Many Canadians need time to build their savings before buying a home. Rent remains one of the largest household expenses, and right now, there are few options for people who want to become homeowners to leverage the rent they pay towards a home purchase.
Under our plan, we will introduce a new Rent-to-Own program to help make it easier for renters to get on the path towards home ownership while renting. We will commit $1 billion in loans and grants to develop and scale up rent-to-own projects with private, not-for-profit, and co-op partners. Under a typical rent-to-own model, an individual commits to renting a property for a period of time with the option of buying it at a locked-in price before the end of the lease, to allow them to save for a downpayment.
Under our plan, we will work with partners, so that as they build, they are able to set-aside a portion of new housing stock for rent-to-own. We will also create a stream for current renters and landlords, particularly those in condo settings, to immediately enter into a rent-to-own agreement.
We will design the program to support projects with these three principles:
- The landlord must commit to charging a renter a lower-than-market rate to help Canadians build up savings for a downpayment;
- The landlord must commit to ownership in a five-year term or less; and
- Proper safeguards will be in place to protect the future homeowner.