Reclaiming the Canadian Dream of Home Ownership

Fausto Gaudio, President & CEO, Italian Canadian Savings Credit Union

Δημήτρης Βοχαΐτης - LJI Reporter
Canada’s housing market, once a cornerstone of stability and opportunity for families, is now precariously close to becoming commoditized. With speculative investments dominating the sector, the dream of homeownership has become increasingly unattainable for many Canadians. Fausto Gaudio, president and CEO of the IC Savings & Credit Union, in a recent submission to the House of Commons Standing Committee on Finance, a proposal was made to implement a fiscal measure: a punitive capital gains tax on speculative investments in single-family homes held for less than two years. The objective is clear and vital  - to prioritize families over profit in the housing market.
A Market Transformed by Speculation
Over the past decade, the real estate landscape in Canada has undergone a significant transformation. Speculative investors have redefined the market, particularly in the Greater Toronto Area (GTA), where their influence has been most pronounced. By 2019, industry reports indicated that up to 80% of high-rise condo purchases were attributed to speculators. This speculative fervour has pushed demand -and, consequently, prices- far beyond the reach of average Canadian families. This dynamic has fundamentally altered the accessibility and purpose of housing, turning homes into financial instruments rather than spaces for living.
Speculators, often motivated by short-term financial gains, approach housing with a fundamentally different perspective compared to families seeking stability. This divergence has led to a troubling shift in the housing market, particularly for detached suburban residences, which have increasingly become financial instruments rather than homes. Even private equity funds have entered the market, amassing extensive portfolios of single-family homes to profit from rising property values. This has further marginalized families, who struggle to compete with the financial power of large investors.
The Ripple Effects of Hyper Demand
The dominance of speculative activity has created significant ripple effects throughout the housing ecosystem. Developers, benefiting from inflated profits—reportedly as high as $400,000 per unit in some cases—have passed on these increases to contractors, labour unions, material suppliers, and municipalities, all of whom have adjusted their costs and demands accordingly. This cycle has driven construction costs to unsustainable levels, compounding affordability challenges for everyday Canadians.
While the rapid interest rate hikes of 2022 temporarily subdued speculative activity, they left the market burdened with unsold inventory. Estimates that the Greater Toronto Area (GTA) currently has 40,000 unsold condo units, a backlog that may take up to four years to absorb. As interest rates begin to stabilize, the potential for a resurgence in speculative activity looms large, posing further risks to housing accessibility for families.
From Homes to Commodities
The increasing commoditization of housing has far-reaching implications for the broader economy. The traditional stability of mortgage financing, long reliant on the predictability of real estate values, faces mounting challenges. Should housing prices continue to behave like commodities, lenders may shift toward margin loan-style mortgages, where volatility and price fluctuations introduce significant uncertainty for homeowners. This shift would fundamentally undermine the financial security associated with fixed-rate mortgages and long-term amortization periods, leaving families more vulnerable in an already precarious market.
The federal government, through the Canada Mortgage and Housing Corporation (CMHC), plays a significant role in underwriting residential mortgages, assuming considerable financial risk on behalf of taxpayers. A housing market characterized by volatility and commoditization poses serious challenges, particularly if declining property values trigger a rise in mortgage defaults. Such a scenario would place a heavy burden on public funds, further amplifying the urgency for structural reforms.
A fiscal solution for families
Relying solely on interest rate policy has proven inadequate in addressing the long-term impacts of speculative behaviour in the housing market. A more precise fiscal intervention, such as a significant capital gains tax on the flipping of single-family homes, emerges as a practical and effective solution. This measure would discourage short-term speculation, stabilize market demand, and help moderate construction costs. Crucially, it would reestablish equilibrium in the housing market, ensuring that homeownership becomes a realistic goal for families and first-time buyers once more.
The Canadian dream of homeownership transcends individual aspirations; it represents a cornerstone of the nation's social and economic stability. Without bold and decisive action, that dream risks becoming a privilege reserved for the wealthy, alienating large segments of the population. Policymakers must prioritize initiatives that treat housing as a fundamental human need rather than merely a financial asset to be exploited.
A call to action
The challenges of housing affordability and accessibility are not abstract policy debates - they are pressing realities affecting countless Canadian families across all demographics. Speaking to the Greek Press, the proposal’s advocate emphasized by saying “Housing is a human right, and its commodification undermines the very foundation of our communities. A punitive capital gains tax on speculative investments is not just a fiscal tool; it is a moral obligation to restore fairness and opportunity in the housing market.”
In a statement to the House of Commons Standing Committee on Finance, he urged immediate and decisive action underlining “Let us act now to protect the Canadian dream of homeownership and ensure it remains within reach for generations to come. The time for complacency has passed - it is imperative that we safeguard housing as a cornerstone of our society, for Canadians of all communities, including the Greek diaspora.”
This approach underscores the urgent need for comprehensive reforms that go beyond surface-level adjustments, advocating for policies that prioritize fairness, accessibility, and long-term social stability in the Canadian housing market.

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