The Ben Mulroney Show - How will the Government Restore the Dream of Homeownership?

Episode Date: May 12, 2025

Guests and Topics: -How will the Government Restore the Dream of Homeownership? with Guest: Mike Moffatt, Economist, Founding Director, PLACE Centre. Co-Host, "Missing Middle" If you enjoyed the podcast, tell a friend! For more of the Ben Mulroney Show, subscribe to the podcast! https://globalnews.ca/national/program/the-ben-mulroney-show Follow Ben on Twitter/X at https://x.com/BenMulroney Enjoy Learn more about your ad choices. Visit megaphone.fm/adchoices

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This is the Ben Mulroney Show. On the Chorus Talk Network. Welcome back to the Ben Mulroney Show. And when I say welcome, I don't know where I'm finding you. You might be listening to us on the radio or you might be streaming us on say the iHeart radio app, or you may like to listen to us at any time a day that suits you by listening to us on a podcast platform like Spotify, Apple Music or Amazon Music, but wherever you are and however you take in this show, we cannot build it without you. So thank you very much for being part of the Ben Mulrooney show. Now, if you've listened to this show for any amount of time, you know that we try to tackle as many important issues as there are out there. And by and large, to do this show means you gotta have opinions. And I've got lots of opinions on lots of issues

that are facing cities and provinces and the country writ large. But there's one file I just don't have any answers for. And that is the housing crisis. It is a crisis that needs to be attacked from every level of government, from so many different angles. It brings in issues of taxation and income and social mobility and inclusion and investment. And if you don't have a holistic approach, you're going to fail. At least that's the opinion that I hold

as somebody who's not an expert in these things, but I'm invested as a Canadian. And so let's bring in somebody who does have a more wherewithal and know-how as it relates to this. Mike Moffitt, he's an economist, as well as the founding director of Place Center, and he's a co-host of the Missing Middle podcast. Mike, welcome to the show.

No, thank you for having me. So when I read your article, it says, the next housing minister must restore the dream of home ownership. It's like, ah, finally, somebody who's gonna bring some class to this conversation, somebody who's gonna bring some ambition and know-how and knowledge to the conversation.

Because it's, look, it's a lofty goal, restoring the dream of home ownership. But how we get there is what matters. Yeah, absolutely. And I do think that the federal government or the incoming federal government isn't paying enough attention to the fact that young people feel like they'll never be able to own a home.

You look at the Liberal platform and there's a lot of great stuff in there to increase the housing supply, but it's very rental focus. They're looking at bringing back a tax credit from the 1970s for rental housing, this new Build Canada Homes to help build government housing, and those are all fine ideas. There's really not a lot in here to restore the dream of home ownership. And I think that is a mistake given the frustration that young people currently have.

Well, yeah, and you really attacked this from a lot of perspectives in your article, especially. And hopefully we can start with this one. I want to, in cities like Toronto, the condo market has never been as bad as it is. Nobody's buying condos. And as a matter of fact, there's a lot of condo construction where I guess the people building

have to ask themselves, is it even worth it for us to finish building these buildings? And so you say, governments need to ask, where should pre-construction condo funding come from? What do you mean by that? Why is that a question that needs answering? Well, so normally with a condo, you need to get, the condo builder needs to get pre-sales.

They need to make sure that there's a market out there for these units. And the average owner-occupier doesn't wanna wait four, five, six years, put a deposit upfront, know, six years from now or whatever, get a home. So who usually buys these things are investors. And we've seen from the liberal government, you know, a lot of policies to try and deter investment. And this seems to be one of those be careful what you wish for things, because now that

the investors have all pulled back, they said, no, we don't want any part of this. And none of these projects are going ahead. So I think the government has to ask itself, okay, if you don't want investors in that market, and that's a legitimate point of view, where are you expecting the condo developers to get those pre-construction sales from because it doesn't seem like there's anybody else out there. And so what's the answer? Well, I think there could be a few things. One potential answer is CMHC financing. The same way that the CMHC helps build

purpose-built rental apartments, they could provide financing to condo builders. So that's just one solution. But I think the federal government has to go a step back and just kind of admit that there's a problem where, you know, again, they try to deter investor activity. Yeah. You know, they try to get rid of plan A without identifying first what plan B is.

And so that, listen, that's one thing that needs to be attacked. In my introduction, I talked about how, you know, if the goal is to restore the dream of home ownership, it's not going that needs to be tackled. In my introduction, I talked about how, if the goal is to restore the dream of home ownership, it's not gonna be solved simply by tackling pre-construction issues with condos. There's so many more issues.

So in your mind, what are the most stark and most important issues that need to be tackled by the new government that will yield real results and get that younger generation feeling that homeownership is in fact attainable. Yeah, well, we have a real cost of delivery crisis here that we just can't build homes cheaply enough. One of the big reasons is tax. Tax makes up 30 to 35% of the cost of construction. The federal government has a

really obvious lever there in the GST. When the GST was introduced, something over 95 percent of homes were eligible for a GST rebate. Nowadays, you know, and that was never increased for inflation, so nowadays in the GTA, no home gets it. The conservatives had said that they were going to make this available to homes up to 1.3 million. The liberals came out with a very modest plan to only make it available for first-time home buyers, which really won't get that many more homes built. So I think the first thing they need to do is look at taxes, particularly the GST, and lower them, if not outright scrap them on new home constructions to get more homes built. And then I think we need to look at the availability of land. We've become very restrictive on where we build, so it's hard to get those homes. But if governments can attack

the cost of land and taxes, a lot of this takes care of itself. Yeah. Well, there was also the issue. I mean, it's the taxes and the fees, right? And that's when this housing minister is going to have to take a leadership position in communicating with the other two levels of government. For the longest time under the Trudeau Liberals, there was this denial that the federal government

could even do anything on the housing file. And it was a game of political hot potato where every level of government was saying, no, no, it's the other guy's fault or the other guy's responsibility. What's, I mean, I have to assume that if, for this to be resolved in the next four years, because I think that, well, that's the mandate,

that this housing minister is going to have to be a leader even on parts of of this file that aren't necessarily his or her domain. You're absolutely right and when Prime Minister Trudeau made those comments a couple years ago that housing was not a you know primary concern of the federal government there was a lot of backlash to it and then you know after that we started to concern of the federal government. There was a lot of backlash to it. And then, you know, after that, we started to see the, the federal government get more aggressive on the issue with things like the housing accelerator that provides incentives to municipalities to do things

like speed up approval processes and lower development charges. I think they need to go a lot further on that. And I think even they would agree, you know, they have a piece in their platform around lowering, helping municipalities lower development charges. That's an absolutely great thing, but even there, their development charge plan isn't across the board,

is more focused on apartments. And we need to do that, but we also need to lower development charges, on townhomes and other types of ownership based housing. And again, it's where I'm kind of a little bit critical of the federal government that they want to do a lot on renting, which is fantastic. But we've got to address the ownership side as well. Yeah, no, absolutely.

I remember when I got into the housing market, the first thing that we bought as a couple was was a condo. And then from that, we moved on and bought a home. In the 30 seconds, if you can give me your take on this Build Canada initiative, because there was a lot of criticism that the government should do what the government's good at and stay out of the way of home. Let the home builders build the homes. Yeah, I do think there is some merit there. We do need more social housing. So if we can of the way of home. Let the home builders build the homes. Yeah, I do think there is some merit there. We do need more social housing.

So if we can figure out how to build it and use innovative technologies, I think that is a good thing. But you're absolutely right. This is a very complex thing to do. And governments aren't always the best at doing those complex things. Well, I'm really glad that you wrote this. If anybody wants to take a look at the article,

it's at missingmiddleinitiative.ca. The next housing minister must restore the dream of home ownership. Mike Moffitt, really great to talk to you. I hope it's not the first time. Yeah, absolutely. Look forward to our next chat. Welcome back to the Ben Mulroney Show.

And thank you so much for starting your Monday with us. It's going to be a great week ahead. It's great to start this show with everyone who listens and everyone who participates and joins us online and joins us in conversations beyond the show on Twitter, for example, it means so, so very much. So the international and global adventure that we're all on called the international and global adventure that we're all on called the Donald Trump trade war and tariff war is is yielding results are they are they good are they bad nobody really knows right so when we read this morning that the US and China

have taken a step back from their sky-high tariffs and agree to pause their tariffs for 90 days in order to have more talks. That looks like a good thing. So they all met in Geneva, the US and China. They got together in Geneva and they reached they reached a deal to have a deal. Right. And they've backed off on most of the tariffs.

And what what did that do? It was an instant shot in the arm for the stock market, major bumps in the stock market, because these are the two biggest economies in the world. And the reaction, obviously, from the United States anytime, look, when they impose tariffs, they tout that as a success. When they remove tariffs, they tout that as a success. When the tariffs hit the stock market poorly, they say, oh, that's just a, that's a little bit of a problem. And then when the stock market goes up, they tout that as success. So very, a lot of spin coming out of Washington, but it does, there are some net benefits, I think, that we can probably all agree on. And the fact that this takes away one of the choke points on global supply chain issues

is a very big deal. One of the quotes that I think is worthy of highlighting the consensus from both delegations this weekend is neither side wants a decoupling. And that comes from the Treasury Secretary Scott Bessent. He said, we want more balanced trade. And I think that both sides are committed to achieving that. Now, how long until they achieve that? Who knows? I mean, we're already being told that the US-UK deal that was reached last week is fantastic, one of the best trade deals of all time. But experts in the know

suggest that there is no deal, it's a deal to have a deal. And this seems like the same thing. So the devil's in the details, and we'll know at some point in the near future whether this becomes a deal, or whether it's just a lot of vapor, as was described the US-UK deal last week on this show. a lot of vapor as was described the US UK deal last week on this show. Here's something I don't even know what to do with this. Donald Trump has announced something very big is coming.

I don't know whether it's between Canada and the United States or it's something that the Americans are gonna to do that is affecting Canada. Let's listen to this. I don't know what this is. This is a this is a this is a teaser. That's for sure.

This is a Donald Trump teaser. Let's listen. You know, I said before in our meeting with the new and very talented prime minister of Canada that we have some very big announcement to make. It's not about trade. It's about something else, but it's gonna be a truly earth shattering and positive development for this country and for the people of this country.

And that'll take place sometime within the next few days. Okay, so we've gotta break that down a little bit, right? He said, he referenced Canada, and he says it's gonna be earth shattering for the people of America, for the Americans. He didn't say it was going to be beneficial to both countries. And he says it has nothing to do with trade. So it's either the border or it's the Arctic. Those are the two that stick out to me. I don't know what else it could be.

that stick out to me. I don't know what else it could be. But if it's the border, we've already heard of the changes that Justin Trudeau's government was bringing to beefing up the border security and taking it more seriously and stopping the flow of fentanyl and adding drones and I think people on horseback and more manpower

to protecting the border and to surveying all the shipping containers coming in at ports on either side of the country. So I don't know what else could be announced at the border that would be, quote, earth-shattering and of benefit to the American people. So then my mind goes to the North. You know, has Mark Carney been in discussion with the Americans to have some sort of bilateral military operation in Canada's Arctic to protect and defend the Arctic against Soviet aggression and the Russians. For the life of me, I have no idea how the Chinese think they're entitled to the Arctic.

They don't have a footprint in the Arctic, but that doesn't matter. So that's the one I'm leaning towards, that in an effort to short circuit our way to a robust Arctic defense policy. We're going to bring the Americans in and have some sort of cooperative agreement where the two of us work together to defend Arctic sovereignty, you know, from the easternmost tip of Canada's Arctic footprint all the way to Alaska.

To me, that seems like the one that makes the most sense. And given the fact that the Americans would probably be shouldering the majority of that military burden, that there might be something in it for the Americans, like some sort of deal on critical minerals, on uranium, I don't know. I genuinely don't know. It's not every day that you hear something like that, teasing something earth shattering to the benefit of the American people and includes Canada. Very, very curious to get to the bottom of that one. So tomorrow we're going to get a new cabinet.

The Mark Carney's new government will be announced. We will know the faces and the names of those who will be assigned the responsibility of guiding Canada over the next four years and their ministries. And in anticipation of that, we're trying to get more of a sense of what kind of government this is going to be. So the anticipation of that, we're trying to get more of a sense of what kind of government this is going to be. Is it going to be a government that is influenced by the Mark Carney who wrote the book of values that touted net zero and keeping pretty much keeping all of our oil and gas in the ground? Or is it going to be a government guided by the Mark Carney of the campaign who wants Canada

to be a quote energy superpower? There's a lot that we don't know. And Vashi Kapulos on CTV this weekend to try to get to the bottom of it in her interview with Dominique LeBlanc, who's a storied and a long time face of the Trudeau cabinet now of the Carney edition. Let's listen. Do you concede though that the sentiment in Alberta and Saskatchewan is that that was not the case over the last 10 years? And that there is a high level of concern that that could continue under a Mark Carney government

because you have not, for example, backed off of an emissions cap for the oil and gas sector or C-69, which the Supreme Court even called your government out on. Why are you sticking to those policies which that part of the country has felt greatly inhibited their economic success? So again, the Prime Minister, I think, has, Prime Minister Carney has taken a constructive and positive tone with respect to Western Canadian resources and their importance to the Canadian economy. He is in ongoing conversations with other First Ministers, including obviously the First Minister, the Premier of Alberta, the Premier of Saskatchewan and others.

Those conversations will happen over the next number of weeks. If he's convened them, as I said, in person in Saskatoon with Premier Moe, it's precisely to have those conversations and understand how the Government of Canada can be a partner. And Mr. LeBlanc continued touting the review approval process for these initiatives. The fact that he's saying that we should collaborate in terms of the review approval process for large projects with provinces, one project, one review, not duplicating work that's done by provinces. This is a significant departure

from the previous government and the Prime Minister has I think shown a great deal of understanding and openness to support the economy of these resource intensive provinces. And look, Vashi Kapilow is proving that she's one of the best in the business pushed back saying, look, tone is not action. And the actions that you are committed to not taking are the ones that are the sticking points for Western provinces like B69, like the emissions cap, like the tanker van. Like it's one thing to speak very nicely. It's another thing to not do anything to

deal with the issues that the West is telling you are issues. And so we're going to have to wait and see. To celebrate the Days of Our Lives 60th anniversary, W Network and Stack TV invite you to enter for a chance to win the ultimate fan experience. By watching new episodes of Days of Our Lives, You and a guest could win a three night stay in Los Angeles, a VIP Days of Our Lives set tour, a helicopter ride over LA, and so much more. Watch Weekdays at One and look for the weekly code word to enter.

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