Housing and the high cost of living are prominent issues for Ontario citizens, and the newly released 2024 Ontario Budget reflects the heightened burden felt across the province. Featuring measures to address the housing deficit and amp up purpose-built rental construction, proposed action steps range from investing $1 billion in the new Municipal Housing Infrastructure Program to a commitment to supporting key solutions like transit-oriented development and modular construction.

“In the face of global economic uncertainty and high interest rates that continue to put pressure on Ontario families, our government is taking a responsible approach by investing to rebuild Ontario’s economy without raising taxes,” said Finance Minister Bethlenfalvy. “As we invest in key public services and infrastructure, including new roads, highways and the largest public transit expansion in North America, we refuse to offload the costs onto hardworking Ontario families or municipalities at a time when they’re counting on us to keep costs down.”

Calling the 2024 Ontario Budget “a step in the right direction,” Ontario REALTORS issued a statement thanking the Ford government for putting forward a strong fiscal foundation. That said, the association also cautions that more urgency is needed, pointing out that to reach its goal of building 1.5 million new homes by 2031, the government must keep its foot on the gas and “take bold action” via steps like modernizing zoning to support commercial-to-residential conversions, allowing for greater density along transit corridors, and eliminating exclusionary zoning.

”Building more homes on existing properties is an essential key to unlocking affordable homeownership,” said Tim Hudak, CEO of the Ontario Real Estate Association. “Several municipalities, including Toronto, London, and Barrie, have led the way by proactively enabling four units as-of-right per lot, and it remains a key recommendation of the Province’s own Housing Affordability Task Force.”

Tony Irwin, President and CEO of the Federation of Rental Housing Providers of Ontario (FRPO), also expressed support for the 2024 Ontario Budget, calling the investments encouraging for the rental housing sector.

“FRPO is pleased to see the government make significant investments in Ontario’s infrastructure in Budget 2024,” he said. “Through initiatives like the $1 billion Municipal Housing Infrastructure Program, Ontario is helping communities to accommodate new neighbours and support higher-density housing. Also, enabling municipalities to reduce the property tax rate for purpose-built rental housing will provide much-needed relief for many residents, and is welcome by FRPO members who are committed to building more rental housing right across Ontario. Together, we can ensure all Ontarians have access to safe and affordable housing.”

Purpose-built rental development 

Of course, one of the most promising measures for rental housing developers was introduced last fall when Ontario announced it would be removing the full eight per cent provincial portion of the HST on qualifying new purpose-built rental projects. This move has already helped trigger the construction of new rental housing across the province, as indicated by the latest CMHC data that shows a record-high number of rental housing starts in 2023.

The enhanced relief applies to any new purpose-built rental housing project, such as apartment buildings, student housing and senior residences, built specifically for long-term rental accommodation. Qualifying projects that began construction on or after September 14, 2023, and on or before December 31, 2030, and complete construction by December 31, 2035, may benefit from this cost savings measure.

Highlights of the Province’s actions include:

• Helping to get more homes built by investing $1 billion in the new Municipal Housing Infrastructure Program and quadrupling the Housing-Enabling Water Systems Fund to a total of $825 million to help municipalities repair and expand the critical infrastructure needed to reach their housing targets.
• Addressing Ontario’s housing supply crisis by rewarding municipalities that achieve their housing targets with funding from the three-year, $1.2 billion Building Faster Fund.
• Helping to build Ontario’s end-to-end electric vehicle (EV) and battery supply chain through upwards of $28 billion in automotive and EV battery‐related investments from global automakers, parts suppliers, and EV battery and materials manufacturers, which are expected to create more than 12,000 new permanent jobs.
• Connecting approximately 600,000 people to primary health care with a total additional investment of $546 million over three years.
• Launching a new $200 million Community Sport and Recreation Infrastructure Fund to strengthen communities across Ontario by investing in new and upgraded sport, recreation and community facilities.
• Investing $46 million over three years, including for the purchase of four police helicopters, to improve community safety in the Greater Toronto Area by supporting increased patrols and faster response times to major incidents and serious crimes.
• Keeping costs down for people and businesses by proposing to extend the temporary cuts to the gasoline tax rate by 5.7 cents per litre and the fuel (diesel) tax rate by 5.3 cents per litre until December 31, 2024. This would save Ontario households $320 on average since the cuts were first introduced in July 2022. This relief is especially important as the federal carbon tax is set to increase on April 1, 2024.
• Helping workers and job seekers, including apprentices, get the skills they need to advance their careers with an additional $100 million investment in 2024–25 through the Skills Development Fund Training Stream.
• Supporting individuals facing unstable housing conditions and dealing with mental health and addictions challenges by investing an additional $152 million over three years towards various supportive housing initiatives designed to support vulnerable people.

“Our responsible approach allows us to support Ontario families, workers and municipalities while retaining a path to balance,” said Minister Bethlenfalvy. “We will keep investing prudently to help create stronger communities and better opportunities for future generations.”

Click here for more on the 2024 Ontario Budget.