Check It Out: How to keep housing affordable
By Joan Janzen
Finding affordable housing is challenging these days, and this joke is a good illustration ... Because they had such a large family, a couple with twelve children had difficulty finding a house to rent. The crafty husband instructed his wife and eleven of his children to visit the cemetery while he went to visit the real estate agent about a house rental. When the agent asked how many children he had, he replied, “Twelve, but only one is with me.” When the agent asked where the other eleven children were, the man dawned a sad face and told the agent they were in the cemetery with their mother. And that’s how it became possible that the rental agreement was signed.
Lorne Gunter from Post Media commented on the housing situation in Canada. He noted the recent budget announcement of billions being spent on new apartments to build 131,000 spaces would put a bit of a dent in housing affordability.
“The problem is the new program announced is an old program that’s been around for seven years,” he explained. “Instead of building 71,000 units, it built 11,000, but it used 70% of its budget. If they continue on with that they will have no impact on the housing affordability.”
“One of their new projects was in Victoria, B.C. The rent in those units was eleven percent higher than units that were not paid for in this program,” he continued to say. “All the green regulations make the units more expensive.”
House prices in Victoria increased by 71% in the past five years. “It’s based on supply and demand,” Lorne said. “We’ve been restricting supply, and in doing so, the only way for the market to respond is to increase prices. It’s economics 101.”
Tanner Hnidey expressed his opinion on his social media outlet. “It’s not the government’s job to invest in housing where every person lives in the same dwelling structure no matter how hard they work,” he said. “The proper incentives for the private market is profit. If an industry is making profit, it’s a signal for other investors to increase output in that industry, which makes society better off.” He also pointed out that any investment in housing from government is actually an investment paid for by taxpayers.
According to the Canadian Real Estate Association the average rental cost is $2,000/month, and there’s been an 80% increase in immigrants since 2007, with 450,000 immigrants arriving in 2023.
Aaron Gunn released a film discussing the housing crisis. In the film, Mike Moffatt observed, “Ideally, you want house prices to be three to four times income. Historically, that’s what’s been happening. But in Toronto, it’s up to 12-15 times, which is unaffordable.”
John Stovall, President of Reliance Properties, was featured in the film. “From the period of first paper submission to shovel in the ground in some instances has been about 13 years,” he said. “It’s not uncommon now to wait longer for your building permit than it takes to actually build the building.”
The effect of these delays on the cost of developing are astronomical. While waiting construction costs have gone up 35% which creates uncertainly for developers and less people are willing to take on builds. “The developer purchases land with borrowed money and carries that acquisition loan for longer periods of time. Material and labour go up 24% year over year,” John added.
In the film the mayor of Langford, BC relayed how his city managed to keep housing affordable while their population tripled. Holding the position of mayor for thirty years, he said, “We get rid of red tape; we have a fast process. This keeps prices more stable. You can get a building permit in six months, while it takes three to five years in Victoria. If you want a vibrant community, don’t put up a bunch of roadblocks.”
Andrew Lawton from True North observed that people are beginning to get more involved at the municipal level regarding the housing issue. He interviewed Anthony Furey, who said, “When people’s lives are beginning to be affected, they start to get involved.”
Lack of affordable housing, homelessness and rising housing costs are not only problematic in Vancouver, Victoria and Toronto. “Much of these challenges begin at home,” he said. “Helping people get off the streets is good for everyone. There’s great opportunities at the municipal levels to bring about change.”