Thursday, March 23, 2023

Ontario must commit to affordable housing for all, not affordable housing

During his provincial election victory speech on June 2, Ontario Premier Doug Ford said he intends to build more housing to make the housing market more “accessible” to all.

While most people probably did not pay attention to the specific word choice that Ford used during his speech, it is worrying that Ford abandoned the word “affordable” instead of “accessible.”

Instead of using a word that speaks to the economic side of the housing crisis, she has chosen a screenwriter for a term that means feasible, realistic, manageable.

This is worrying because it suggests that Ford is actively shifting the discourse away from an already very loose concept of affordability to an area that is even less defined.

A Man In A Suit Waves From Behind A Podium
Ontario’s premier, Doug Ford, along with his wife Karla, celebrate on stage after being re-elected as Ontario’s premier.

In February, Ford presented the Housing Affordability Task Force Report, recognizing the existence of the housing crisis and the need for urgent affordable housing.

However, despite acknowledging the need for more affordable rents, the report could not explain how exactly the province would reach it. This is somewhat ironic, given the title of the task force.

In addition, the report does not address some of the issues regarding housing such as evictions, rent control and homelessness.

Deepening of housing crisis

Statistics Canada defines affordability of housing as no more than 30 percent of household income spent on housing-related expenses.

In the Greater Toronto Area and in Ontario, however, there is a big difference between the rise in house prices and household income.

The real estate market has experienced a tremendous increase. Since 2010, it has nearly tripled, both within the Greater Toronto Area (up to $ 1,254,436 from $ 431,262 in April 2022), as well as within Ontario (to $ 923,000 from $ 329,000 in 2021).

A Property Sign On The Lawn Of A House
A sale sign will be displayed in front of a house in the Riverdale area of ​​Toronto in September 2021. One of the main reasons for the housing crisis in the Greater Toronto area is the difference between rising house prices and stagnant household income.

At the same time, the average household income increased by only about a third. This difference between rising house prices and stagnant household income is the key reason for the housing crisis in Ontario, especially in the Greater Toronto area.

Housing Financing

Ford may have avoided the term affordable because the economic growth model in Canada depends on the conversion of human rights housing into a financial investment instrument – a process known as housing finance.

Since the early 2000s, Ontario has embraced this economic growth model that prioritizes property speculation and property-driven economic growth.

Housing financing has led to the creation of new housing projects for investment purposes, rather than affordability and accessibility. This economic growth model is the main reason for the housing crisis in Ontario.

A Graph Showing The Various Driving Forces Behind The Ontario Economy
Currently, real estate is the top driving sector of the Ontario economy.
(Statistics Canada), Author provided

Ford is a proponent of pro-development growth and acts as an anti-environmentalist by advocating for more urban expansion in the form of more suburban housing.

The massive suburban process in the Greater Toronto Area will be accelerated by further housing financing. Unless we force politicians to change the current economic model through policy, the housing crisis will continue to deepen.

The need for a strong housing agenda

Increasing the housing supply – the most commonly proposed scenario by all major parties to deal with the crisis, with the exception of the Green Party – will not solve the issue unless affordable housing supply is specifically increased.

While the general housing supply continues to grow, supported by policies of all three levels of government, there are no explicit policies for affordable housing in place.

Consequently, house prices continue to rise, or at least remain unaffordable, because the addition of supply does not automatically translate into a fall in house prices.

Affordability can only be achieved with an ambitious plan that invests in affordable rental housing, similar to what was done in Toronto between 1960-79, when 66 percent of all new housing was built as purpose-built rental units. Since then, there has been little investment in this housing option.

Though there are a few projects from different levels of government, this is the only way to reduce the long list of 79,572 people waiting for affordable housing in Toronto.

Therefore, all three levels of government must be called to action, stand together and develop an ambitious plan for affordable housing. We need to resist Ford’s new term of ‘affordable’ housing, thereby preventing it from abandoning the search for truly affordable housing.

Seyfi Tomar, Secretary General of the Canadian Branch of the International Real Estate Federation, co-authored this article.

Nation World News Desk
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