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Canada’s housing shortage is a long-term problem that’s only getting worse


How bad is Canada’s housing shortage right now? That depends how you measure it.

If you want to be generous, you can shield Canada from comparisons to similar countries and simply ask if we are building enough housing units to keep up with population growth.

Anyone trying to buy their first home in Vancouver, Toronto, Montreal, or Ottawa won’t need charts, graphs and reams of statistics to know the answer to that question.

The ratio of homes to people has been falling for years.

In 2016 there were 427 housing units for every 1,000 Canadians and in 2020 that number had fallen to 424, according to a recent report by Jean-François Perrault, a senior vice-president and chief economist at Scotiabank.

These numbers get even uglier when compared to other countries.

Canada has the lowest number of housing units per 1,000 residents of any G7 country, Scotiabank reports.

France has 540 housing units for every 1,000 residents, the U.K. has 433 and the U.S. has 427. If Canada set the modest goal of simply catching up to the United States, Canadian builders would have to complete an extra 100,000 homes. To catch up to the U.K., it would require an extra 250,000 homes.

To meet the G7 average, Canada would have to build two million extra units.

“To put these gaps in perspective, we have averaged 188,000 home completions in the last 10 years,” the Scotiabank report reads.

Although it’s tempting to attribute the current housing crunch entirely to a perfect storm brought about by the COVID-19 pandemic and record low interest rates, the historical record disagrees. It’s these shortages and the country’s inability to close the gap that are the main driver of record-high housing prices.

“It reflects a long-standing under-production of housing, whether for rent or purchase,” the report reads. This trend stretches across a decade and appears to be untethered from any other short-term trends.

And although housing starts have been off to a strong start in 2021, the problem is only going to get worse.

Although housing starts have been off to a strong start in 2021, the problem is only going to get worse.

Population growth, driven almost entirely by non-permanent residents has been a big factor and will continue to drive shortages as the pandemic tapers off. In Ontario, this is mainly driven by a huge increase in foreign students, according to Mike Moffatt, an economist at the Ivey Business School.

“We need to make sure they, and everyone else, in the province, has a place to call home,” wrote Moffatt, in a series of blog posts about housing issues in Ontario.

And with the federal government proposing to juice Canada’s immigration numbers and introduce a new national child-care system that will boost family incomes and increase the demand for housing, there isn’t much relief on the horizon.

“We know these things are coming. We should learn from the mistake of the last few years: we know demand will rise strongly… yet we also know that the supply response is likely to be hindered by a range of obstacles,” the Scotiabank report argues.

What are the solutions?

The paradox in the housing problem is that many short-term fixes provide temporary relief for some buyers and then exacerbate the problem on the whole. For example, in 2019 the federal government boosted the Home Buyer’s Plan and introduced a first-time home buyer’s incentive that critics argued would simply lead to more personal debt and inflated house prices.

The report from Scotiabank offers a few long-term solutions. The most obvious one is cash from the federal government to spur local governments. For example, the federal government could tie future transit funding to density objectives or to clearing red tape in the planning approval process.

The report also recommends that the federal government bring together people from across the country, including provincial and municipal officials, builders and developers, and civil society organizations to offer solutions on a short timescale.

Most of all, the report recommends that Canada’s housing issues be treated like a national priority, with resources that match the scale of the challenge.

Go West

While Canada’s housing problems sprawl across the country, leaving cities like Vancouver, Toronto and Montreal at the bottom of multiple affordability rankings, there are some places of refuge.

Edmonton is the highest ranked Canadian city on the Demographia international housing affordability index at 17th place and Calgary is similarly well-positioned at 29th out of 92 cities.

For perspective, Vancouver is second-last on the list, right before Hong Kong and four spots below Toronto.

Bill C-10 is unpopular but barely anyone knows about it: Poll


There’s good news and bad news when it comes to polling on the government’s Bill C-10, which would require online services to promote the creation of Canadian content.

The bad news for the government is that most of the people who have heard of the bill disapprove of it.

The good news, then, is that barely anyone is aware of the controversial bill now winding through Parliament.

Fewer than three in 10 Canadians have even heard of the bill and that number rises to four in 10 among Conservative Party supporters, according to a poll by Public Square and Maru/Blue of 1,508 Canadians on the weekend of April 30, 2021.

A whopping 72 per cent of Canadians are either vaguely aware of the bill or have no knowledge of it at all. Forty percent of Canadians fall into the latter category, having never heard of the bill.

Of those Canadians who are aware of the bill, 11 percent are very supportive of it and 20 percent are somewhat supportive. Fifteen percent are somewhat unsupportive of Bill C-10 and 38 percent are very unsupportive. Ten percent are unsure.

On Monday, MPs on the heritage committee voted to send the bill to the justice minister for a second charter review amid concern about its effect on free speech. And a series of confusing statements in interviews by Heritage Minister Steven Guilbeault has added to the growing discontent with the bill.

On the weekend, Guilbeault said the CRTC may regulate YouTube accounts with a large following for CanCon requirements, before backtracking the following day. Recent changes to the bill removed an exemption for social media accounts, causing a new round of backlash and fear that the government would be cracking down on the internet activity of individual Canadians.

“It will ensure all Canadians communicating on the internet will do so under the guise of the state,” said Peter Menzies, a former vice-chair of the Canadian Radio-television and Telecommunications, at a panel discussion about Bill C-10 hosted by the Macdonald-Laurier Institute on Tuesday.

“There is no crisis in the Canadian cultural industry and the government doesn’t seem to understand what it is doing,” said Menzies.

Menzies dryly noted that the government is trying to put the internet under the auspices of the CRTC, emphasizing the words “television” and radio” in the name, and joked that “they are referring to this as modernization.”

Other panelists worried about capricious enforcement under the proposed new regime. Radio host Jamil Jivani urged left-leaning people to consider that one day a government they don’t like — maybe even someone like former U.S. President Donald Trump — could be holding these powers.

“There’s a lot of reasons to hold big tech accountable,” said Jivani. “And if you want to hold these companies accountable, there are much better ideas than what the Trudeau Liberals have put forward.”

Jivani said that given the lack of any meaningful ideas from the government to crack down on big tech, he could only conclude that Bill C-10 is a powergrab.

With some interpretations of the bill suggesting the algorithms that run sites like Twitter and YouTube would have to be quietly tweaked for compliance, it could lead to “shadowbans” of popular and controversial commentators, said Jen Gerson, an Albertan journalist and editor at The Line.

“If you’re an average Canadian looking on YouTube, these really popular commentators would just never show up for you. That’s where we’re getting into a dangerous space where the regulator is putting its thumb on what people can access,” said Gerson.

The removal of the social media exemption has kicked off a debate on free expression and, on that issue, Canadians overwhelmingly support free speech.

Asked to choose between free expression for individuals and promoting Canadian content on social media platforms, 73 percent of Canadians choose free expression.

The polling questionnaire was designed by Public Square Research in partnership with Maru/Blue. The research involved an online survey of 1,508 Canadians from the Maru Voice panel and the survey was fielded on the weekend of April 30, 2021.