Prime Minister Justin Trudeau has announced new measures he says will help protect Canadian renters and help them break into the housing market ahead of the 2024 budget.
He said Wednesday that the proposed three new reforms will “make the playing field fairer for renters” amid an affordability crisis making homeownership out of reach for many.
“It’s too hard to find an affordable place to rent, especially for younger Canadians. That’s why in Budget 2024, we’re taking action to protect renters, make the rental market fairer, and open new pathways for renters to become homeowners,” Trudeau said in a press release.
The proposed measures aim to amend the Canadian Mortgage Charter to allow tenants to count on-time rent payments toward their credit score, and propose $15 million in new funding to provincial legal aid organizations to better protect tenants against unfair rent payments, renovictions or “bad landlords,” the release says.
The government is also proposing a new Canadian Renters’ Bill of Rights which would require landlords to disclose the history of a property’s pricing so renters can bargain fairly.
Trudeau says the bill will “crack down on renovictions, create a nationwide standard lease agreement, and give renters more agency.”
“Renters deserve credit for the money they put toward rent over the years, especially when it comes time to apply for a mortgage for their first home,” the release said.
On rent payments going toward credit scores, Trudeau told reporters at a press conference in Vancouver Wednesday that the measure could open up possibilities when applying for a mortgage and even to secure a loan for a small business.
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“The fact that you pay your rent every month — which remember, is a pretty significant amount of money — that payment and that demonstrated reliability that you’ve shown over months and years is taken into account,” Trudeau said.
This year’s federal budget will be tabled in the House of Commons on April 16 and is expected to focus heavily on housing.
Earlier this month, the NDP called for a rental protection fund to stop renovictions as part of what the party coined its “budget demands.”
In an emailed statement, NDP housing critic Jenny Kwan says the Liberals are “out of touch” on the affordability challenges facing renters and that these “half-measures” don’t go far enough to protect tenants.
“New Democrats are calling for a Protecting Renters Fund to be implemented in the upcoming federal budget that would help not-for-profit organizations buy affordable housing when it’s up for sale, allowing them to keep it affordable for renters,” Kwan said.
“In addition, the Liberals must place a moratorium on the purchase of affordable homes by financialized landlords including real estate investment trusts (REITs) and corporate firms who are making massive profits while driving up costs. It is time that the Liberals end the preferential tax treatment of REITs in Canada and invest that money into affordable housing.”
Renoviction is the practice where tenants are served eviction notices and property owners renovate the building, often reposting the units at a higher price.
The NDP modeled their budget demand off a similar B.C. program, with a $500 million budget.
Wednesday’s press release notes that the new measures are both about protecting renters and about “generational fairness” for millennials and Generation Z, who make up a large part of Canada’s rental market.
Trudeau stressed the importance of young people for Canada’s economy in the press conference.
“You are the heartbeat of the economy and Canada’s success in the 21st century depends on you,” he said.
“In a world where you pay more than ever for rent, what could be a better demonstration that you’re a good investment? And what is a better investment than in you, young Canadians?”
Federal Finance Minister Chrystia Freeland, who was also at the press conference, reiterated the need for fairness in the rental market.
“Our message today is about a fair chance to build a good middle-class life. To do as well as your parents or better has always been the promise of Canada. For too many younger Canadians, that promise just isn’t being fulfilled,” she said.
A Statistics Canada report Wednesday highlighted a number of affordability issues staring down renters and younger generations that put them at risk of missing key financial milestones, particularly achieving the dream of homeownership.
“Sustained food inflation, elevated housing prices, and increasingly unaffordable rental costs across much of the country are casting a shadow over the homeownership dream for many households — and, in particular, for young families,” the report says.
Trudeau’s announcement Wednesday echoed the report’s findings, saying at the press conference that the number of Canadians renting is double the rate of those able to buy a new home compared to a decade ago.
“Renters matter and young Canadians put a lot of their hard-earned money towards rent. We think that should count for a lot more,” Trudeau told reporters.
Trudeau and Freeland also touched on other initiatives the federal government has been taking to increase housing affordability in Canada, such as the Housing Accelerator Fund. The fund encourages municipalities to incentivize building by, for example, removing zoning barriers.
Trudeau’s announcement Wednesday was the first time an item in the upcoming federal budget has been revealed so far. The budget will be all about “fairness,” he said.
“For Canada to succeed, we need everyone to succeed,” Trudeau said at the press conference.
–with files from Motorcycle accident toronto today’ David Baxter
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