Improving housing affordability needs a multi-pronged approach

Would a Minister of Housing be able to address issues across the housing continuum?

Improving housing affordability needs a multi-pronged approach

T-minus 11 days left until the federal election and while housing affordability isn’t the top issue for voters (that spot belongs to climate change, according to a poll from the Angus Reid Institute), affordability remains a high priority.

In this week’s housing debate, representatives went deeper on a number of key issues. More than anything else, however, the debate highlighted what a complex and multifaceted issue housing is.

“There is no one-size-fits-all, there is no one magic bullet and the crisis and the issues that people are facing in housing are going to require a whole bunch of measures to be taken,” said Jeff Morrison, executive director of the Canadian Housing and Renewal Association. “You’ve got to do a whole bunch of things, and simply focusing on reducing the stress test is simply not enough if we want to take that full spectrum approach.”

Kevin Lee, CEO of the Canada Home Builders’ Association, said that the discussion of concerns across the full housing continuum from homelessness to homeownership allowed a separation between the topics of housing affordability and affordable housing, which are often conflated. More importantly, he said, there was a distinction made between home ownership as debt and home ownership as an investment.

“We’ve been advocating for adjustments to the stress test and a reintroduction of 30-year mortgages for first-time buyers really to get millennials and new Canadians into the market and give them a fair shot, and I think that’s been misconstrued by many as, ‘oh, we’re just trying to pile on more debt for Canadians,’” Lee said. “A couple of the [representatives] pointed out really well that when buying your first home and getting into the housing market, you’re talking about investment, which is totally different than other types of what someone might want to call bad debt.”

Pierre Poilievre reinforced the Conservative reliance on the private sector to address a lot of housing issues; Adam Vaughan reinforced what their new government would do regarding Indigenous housing; and the NDP, Green, and Bloc parties all reinforced messaging that there needs to be less emphasis on homeownership and more emphasis on affordable rental space.

Lee said that people need to remember that there’s a housing continuum. There’s a need for social housing and a need for market rate housing that people can afford with their incomes, but in order to have people move through that continuum and not get stuck, there’s a need to fix housing affordability.

“As long as housing affordability and market rate housing affordability continues to deteriorate, you put more and more pressure on the other parts of the continuum that people are trying to move through. As a perfect example—right now, because first time buyers have been locked out of the market, we’re seeing a lot of pressure on rental supply, because 80% of rental units that would normally come available in any given year come from people becoming first time homebuyers and vacating those properties. So the inability of people to move out of rent that want to is stagnating the whole system. That works its way back, all into social housing and various forms of housing assistance, it creates a tighter market all the way through the system. You can’t just build your way out of the social housing challenges; you need to get the people who should be able to afford market rate housing—both homeownership and rental—into those properties,” Lee said.

CHBA has been advocating for supply, but also indicating that there needs to be some adjustments to the mortgage rules to help unclog the system while more supply comes online.

Morrison said that he hopes these in-depth housing debates will continue even after the election. He also added that whatever party forms the new government might consider creating a new position that would help facilitate the multi-pronged approach necessary to fix housing affordability on all levels.

“One thing we would hope is that whoever forms the next government, they appoint a dedicated Minister of Housing, because these are complex issues and they cross-cut a lot of other government departments, including environment, including health, including Indigenous services. So having a dedicated minister would be helpful, to be a point person that could bring all these strands together.”