Federal Finance Minister keeping a close eye on housing affordability

Bill Morneau says getting people into affordable homeownership is top of mind, and that Liberal Party won't compromise stability of the market

Finance Minister Bill Morneau, who has been meeting with business groups around the country leading up to a budget speech expected within the month, told reporters in Victoria February 8 that housing is very much top of mind.

Morneau said he wouldn’t go into specifics, but his department is thinking about affordable housing and how people can get into the market at all levels.

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He said they won’t act if it compromises the health and stability of the market.

There have been rumours the federal government was considering allowing would-be homebuyers to once again access 30-year insured mortgages — up from the current 25-year limit — or tweaking the stress test currently in place for would-be homebuyers.

“I’m not sure there will be direct measures [in the budget], and I certainly don’t have anything to announce now,” he said in an interview after the speech.

According to real estate experts, rising interest rates and the stress test have resulted in a significant drop in home sales in places such as Victoria, Vancouver and Toronto.

“I realize the housing market is so important and we are concerned about protecting people’s investment,” he said, arguing the initiatives in place have also created an environment that is more affordable and stable.

“The [Office of the Superintendent of Financial Institutions] will continue to look at the stress test to make sure it’s having the desired effect, and we will continue to make sure we monitor and look at the markets,” he said.

He said the spectre of money laundering in the B.C. housing market has the government’s full attention as it can have an impact in many facets of the economy.

Morneau noted the federal government’s focus broadens to look into activities that could finance terrorism. “You’ll see us working with the province to consider what measures we can take to make sure there are not inappropriate activities going on,” he said. “It’s a very active file.”

Reports last year from an international anti-money-laundering organization and a RCMP intelligence team concluded some B.C. casinos and luxury Metro Vancouver home sales were being used to filter money by organized crime groups.

B.C. Attorney General David Eby has said the fight against money laundering requires the combined efforts of the provincial and federal governments and law enforcement agencies.

Earlier Friday, Morneau held court with the Greater Victoria Chamber of Commerce and answered questions ranging from work on childcare, housing and Brexit to U.S. President Trump and the federal deficit.

He was asked about the federal government’s commitment to immigration as a means to address labour-market shortages.

Morneau said immigration is a good source of talent, and he pointed out the government has increased the number of people accepted each year. But the country has to look at other options, he said.

“The [attraction and retention of] talent issue is significant in a place where the economy is doing as well as it is in Victoria,” he said.

He said there’s more to do, especially to prepare workers for an economy that changes quickly.

He said the federal government has a role to play in helping young people get the experience they need to be effective in the workforce, and to help workers retrain to keep up with change.

“We will be talking about that in the budget and in the election campaign,” he said. “The speed of change in our economy is huge, things move so rapidly. Jobs that were around for a generation are now around for a decade. There will be continued volatility and we want to address that.”

Morneau may have been out of Ottawa, but he couldn’t escape questions about whether pressure was put on then federal Attorney General Jody Wilson-Raybould to help SNC-Lavalin avoid prosecution.

He said calls for an investigation are pointless.

“I don’t think there’s anything to investigate. The prime minister was clear, there was no direction from his office nor from him,” he said. “I’m left in a situation where I’m just responding to an allegation that has no substance.”

aduffy@timescolonist.com

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