Stephen Harper told mounting mortgage debt is putting ‘our national economy at risk’
Canada’s cities say that mounting mortgage debt held by cash-strapped Canadians is putting “our national economy at risk,” and they have urged Prime Minister Stephen Harper, in a letter, to use his government’s upcoming throne speech to set the stage for an agenda to help bring down housing costs in their communities.
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According to Statistics Canada, about one-quarter of Canadians are spending too much on housing costs.
The letter, dated Oct. 1, also calls on the government to pursue its new 10-year multibillion dollar infrastructure plan as well as follow through on a recent commitment by Transport Minister Lisa Raitt to address public safety concerns about the transportation of dangerous goods in the aftermath of the Lac-Megantic runaway train disaster and other accidents.
But the Federation of Canadian Municipalities, made up of member cities representing 90% of the nation’s population, said in the letter that the high cost of housing was the most “urgent” financial issue facing Canadians today.
The letter noted that total mortgage debt added up to $1.1 trillion, despite some of the steps “rightly taken” by the government to manage risks in the housing sector. It said this meant that one out of four Canadians was paying more for housing than they could afford.
“Housing costs and, as the Bank of Canada notes, household debt, are undermining Canadians personal financial security, while putting our national economy at risk,” said the letter to Harper, signed by the federation’s president, Claude Dauphin, the mayor of the Montreal borough of Lachine.
“As it stands, for those who cannot afford to purchase a home, the short supply of rental units is driving up rental costs and making it hard to house workers in regions experiencing strong economic activity.”
The letter also said that an inadequate supply of subsidized housing for those in need was pushing the most vulnerable Canadians on to the street.
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