It seems nothing has united Canadians more in recent years than the feeling that the housing market in Canada is entirely out of control. Across political and demographic lines, exploding prices on homes have been hitting Canadians harder and harder with each passing year and, unfortunately, many are losing hope.
Still, two things remain to be seen: effective government actions to curb an out-of-control market and a supposed market bubble that would pop and somehow make everyone a homeowner in the process. While one is merely hypothetical, the other is something that can actually be done by our elected officials - or so they claimed with their myriad campaign promises in our recent elections.
So, when is the change actually going to come?
One recent step has been taken by the House of Commons Finance Committee who agreed on Wednesday to hold hearings on the causes of inflation in the housing market, and others. The investigation comes ahead of the next sitting of parliament at the end of January, for whom the issues are a top-billed concern.
During a meeting on Wednesday, Conservative MP Pierre Poilievre moved to undertake a study of Canadian inflation in housing, food prices, and supply chains for strategic goods. According to Poilievre: “Our economy has become a gigantic inflated balloon. The asset class in which we see this balloon most inflated is of course housing.”
The motion was passed successfully and hearings will begin next week to continue until the 24th of the month with no fewer than ten sessions to take place. Meetings in this study are expected to feature testimony from Finance Minister Chrystia Freeland, Bank of Canada Governor Tiff Macklem, and Peter Routledge, among others.
Though the meetings can do little to change things immediately, it does serve to illuminate some of the major issues that are facing our economy today and could be a start towards helping us find a way forward. It should also help to put some pressure on the Liberal Party government and finance authorities to make good on their campaign promises with regards to housing and affordability. Despite a wide-reaching plan laid out during September’s election campaign, there have been few measures actually undertaken as of yet.
This move comes as we enter 2022 with record-high home prices across the country and many areas displaying high double-digit house price increases for the second year in a row. At the same time, the consumer price index has reached its highest inflation rate in almost 20 years.
For the last while, the ailing economy has been allowed to continue its course, justified as a necessity to protect Canadians from the recession that ushered in from the COVID-19 pandemic. Now, however, as we (optimistically) approach the end of the pandemic, all eyes are on the government and the Bank of Canada to turn things around.
Stay tuned to CREW for more coverage on the Finance Committee’s meetings in the coming weeks.