The right to housing

Housing all Canadians affordably is a problem that supply alone will not fix

In his book, Evicted: Poverty and Profit in the American City, Prof. Matthew Desmond wrote that “…home is the wellspring of personhood.”

I couldn’t agree more. 

When the pandemic took hold in spring 2020 the only remedy offered to us was to stay home. No medicines, therapies, or other strategies were known - a literal safe house was our only proposed solution. But for many Canadians, home was overcrowded, unsafe, or unavailable. 

Fast forward to now: Summer 2021. There is hope that the pandemic in Canada is close to over. 

As we inch closer to “normal” two things will dominate backyard bbq conversations as the sun sets on our two-dose summer: 

• a seemingly unavoidable federal election

• and soaring housing prices throughout Canada

The need for new supply

As we debate housing prices it becomes clear that we have a need for new supply: 

• There are 424 housing units for every 1000 Canadians, the lowest rate in the G7

• Canada needs 1.8 million housing units to meet existing population levels 

• Canada is projected to welcome 1.2 million newcomers/immigrants by end of 2023

• Over 1 in 10 renters (13.5%) nationally—or 628,700 Canadian households—were living in social and affordable housing in 2018.

• Over one quarter of a million households, representing 1.9% or 283,800 Canadian households, had at least one member on a waiting list for social and affordable housing. Of these households, almost two-thirds (61.2%) or 173,600 households were on a waiting list for two years or longer.

Supply, however, is only part of the equation.

Housing is a climate + economic development + equity + financial stability problem all in one.

The lack of choice in cities forces people to far flung exurbs. Low density + longer commutes = higher energy needs = more fossil fuels burnt. Not to mention longer commutes make us less health and less happy.

Households with big debt loads are less able and willing to start companies due to high recurring costs (therefore need to stay in current job) and lower financing availability. Lower housing costs would mean more people have the capacity to start businesses and gives people the opportunity to take bigger risks if their costs are low.

More choice in cities mean a wider variety of people can live and work in high growth population centres, which in turn creates denser networks of creative people. This type of agglomeration will lead to innovation and growth.

Financialization of Housing

Canada’s housing market has become a financial market. While housing has always partly been a financial product, undersupply makes it a speculative one. Canada needs policy that understands that housing should be about housing people first - that housing ought not to be primarily a speculative investment vehicle. 

Put another way, why do we need to increase supply? To house people. 

The financialization of housing must be addressed by bold agenda that envisions a density-positive city with better visualization, addressing zoning and providing the sorely needed political leadership to combat NIMBY-ism.

Otherwise, more supply will just multiply our existing problems.

Some have proposed a maximum amount a person could make off real estate sales (either max $ figure or max number of sales) before being taxed on their principal residence. We should go further and create exemptions that incentivize the creation of more density. eg. Exempt a $3 million house in Vancouver if it gets torn and replaced by a triplex.

Give people incentives to self-densify. Eg. Tax exemptions up to a cap for renting out a secondary suite, or grants and cheap loans to make secondary units.

Basically the government can use finance to incentivize good behaviour. 

Whatever the solutions are, we need to discuss them at all levels of government in this country, or we will maintain the status quo of unaffordable housing due to undersupply and a broken housing finance model.