The election of Prime Minister Mark Carney and the Liberal party presents a critical opportunity to reset the national approach to housing and economic policy — one that prioritizes outcomes over optics.
The government must focus on affordability, increasing the housing supply, and laying the groundwork for long-term growth.
The GTA housing crisis will be a defining issue in the looming elections, writes Dave Wilkes.
Few places illustrate the urgency of Canada’s housing crisis more clearly than the Greater pc28¹ÙÍøArea (GTA) and its surrounding regions, which account for 20 per cent of Canada’s population and a quarter of the country’s economic output — yet continues to face a worsening housing shortage.
The GTA has historically represented around a fifth of the country’s housing starts, but activity in the GTA has slowed to a crawl.
The Canada Mortgage and Housing Corporation (CMHC) reported that housing starts in the pc28¹ÙÍøCensus Metropolitan Area were down 58 per cent year-over-year as of March 2025.
Canadian businesses and consumers are bracing themselves for ‘uncertain times’ of the White
According to Altus Group, March 2025 saw only 385 new homes sold, which is 87 per cent below the 10-year average for that month.
And while homebuilding is chugging along just fine across Canada, it has come to a screeching halt in the epicentre of the housing crisis: The GTA.
Addressing this requires policy that reflects the economic pressures facing buyers and builders alike, and structured to the unique challenges found in each region of the country.
The first example is the proposed policy surrounding the federal GST/HST.
While recognition that the taxes erode housing affordability is a good step forward, the proposed GST/HST exemption is too low and inequitable to new home buyers in the GTA.
To restore equity and affordability, the federal government must expand on its GST/HST exemption campaign promises.
The current proposed exemption of $1 million ignores the reality that $1 million in the GTA barely covers a modest condo, while the same amount buys two detached homes in Edmonton, despite very little difference in median family incomes between the two centres.
A fairer approach would be to exempt the first $1 million of all new home purchases and the exemption should apply to all new home sales.
Applying it only to first-time buyers, as currently proposed, will have a muted impact as fewer than 20 per cent of new home buyers in the GTA fall into this category.
Making these changes would bring the program more in line with the original policy intent when the GST and its rebate program was introduced on new homes, namely tax relief that would apply to basically all average home purchasers across the country without distinguishing between types of buyers (first time or otherwise).
Working with municipalities and provinces to reduce development charges (DCs) on multi-family units for a five-year period is another positive commitment.
The federal government can and should play a critical role by supporting municipalities with infrastructure investments and by linking funding to offset DCs to tangible housing outcomes.
This commitment must include all housing and not be time-bound, but rather made permanent to help reset housing costs and address the cost-to-build crisis.
The reintroduction of incentives for multi-unit residential buildings (MURBs) is an excellent step.
In contrast to the Building Canada Homes (BCH) initiative, MURBs are a proven federal policy with a strong track record of results.
They are a classic example of the government creating the right conditions to support development and then letting industry get on with building.
Originally successful in the 1970s, the program helped deliver more than 200,000 rental units across Canada by creating tax incentives to invest in rental housing.
When paired with the GST/HST rebate on purpose-built rentals announced in 2023, the reintroduction of MURBs could reignite rental construction at both large and small scales to meet a growing demand.
Lastly, the federal government should reposition the proposed BCH initiative.
While the idea of a public builder may sound appealing in theory, the reality is that large-scale government projects and procurement efforts have historically been hampered by bureaucracy, inefficiency, failure to meet timelines and hugely inflated costs.
Canada’s housing shortage and affordability crisis is not a result of too few builders, and adding another builder will not move the needle.
Rather, Ottawa should partner with the housing industry, identifying and removing policy barriers that have a negative impact on productivity. This partnership should also extend to surplus public lands where housing can be quickly built.
Federal housing policy must be crafted to be applicable to all regions of Canada and that means tailoring policies to include the costliest regions, not simply the average.
A credible housing strategy cannot ignore the regions that power Canada’s economy, and the GTA stands foremost among them.
During the campaign, Carney stated that now was the time to invest in housing.
As the voice of builders and developers in the GTA, we couldn’t agree more, and look forward to working with the new government to reduce the cost to build and to build more housing for Canadians.
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