(Quebec) With housing starts stagnating and a lack of new investments in affordable housing, young people hoping to buy a home in the coming years will not find a “ray of sunshine” in the Girard budget.
WHAT THERE IS TO KNOW
What ?
Quebec is not adding money to build new housing in its budget, even if construction starts stagnate in the coming years.
For what ?
Eric Girard argues that last year he already announced $1.8 billion to build 8,000 new housing units.
Reaction
The APCHQ deplores the government’s inaction in this matter, and Québec solidaire believes that the CAQ is doing nothing to counter the housing crisis.
The Legault government does not provide new amounts to build affordable housing in its most recent budget and is not putting in place any measures to stimulate the construction of private housing. This decision is disappointing in the housing community.
“There is no ray of sunshine for young people looking for a home. And since people who normally buy property stay in apartments, this makes housing increasingly rare. The cycle is broken. Without the help of parents, it becomes very difficult for young people to buy housing,” says the economic director of the Association of Construction and Housing Professionals of Quebec (APCHQ), Paul Cardinal.
His organization, like others, asked Quebec to follow Ottawa and suspend the QST for the construction of new housing. According to a study commissioned by the APCHQ, this would subtract up to $163 from the rent of a two-bedroom apartment and could shift rental projects in development from “unprofitable” to “profitable”.
The objective: to stimulate construction starts, which are plateauing.
After a peak in 2021, housing starts are stagnating.
According to the APCHQ, nearly 150,000 housing units would need to be built per year to address the housing crisis.
Minister Eric Girard, however, rejected this request. He does not believe that this measure is useful and believes that the future drop in interest rates will have a greater impact on the resumption of construction in the residential sector. But this data is already taken into account by forecasters from the Ministry of Finance.
Mr. Girard says his government has instead chosen “direct aid”, subsidies to build housing. And if he is not adding money to this budget, it is because he has already invested a lot in the past, notably 1.8 billion last year to build 8,000 new housing units.
But this is very little compared to the most recent estimates from the CMHC, which underlines that Quebec is heading towards a deficit of 860,000 housing units by 2030, deplored the APCHQ and other groups, such as the Association of construction in Quebec, in a memorandum submitted to the Ministry of Finance.
And the housing crisis is hitting hard. According to CMHC’s 2024 rental market report, published at the start of the year, vacancy rates have never been this low since 2003. And all cities are affected, small, medium and large.
These vacancy rates are pushing up rents. In Quebec, the rent for a two-bedroom apartment increased by 4.8%, compared to 7.9% in Montreal and 9.8% in Sherbrooke. And this increase hides another, because in the case of rents where apartments have changed occupants, it was 18.9% in Montreal and 13.0% in Quebec.
In this context, expectations were therefore very high for the Girard budget. Québec solidaire hoped that housing would be at the heart of the financial year. However, “there is nothing here to resolve the housing crisis,” lamented MP Haroun Bouazzi. “There have never been so many people on the streets, families are paying more and more for their rent, and houses have never been so expensive. We need a boost in housing, and we would have hoped for a reduction in taxes as proposed to give a boost to new construction,” he lamented.
Other groups, such as Vivre en Ville and Réseau québécois des OSBL d’habitation, also denounce the lack of action. “Failing to present significant new budgetary measures concerning housing, Minister Eric Girard simply recalled the investments made in the last year,” lamented the RQOH.