In another effort to tackle the housing shortage and boost construction, the province will remove its portion of the Harmonized Sales Tax from all qualifying new apartment buildings, student housing and senior residences.
The enhanced rebate would apply to qualifying projects built specifically for long-term rental accommodation that begin construction between September 14, 2023 and December 31, 2030, and complete construction by December 31, 2035.
Wednesday's announcement was lauded by Cambridge's deputy city manager for planning and development Hardy Bromberg who called it proof the province is beginning to understand that solutions to the housing crisis can't be found solely at the municipal level.
He said that's where the focus has been over the last year with the implementation of Bill 23 and legislation aimed at streamlining municipal planning processes and removing development charges.
Removing the full 8 per cent HST on new rental builds means the province is listening to municipal elected officials who understand the housing crisis is a broader issue that requires solutions and sacrifice from all levels of government, Bromberg said.
“There has never been a greater need to get rental housing built across the province. This is why our government is taking steps to tackle the housing crisis so that all Ontarians can have an affordable place to live,” said Peter Bethlenfalvy, Minister of Finance, in a press release.
The province is also calling on the federal government to remove its 5 per cent portion of the HST for certain purpose-built rental housing.
“Our government will continue to take action and work together with our partners at all levels of government to help increase the supply of affordable homes across this province,” said Paul Calandra, Minister of Municipal Affairs and Housing.
While the city works to meet its annual 2,100-unit housing target pledge to get 19,000 new homes built by 2031, market factors are getting in the way of achieving that goal.
Bromberg said the city is hearing from builders that the costs of supply and labour, coupled with high interest rates, are preventing them from getting shovels in the ground.
The City of Cambridge has approved 1,522 dwelling units as of July 31, but building permits had only been issued for 907 units as of last week.
Bromberg feels this announcement, however, will help the city meet those targets and its goal to provide more affordable housing options.
"It's a positive step and certainly welcome for our community."
Increasing rental supply should also bring down sky-high rental costs, Bromberg added.
In other recent news on the city's housing front, the Ontario Big City Mayors Group, of which Cambridge is a member, approached Municipal Affairs and Housing Minister Paul Calandra on Friday to ask him to change the rules around the province's Building Faster Fund.
That provincial incentive program is offering municipalities a portion of $1.2 billion for achieving at least 80 per cent of their annual housing targets by getting shovels in the ground.
The big city mayors, however, want that to be changed to reflect the fact that municipalities are doing everything in their powers to approve developments and issue building permits, but have no power on how quickly developers start to build.
Calandra's office told The Canadian Press it would review the request.
Also last week, the City of Cambridge received council's endorsement of a plan to enter a funding contribution agreement with the Canadian Mortgage and Housing Corporation if the city is successful in its application to participate in the Housing Accelerator Fund.
That program would make the city eligible for over $21 million in federal investments to initiate a $10 million strategic plan to get an estimated 603 new housing units built in Cambridge by 2027.
Bromberg said the city's balance sheet on building approvals and permits is quite strong this year, despite lower than anticipated numbers for new housing. City permits for office and industrial buildings took the lead in 2023 while residental permits lagged expectations.
We need to see an increase in the availability & affordability of rental housing across our community. Pleased to see this step from @PBethlenfalvy, @PaulCalandra & @RobFlackEML this morning & look forward to learning more 🏘️🏗️@mikeharrisjrpc @BR4CambridgePC https://t.co/0uNgfxz73m
— Karen Redman (@Redman4Region) November 1, 2023
