Construction industry to lead post-COVID-19 economic recovery
The new home construction industry is well-positioned to play a significant role in the post-COVID-19 recovery in the GTA, Ontario and Canada, according to the Building Industry and Land Development Association (BILD).
“Working with our colleagues at the Ontario and Canadian Home Builders’ Associations, we have put together a roadmap for simple changes that will have a great impact to the economy,” says David Wilkes, president and CEO of BILD.
The CHBA, OHBA and BILD submitted a 20-point plan to the Ontario Jobs and Recovery Committee to help kick-start the Canadian economy post pandemic.
COVID-19 has had a devastating impact on Canada, Ontario, and the GTA, the groups say. Millions of people lost their jobs and the economy has all but ground to a halt. As governments at all levels start to look at recovery, they will need to focus on the GTA, as the region is the engine of Canada’s economy, accounting for 20 per cent of Canada’s and 50 per cent of Ontario’s GDP.
The residential and commercial building and development industry, and the professional renovations industry, are major contributors to economic activity in the region. Collectively, they employ more than 360,000 people in the GTA, paying $22 billion in wages and generating $42 billion in investment value annually.
“With all levels of government facing financial challenges and funding requests, we are providing ideas that will unlock consumer and industry construction investments that will kick-start the economy,” says Joe Vaccaro, CEO of the OHBA.
Proposed measures include transferring mortgage tenancy to the date of occupancy for new condominiums, eliminating security deposits for Ontario Land Transfer Tax on affiliated transfers and freezing municipal increases to Property Tax Reassessment and development charges.
Another proposed recommendation is to free up monies that would otherwise be stuck in such things as municipal agreements (refundable deposits paid by developers) and replace them with surety bonds, freeing up billions in potential investments that otherwise would have been parked.
“To help stimulate economic growth and keep Canadians properly housed, we will need to foster housing supply while also ensuring demand-side measures are adjusted to reflect the times,” says Kevin Lee, CEO, CHBA. “Accordingly, we recommend 30-year amortizations for insured mortgages, and adjusting the mortgage stress test for both insured and uninsured mortgages. Removing the GST on new homes purchased for 2020 and 2021 would also be a timely catalyst for new home construction.”