Canada’s housing crisis is dire. More and more, people are sharing stories of how the high cost of living across Canada is pricing everyday Canadians out of housing.
While the housing markets in Toronto and Vancouver receive the bulk of the spotlight, small town residents are feeling the squeeze too, and landlords with multiple properties continue to jack up rental prices to “keep up” with the high interest rates set by the Bank of Canada.
It is true that interest rates are hurting people’s investments; but at what point do we acknowledge the moral implications of leveraging a volatile market against people trying to maintain access to shelter?
All investments, including property, carry inherent risk, and based on current public discourse, somewhere along the way, many people seem to have forgotten that owning an investment property should not protect you from unfavourable market conditions, such as high interest rates.
That is not to say landlords are uniquely implicated in these high interest rates. It goes without saying that many homeowners are unfortunately barely hanging onto their primary residence and will continue to face devastating hardship when it is time to renew their mortgages.
Last week, the Canadian Union of Public Employees (CUPE) said the ongoing Canadian housing crisis required “Wartime public efforts” and called on the federal government to fund new public housing units at a scale required by the national housing affordability crisis, which according to experts would mean doubling that inventory.
CUPE National Secretary-Treasurer Candace Rennick said, “Rather than viewing housing as an investment or asset class, governments need to start looking at housing for what it is: a human right, that governments have a responsibility to uphold,” adding, “Greed is what got us into this mess. Developers aren’t going to save us from this crisis affecting millions of Canadians.”
The Liberals’ National Housing Strategy has allocated just five per cent of $82 billion in funds to the Community Housing Initiative. According to CUPE, this will cover expenses related to maintaining expiring operating agreements and not be put into new housing projects.
In a press release, CUPE declared, “there will be no meaningful improvement to housing affordability as long as the Liberal government excludes the expansion of public housing as a part of the solution.”
The release pointed to the financialization of housing as the primary driver in the present crisis, and reiterated that, “public housing offers the straightest line to removing investment speculation from the housing market.”
January 2024 will mark 30 years since the federal government withdrew from making new long-term investments in public housing. In 1994, the Liberal Party opted out of new long-term investments in social housing, and stopped building social housing. Nearly three decades later, Canada’s public housing stock is now half of the average housing stock among 38 members of the Organization for Economic Co-operation and Development (OECD), with just 3.5 per cent of the country’s total housing stock in social housing.
CUPE National President Mark Hancock said, “If the Liberals’ plan to pour public money into the pockets of private developers to build market housing was working, we wouldn’t be in the situation we’re in today,” and added, “We need the federal government back in the game, building quality public housing that people can afford.”
For investors in the housing market, the lack of public and affordable housing exacerbates the crisis. With limited inventory, challenging economic factors, and 30 years of the feds turning a blind eye, investors have never felt more at home in being able to leverage their assets in the housing market and charge luxury prices for basement suite dungeons. Perhaps it is time for our federal government to step up, and serve some rapacious landlords their eviction notices.