In light of the significant headwinds facing Ontario’s new‑home building sector, the Residential Construction Council of Ontario (RESCON) is calling on federal, provincial and municipal governments to permanently eliminate the HST on new‑home purchases, reduce development charges, adopt a more sustainable approach to municipal infrastructure funding, and accelerate planning approvals through digitization and other modernized review processes.

“The residential construction sector continues to contend with a challenging market, due to stifling taxation and government‑imposed costs, rising rates for material and labour, as well as cumbersome planning approvals and overly restrictive regulatory policies that hamper the industry,” said RESCON president Richard Lyall. “This has led to a dramatic downturn in housing construction and job losses, harming both the industry and the broader economy.”

While RESCON says it is encouraged by recent federal and provincial policy decisions — including interim HST rebates and time‑limited actions on development charges — it stresses that both measures must be made permanent to help get the industry back on track.

“We need a rebalancing of the housing supply system and a return to the long‑standing benchmark of homes costing roughly four times a household’s income,” Lyall said.

RESCON’s pre‑budget submission outlines 10 recommendations, including:

• Permanent HST relief — either fully removing HST from new‑home purchases or reinstating the original indexing mechanism in the Goods and Services Tax.
• Sustainable municipal infrastructure funding — shifting costs away from new‑home buyers and toward the broader tax base across all levels of government.
• Modernized planning approvals — federal and provincial support for digitization, building information modelling, standard designs and expanded as‑of‑right building modalities to streamline approvals and reviews.

According to Lyall, housing will take on heightened importance as the federal government advances its nation‑building agenda involving major energy, defence and infrastructure projects. Affordable housing, he notes, will be essential to accommodate the skilled labour required to deliver these initiatives.

The Toronto metropolitan area is already losing young families and entrepreneurs due to affordability pressures. Between 2024 and 2025, the region posted a population decline. In the City of Toronto, the number of children under five fell by 12 per cent between 2011 and 2021 due to ongoing affordability and supply challenges.

For RESCON’s full list of recommendations, click here.