It’s been an interesting couple of weeks - details of Ontario’s Housing Supply Action Plan were released, debate over the mortgage stress test continued, and sales activity started to heat up.
I can’t decide how I feel about the Housing Supply Action Plan yet. I support the idea of it and what it’s trying to accomplish - more choice for homebuyers is a positive thing - but even with the release of the bill, I don’t fully understand what’s going to be done to remove “red tape” that slows down the development approvals process.
Leaders in the new home industry, like members of the Building Industry and Land Development Association and the Ontario Home Builders’ Association immediately showed their support for the Action Plan, and I tend to trust my peers. I’m assuming they made suggestions via submissions while the province was consulting the public.
Ontario says it will help municipalities create a community planning permit system, which is supposed to streamline the approval process to just 45 days! It’s not clear whether the assistance from the province would be in the form of funding, manpower, or consulting. Perhaps all of the above.
All I know is that municipalities across the province differ so much that each town and city will need a detailed permit system tailored just for them. Innisfil’s permit system won’t work in Toronto and vice-versa. It could be a long time before municipalities have a fully fleshed out community planning permit system that works as smoothly as the province is planning.
One thing that kind of rubbed me the wrong way was the removal of the requirement to include electric vehicle infrastructure in new developments. I can’t say I’m currently driving an electric vehicle, but I like the idea of more people having the option to do so (I’m in line for my Tesla). I especially think it’s important for new condo developments to have the ability to accommodate electric vehicles. If you’re going to live in a dense urban neighbourhood and still drive, it might as well be an electric car.
I understand the removal of the EV infrastructure requirement - it will definitely save costs, which are hopefully passed down to the buyer. But, I can’t help but feel like some sustainability features need to be mandated. There’s no point of owning a home if you can’t breathe the air.
From what I could tell there are no timelines in place for the implementation of the province’s Action Plan, but I’m looking forward to seeing if all the measures taken lead to a significant increase in housing supply.
At the end of last year, I touched on the need to remove or revamp the mortgage stress test. There’s been no sign of this happening, but TD Bank did recently explain that removing the stress test would in fact lead to long-term affordability issues.
So, it doesn’t look like trashing the stress test is a smart move, but TD does go on to say that the federal government should be open to altering the stress test as market conditions change.
Hopefully the feds show some flexibility with the stress test as Ontario’s Housing Supply Action Plan begins to take effect.