Canada will sponsor a 'rent-to-own' scheme


On Tuesday, Canadian Prime Minister Justin Trudeau revealed the nation’s desire to pursue a rent-to-own housing initiative. Trudeau made the remark while pledging $2 billion in expenditures towards a previously declared objective of quadrupling homebuilding over the next decade.

The money, which had been allotted in past budgets, would be used to aid in the building of about 17,000 new houses throughout the nation. In addition to housing developments that were either subsidized or sold at market pricing, these new residences would include faster-locatable housing for individuals who are now homeless or in danger of becoming homeless.


At a press conference in Kitchener, Ontario, Trudeau said that the project will also support the development and testing of a new rent-to-own model by housing providers. By providing financial assistance, the program attempts to make it easier for Canadians to shift from renting to owning their first home.

Significantly more renters are finding it difficult to save enough money for the first deposit required for purchasing a home. “Through this new program, we will collaborate with housing providers to support families in their transition from renting to homeownership,” remarked the Canadian prime minister. This will be accomplished via collaboration with housing providers.

During the pandemic caused by the COVID-19 virus, interest rates on loans reached all-time lows, and the demand for Canadian homes skyrocketed, resulting in a fifty-percent spike in property prices. However, the recent large increases in interest rates mandated by the Bank of Canada have frozen the housing market. This was done in an effort to reign in runaway inflation. This is the effect of the Bank of Canada’s efforts to reduce Canada’s high inflation rate.

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Fewer potential homeowners are entering the market as it gets more difficult to qualify for a mortgage at acceptable interest rates. This is occurring despite the fact that home prices are declining.

“Tackling housing affordability is a complex problem … simplistic solutions are simply not going to solve the problem,” Trudeau said.

The National Housing Agency of Canada has said that millions of new homes must be constructed by 2030 in order to restore affordability, and the Liberal government of Prime Minister Justin Trudeau has pledged to triple the rate of housing construction over the next decade. The Canadian National Housing Agency has suggested that by 2030, millions of new homes be built. This would make housing more affordable.

However, it may be challenging to develop an affordable housing market given that the number of houses being constructed is at a multi-year high and the construction industry is suffering from a severe labor shortage. This may make it more difficult to create an affordable housing market.

© Thomson Reuters 2022 (Reuters – Ismail Shakil and Steve Scherer)

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