Corporation’s plan to purchase St. Catharines real estate slammed

Local politicians contend it will drive up prices in an already expensive market

Niagara’s elected leaders are outraged over a corporation’s plan to convert residential homes into rental units in a community already struggling with a shortage of homes and increasing real estate prices.

“Definitely, there’s a concern there,” said St. Catharines Mayor Walter Sendzik, who also heads up Niagara Regional Housing.

“We’ve got a corporation that is pursuing profits in the rental market ... which will only put further pressure on the limited availability of single-family homes in our community.”

Toronto-based Core Development Group plans to buy $1 billion worth of single-family homes and turn them into rental properties in St. Catharines and other medium-sized cities across Ontario, including London, Kingston, Hamilton, Barrie, Cambridge, Peterborough and Guelph.

Sendzik said the “threat is that it erodes the affordability for young families being able to access a family home. It threatens to drive up rental costs in our community’s already tight rental market.”

There is already a years-long waiting list at Niagara Regional Housing for affordable housing, he added.

He said Niagara isn’t alone. “If you look at the areas the company has targeted, they’re all facing the same pressures that are being faced in Niagara. We have some of the lowest number of single-family homes in decades. They’re building in Niagara, but we’re behind, and the home prices have gone up by almost 25 per cent year over year,” Sendzik said.

“This is my concern, with a private equity company looking to get into this kind of rental market. It’s a large conglomerate of companies with billions of dollars looking to maximize the opportunity to generate income on a monthly basis, and they’re doing it to the disadvantage of young people looking to get into the market as homebuyers.”

He said it will further push the dream of home ownership out of reach.

“You have this kind of predatory nature of businesses that

are going to create market conditions that push young people further out of the housing market,” he said. “That’s not good for society.”

Sendzik said there’s little municipalities can do to address the issue, adding it needs to be handled by upper-tier governments.

St. Catharines MPP Jennie Stevens is raising the issue at Queen’s Park.

The New Democrat wrote to Premier Doug Ford on Thursday, demanding action.

“I am requesting that you immediately take action to stop Core Development Group — and other massive property ownership and speculation corporations — from profiteering during the housing crisis in Niagara and across Ontario,” she wrote.

Her letter echoed several of the issues raised by Sendzik, such as driving up housing prices in communities already struggling with affordability.

She said it will also “force young people to leave this community to find an affordable home, leaving parents to watch as their kids have no choice but to leave the community they were raised in.”

“Investors are already mass evicting entire apartment buildings of long-term Niagara residents, often seniors, to hike rents and increase profits. Houses in Niagara are already facing bidding wars. The problem is out of control, and families — especially young families — are paying the price.”

Stevens urged Ford to adopt the NDP’S plan for increasing the Non-resident Speculation Tax to 20 per cent from 15, and expand it to apply everywhere in Ontario while closing loopholes for real estate speculators.

“The risk of doing nothing is too high, when it is clear billionaire investors are buying up properties in my community already, and jeopardizing the dream that parents have for their children to live in the same community,” she wrote.

The company did not respond to an interview request Friday, but speaking to the Toronto Star this week, Core founder Corey Hawtin defended the plan to purchase single-family homes.

He said the company is buying far less than one per cent of the homes that trade in the Ontario market on a yearly basis.

“I really, deeply sympathize with people aspiring to own homes across Canada, but simply can’t afford to do so,” said Hawtin. “We’re trying to provide an environment where our tenants — that’s young families, students, divorcees — can rent a place and get an experience within a neighbourhood that they can’t afford to buy in.”

Hawtins said the company is not participating in bidding wars for the homes it purchases, adding most are already rental homes.

“There’s a compounding percentage of the population that are renters. And whether they are renters because they can’t afford to buy, or because that’s the lifestyle they choose, the rental marketplace is exponentially growing on a demand basis. And it will for the foreseeable future,” he said.