Months after acknowledging that home construction in Ontario was at a “standstill,” the housing minister is hoping the latest set of government interventions will lead to a spring market revival.
While issues with homebuilding in the province have festered for years, housing starts in 2025 plummeted even further as potential buyers sat on the sidelines, hoping to wait out unaffordable prices, leading to a slump in pre-construction sales.
The dip has put the Ontario government so far off its mark to build 1.5 million homes that Finance Minister Peter Bethlenfalvy recently acknowledged that the goal is no longer a “hard target.”
To change the equation, the government tabled another housing bill in October that, taken with other measures, aims to kickstart construction in early 2026.
“If you take a look at Bill 17 and now Bill 60 … we’re creating the conditions for next spring. We really are setting up for success for next spring,” Housing Minister Rob Flack told Global News.
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Bill 17 paved the way for development charge (DC) deferrals — a major change that allows developers to pay municipal fees when the property is handed over to the buyer, rather than when the building permit is issued.
While the legislation was tabled in early June, regulations that enforce the law were only approved in November, making it mandatory for municipalities to defer the charges.
“If you have to pay these costly DCs up front, that takes away from being able to get shovels in the ground. It’s costly,” Flack said.
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“It’s hard out there. We’re in a housing crisis, so the more cash flow we can free up for them to get building, the sooner we get more houses built and the cost will come down.”
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Then, in late October, the province tabled legislation (Bill 60) aimed at streamlining approvals and site plan control, which, the province said, would create consistent standards for parking and landscaping requirements, while lowering costs for building.
The Fall Economic Statement also offered first-time homebuyers a new incentive to get into the market.
The province announced it would waive the provincial portion of the HST for new homes under $1 million, mirroring the federal plan announced in the Carney government’s November budget.
The combined incentives, the province said, would save prospective first-time homebuyers up to $130,000 off the cost of a new home.
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The Ford government is hoping those measures, coupled with lower interest rates, can breathe new life into a struggling home construction sector.
“What I’d like to see is more housing starts, more housing projects on the go,” Flack said. “We’re setting it up for next year.”
The building industry, however, remains skeptical that the plan will actually work.
“2025 has been a very bleak year for builders in Ontario and, unfortunately, by extension, for home buyers as well,” said Scott Andison with the Ontario Home Builders Association.
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While the association said the government was finally taking a large system-wide view of housing development and looking for potential barriers to overcome, it’s still missing the mark for 2026.
“The first-time homebuyer exemption in Ontario will have very little effect, less than five per cent,” Scott Andison said.
“We need a very specific Ontario-led approach and that is to remove the provincial sales tax off the price of all new home purchases.”
Andison said the association is pressing the government to “pull the lever” as soon as possible in order to “rejuvenate the industry” in 2026.
While Premier Doug Ford has expressed interest in extending the sales tax discount on new homes for all buyers for a time-limited period, the finance minister shot down the proposal, citing costs.
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Flack, meanwhile, says the work isn’t complete.
The province has been looking to overhaul its Building Faster Fund, a $1.2 billion pot of money designed to reward municipalities for meeting housing construction targets set by Queen’s Park.
Mayors complained the program is fundamentally flawed because it focuses on housing starts, which are out of a municipality’s control, rather than permits issued which are firming in a town or city’s domain.
Flack told Global News that metric, too, is subject to change.
“We’re working closely with our municipal partners. We want to come up with a new housing, building faster fund. Again, coming up with different metrics that can help support them, support our builders,” Flack said.
While Flack has shied away from touting the government’s promise to build 1.5 million homes by 2031, any improvement, it seems, is worth the effort.
“It’s about shovels in the ground, it’s the results, and that’s what we’re trying to create those conditions to see those results.”
© 2025 Global News, a division of Corus Entertainment Inc.
