Man with shrugged shoulders.

Three Things to Consider For The 2019 Canadian Election

Updated: Tuesday, October 22, 2019. Read our reaction on election results at the end.

Previously, we talked about the 2019 Federal Budget and we were honestly shaking our heads (and still are). With the federal election less than a week away, the Canadian national housing strategy has been a hot topic on our minds.

Everyone is asking questions about who will win and what will this mean for Canadian housing.

Recent Polls

So, what is going on so far? It seems like we may be in for a minority government based on recent polls.

As seen by CBC’s poll tracker, the Liberals and Conservatives are hovering around 32 percent each. The Conservatives are currently showing a slight lead, but it has been a close call between them and the Liberals for most of the election. Either party does not currently have enough support to form a majority in the remaining week.

The NDP has made some gains in the polls because of Jagemeet Singh’s performance in the last English debate. Increased support for the NDP could lead to a coalition government.

Regardless of the polls, let’s bring some perspective to this federal election. We thought of three things to consider when thinking about the future government and the market. 

#1. The Three Primary Parties’ Platforms

We’ve highlighted some key points from each party on their national housing strategy for Canada:

Liberals

  1. 100,000 affordable homes built over 10 years
  2. Subsidies for first-time homebuyers
    • 10 percent on new home purchases
    • 5 percent on resales but with restrictions
  3. Approximately 1.5 million landlords and homeowners can apply for interest-free loans of up to $40,000 to retrofit their properties for energy efficiency 

Conservatives

  1. Ease regulations for building new homes
  2. Revisit the stress test to allow greater access to mortgages for all home-buyers
  3. Canada Mortgage and Housing Corporation (CMHC)-backed mortgages amortization limits would be raised to 30 years

NDP

  1. 500,000 affordable housing units built over 10 years
  2. Get rid of the federal GST/HST for the construction of new affordable units
  3. Bring back 30-year term mortgages that are insured by the CMHC for first-time buyers

 

#2. What We Think

In our experience, the Conservative housing strategy has worked best for Canadians.

Mortgage broker and Quantus co-owner, Todd Fralic says, The main thing, so far, I see is that the Conservatives actually listened to Mortgage Professionals Canada (MPC) when they visited Ottawa and Scheer is including in his platform some of our key suggestions, like a 30-year amortization and looking at adjusting the benchmark used to qualify.” Overall, these things make it better for homebuyers in the market. 

(If you’re unfamiliar with the stress test rules and the benchmark rate, check out our previous blog.)

#3. What We Know

The Liberal platform with the First-Time Home Buyer Incentive program (FTHBI) is something to be aware of for prospective homebuyers, but it’s been used little by our brokerage. After explaining the program, it’s often determined as not the best scenario for a lot of our clients.

For those of us in the industry, we need incentive plans that are actually beneficial for home buyers and are used by brokers. The Liberals have yet to outline plans for addressing these concerns.

Still…Time to Wait and See

The votes are in and a Liberal minority government will be leading Canadians for the next couple years. How do we feel? Let’s maybe meet up for a drink sometime after we’ve had 24 hours to digest.

For our clients, we don’t see much changing. The stress test will remain status quo and the FTHBI will continue its rollout.

We are concerned that if something doesn’t change, particularly for Alberta, the housing market will feel the effects. We do believe that a Conservative-lead government would have injected cash into the economy, but we will have to wait and see — we could have another election in 18 months that could change the entire political landscape.

On the positive side, nothing is changing tomorrow or the next day. Regardless of the election outcome, we’re here to help you with your homeownership goals.

9 Comments
  • Camille Cruz
    Reply

    Awesome!

    November 4, 2019 at 12:02 pm
  • Brady Mclachlan
    Reply

    Listening to professionals in the industry they are trying to regulate?! What a novel concept.

    November 4, 2019 at 12:28 pm
  • Jerico Alfanta
    Reply

    Choose the one that is closest to our values and beliefs.

    November 4, 2019 at 2:41 pm
    • Hi Jerico, you’re absolutely right. Thanks for the comment!

      November 8, 2019 at 8:00 am
  • Joel Marquez
    Reply

    Well done…

    November 4, 2019 at 4:45 pm
  • Megan Dalrymple
    Reply

    This was interesting to read. To the average person (ie. me) when you listed what each Party was proposing it looked like the Liberals and NDP had more to offer, so it’s interesting to hear that, within the mortgage industry, the Conservative approach shows more useful results for buyers.

    November 28, 2019 at 6:23 am
  • Jessica
    Reply

    I definitely agree with having funds available to retrofit your home. But it should always begin at the building envelope stage.

    November 30, 2019 at 10:08 am

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