How does this work?

Entrants are asked to consider our inaugural topic and challenge below, then provide a short synopsis of their policy proposal. All entries will be adjudicated by an esteemed panel of judges, including Jennifer Keesmaat, Evan Siddall, Ben Rabidoux, Mike Moffatt, and Amanda Lang. The judges will select 10 finalists to further refine and develop their ideas before vying for $50,000 in cash prizes and the chance to translate their idea into actionable public policy. The Hunter Prize is open to those 40 years of age or younger as of December 31, 2024.

The Problem

A “wicked problem” is an issue or challenge that is difficult to solve for three reasons: (1) it involves interconnected economic, cultural, and social factors, (2) it tends to be long-term in nature, and (3) its possible solutions can be contentious due to entrenched thinking and interests.

Canada is in a housing affordability crisis. The average home price nationally increased by nearly 45 percent between 2018 and 2022 alone. Major cities such as Toronto and Vancouver are now among the least affordable in the world.

Consider the following:

• Since the start of 2005, Canadian home prices are up by 142 percent on a real basis—compared to just 26 percent in the United States.
• National Bank estimates that the qualifying income required to buy a typical home in the Greater Toronto Area is $225,042—which means that a family must be in the top ten percent of income earners to qualify for a typical mortgage in the GTA.
• Canada is now home to the highest house-price to income ratio in the G-7 and second highest in the OECD.
• Average rental prices in Canada have also seen a significant increase in recent years. The average one-bedroom apartment in Toronto and Vancouver is $2,802 and $2,592 respectively and for two-bedroom units, it is $3,370 in Toronto and $3,918 in Vancouver. To put that in perspective: the median after-tax income in Canada is about just under $69,000, so rent in these cities would represent between 58 and 68 percent of the median’s family’s or individual’s after-tax income.

These housing affordability challenges are inherently multicausal. Some of the contributing factors include:

• An unprecedented low-interest rate environment for more than a decade which put upward pressure on housing demand.
• Federal and provincial policies that have increased housing demand (such as subsidized mortgage insurance and tax incentives).
• Large-scale increases in immigration—including permanent residents and non-permanent residents (such as students and temporary foreign workers)—that boosted the country’s population by 1.25 million in 2023 alone.
• Provincial and local rent controls which are shown to constrain the supply of new units and drive up prices.
• Local land use and zoning policies that have driven up the cost of housing construction and limited the growth of housing supply such that Canada is now home to the fewest homes per capita among G-7 countries.

Solving Canada’s housing affordability crisis will therefore require public policies that aim to address both sides of the housing equation and get at these underlying policy factors.

But what makes it such a wicked problem is that its consequences are far reaching including causing labour market distortions, undermining economic activity, and creating political tensions among generations and regions.

The Challenge

That is why we are challenging the next generation of Canadian policy thinkers, scholars, and practitioners to answer the question:

What is a high impact policy reform to improve housing affordability for renters or buyers?