of real estate available for development and for sale for Canadians to buy.

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Mr. Richard Cannings (South Okanagan—West Kootenay, NDP)

Dec/9/21 1:25:28 p.m.
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Madam Speaker, my colleague said he had a background in real estate. The Conservatives refused to accept the NDP amendment to this motion that specifically asked for non-market housing, for affordable housing. As an example, another Conservative just brought up an example of a building we could use in downtown Toronto, right across from Union Station. I am wondering if the member could opine on what a condo in such a building would cost.

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Mr. Pat Kelly

Dec/9/21 1:26:11 p.m.
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Madam Speaker, a new development in that particular location would add to the overall supply and put a damper on the endless increase in demand. The condo building that the member for Wellington—Halton Hills spoke about would add to the supply throughout the market and would have a positive effect on affordability. This is the problem. Demand is being fuelled in part by the government's deficits, which are being facilitated through quantitative easing. We need to get past that. We need to increase supply and quit pouring gasoline on demand.

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Mr. Matt Jeneroux (Edmonton Riverbend, CPC)

Dec/9/21 1:27:05 p.m.
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Madam Speaker, I often watch House proceedings on TV or come into the chamber and I feel sorry for the member for Kingston and the Islands. Today again he tied himself directly to the Kathleen Wynne government. I would ask the Prime Minister to please throw him a bone and help him. He is sitting on the backbenches and continues to heckle. What I want to address is something that the member for Winnipeg North mentioned about the motion, which was to remove clause (c), the piece on a capital gains tax. I have not heard the member for Vancouver Granville speak yet today. I wonder what he thinks of that.

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Dec/9/21 1:27:44 p.m.
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A very brief answer from the hon. member for Calgary Rocky Ridge.

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Mr. Pat Kelly

Dec/9/21 1:27:48 p.m.
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Madam Speaker, it sounded like there were some questions for a few other members there. Regarding the third part of the motion, there was an interesting response from the member for Winnipeg North. It seems that the—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Dec/9/21 1:28:05 p.m.
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We will have to leave it at that. Resuming debate, the hon. member for Carleton.

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Hon. Pierre Poilievre (Carleton, CPC)

Dec/9/21 1:28:10 p.m.
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Madam Speaker, why? That is the most basic question anyone asks when something strange happens anywhere in nature. Why is it that a family in Riverside South, a suburban community 25 minutes from here, has been bid out on seeking a house eight times, most recently watching one normal middle-class house go $400,000 over the asking price, from $800,000 to $1.2 million? Why? Why have housing prices gone up 32% in a period of just a year and a half, while the economy has actually shrunk? Why are housing prices going up while wages in real, inflation-adjusted terms are going down? Why is this incredible bubble filling with air? Let us go through the reasons that we have been given for the recent housing bubble. Some people blame house prices in Canada wrongly on immigration. We know that cannot be true, because throughout COVID there was almost no immigration, yet house prices went up. The normal flow of roughly 300,000 newcomers seeking houses nearly came to a grinding halt. Immigration cannot explain the ballooning house prices. Some have blamed inflation in general on supply chain problems, but of course land does not have supply chains. It is already right beneath our feet. We do not import land on a ship. It is not stuck at a port. It was put here by billions of years of geological development. We cannot blame foreign supply chains for the booming price of housing. Nor can we blame it on global factors, because housing inflation here has been far worse than in any other nation, with the exception of New Zealand. According to Bloomberg, Canada has the second-most-inflated housing bubble. Similarly, The Economist magazine has named Canada along with New Zealand and Australia as the countries it thinks might experience a massive crash on the scale of the 2008 crisis in the United States of America. If this was a global problem, we would not be suffering a much bigger bubble than the rest of the globe. Some trendy commentators have said it is just that Canadians' preferences have changed. Because of all of the cabin fever that came with lockdowns, people want to live in the countryside and have more space; therefore, they are paying more for real estate. If that were true, we could verify it simply by seeing a drop in housing prices for inner-city condos. If people were all unloading those condos to go and live in the countryside, we would see the prices of urban condos drop. In fact, they too are up 15%. Finally, and more plausibly, some people have pointed to the fact that it is very hard to build anything here in Canada. That is true, and that is one of the long-term structural reasons why we have inordinately high real estate prices in Canada. We all are aware of the incompetent municipal and provincial governments that drive up housing prices with their bureaucracies, and the rich urban snobs who like to prevent people from living in their neighbourhoods by lobbying city councillors to prevent development. That is all true, but it does not explain the rocketing prices that began in the spring of 2020 because, of course, snob-zoning and incompetent bureaucracies are nothing new. They did not appear in Canada. We did not suddenly have an airdrop of one million inner-city snobs on Canada when COVID hit. They have long been here with the bureaucracies backing them up, blocking us from building housing for other communities for a very long time. That is nothing new, so what is new? Why all of a sudden, when the economy fell off a cliff, did the price of housing suddenly rocket? If we look more microscopically at the data, we will see that in March and April of 2020, house prices actually started to drop. We forget that now. It was just as our number one housing agency predicted. CMHC said that house prices would drop 10% to 14%, and then suddenly there was a change of direction. Prices went up and up, until they were far out of reach for everyday, ordinary working-class people. What happened in the spring of 2020 that would cause this inexplicable phenomenon to begin? The answer is that in late March, and running through until about a month ago, the government had the central bank pump $400 billion into the financial markets in order to make it cheaper for the feds to run deficits. The thinking was that if the central bank printed cash to buy bonds, it would drive down interest rates enough for the Government of Canada to be able to run consequence-free deficits, at least in the short term. The problem is that much of that money overflowed into the mortgage market. Just this week, we found out that mortgage borrowing totalled $193 billion in that period of time. That is almost a quarter of a trillion dollars of mortgage lending, and what do we know? When the financial and mortgage markets are flooded with cash, that cash goes out and bids up the price of houses. In fact, the multiplication effect of a dollar inserted into the housing and financial system is really powerful. To simplify, let us say that we have 10 houses in a given country and each is worth $100. The total market value of all those 10 houses is $1,000. If one person manages to get some of that money from the central bank and bids up the price to $200 for one of those 10 houses, that house then has a market value of $200. What happens to the entire street? That entire street's market value now doubles, so $100 of extra purchasing power adds $1,000 of market price. This is the incredible multiplication power that leads to housing bubbles. That $400 billion led to $200 billion of new housing demand, which led to many more multiple increases in market value. What happens with that? People then go out and borrow against their new home equity. They have unrealized gains in their homes that they use to collateralize more debt to buy more assets, which further inflates asset bubbles. We have seen a massive increase in the market price of assets across the economy since this experiment with central bank money printing began. Here is the problem. What goes up can come crashing down. People are basing their economic decisions on assets that are floating on top of a bubble. When that bubble bursts, all of those assets, and the people who rely on them, come crashing down. In the meantime, the poor and the working class can no longer afford to purchase those assets. Thus, we see a massive expansion in the gap between the rich and the poor. Trickle-down economics has never worked. Giving money to large financial institutions and expecting it to reach the working-class people at the bottom is a figment of the government's imagination. The people who do the work will pay the price in the crash, but get none of the benefit during the bubble. The answer is to stop printing money, free up more land and start building housing. We need to incentivize our municipalities to clean away the red tape and create work for our carpenters, framers and other tradespeople. We need to open up more land to supply our young people with homes and restore the great Canadian dream of having a place to live and a roof over one's head in a country that is a meritocracy, not an aristocracy.

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Mr. Mark Gerretsen (Parliamentary Secretary to the Leader of the Government in the House of Commons (Senate), Lib.)

Dec/9/21 1:38:14 p.m.
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Madam Speaker, we have now seen this Conservative member come back to talking about land to build again. That is not the narrative that we have heard. More members are clapping again, which is good. Here is what we know. This motion is asking for 15% of the federal 41 million hectares of land to become available for redevelopment, as this member would like, yet we know 97% of that land is tied up in Parks Canada, National Defence and Environment Canada. Can the member just let us know what, within Parks Canada, the Conservative Party is looking to divest in order to build what he is speaking of?

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Hon. Pierre Poilievre

Dec/9/21 1:39:01 p.m.
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Madam Speaker, I wonder if we might have a messenger service here that I could use to deliver the member the actual motion. I would ask him not to be shy and to come on over. I will read it for him right here. Come back. Do not run away. Come on now, I am going to help you read the motion.

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Dec/9/21 1:39:23 p.m.
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Do the hon. members know and realize that they have to speak through the Chair? This is not a tier. The hon. member speaks through the Chair.

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Remarks addressed to the Chair

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