Worried about the future of housing in London?
Rents are skyrocketing. House prices are too high. Many Canadians aren’t sure if they’ll ever be able to afford their first home. Others will have to leave their city in search of more affordable solutions.
Housing connects us all. And not enough housing affects us all. It impacts affordability and rental prices, and hurts the most economically disadvantaged.
There is a solution: Canada needs more homes.
How a shortage of homes is driving up prices
For decades, Canada has not been building enough homes. Our population keeps growing (which is good), but the number of homes we build to house people hasn’t kept up. A shortage of housing supply combined with high demand means that the value of the homes that do exist go up in price.
The pandemic highlighted our housing shortage thanks to several factors. Many people wanted to move because their needs changed (e.g. they needed more space because they were now working from home, or they wanted to move to be closer to family). Many saved money because they couldn’t spend it on other things (like vacations), so they had more to spend on housing. And the low interest rate environment, which encouraged spending to help the economy rebound, also helped to offset those higher prices and make it mortgages more affordable. These factors combined resulted in rapidly rising home prices.
Now with interest rates rising, the flurry of activity has cooled. But that doesn’t mean that people no longer need homes, nor does it mean housing is now more affordable. House price growth has slowed, but buyers can’t afford as much due to higher interest rates. When people can’t afford to buy their first home, they stay in rental units. Then there are more people who want or need to rent than there are vacancies. And that’s when we see rental prices starting to go up.
It's all connected. We need more homes, of all types.
What your community can do to support more housing supply
Building more homes is not as easy as it may seem. There are a lot of steps to go through, each one intended to ensure that our communities grow thoughtfully and with care. And often there are barriers to getting homes built – and getting the right kind of homes built. Below is a list of common issues, and solutions.
- The process of steps to go through can get bogged down due to onerous and/or inefficient processes, plus city staffing shortages, resulting in communities not being responsive enough to the urgent need for more homes.
Solution: cities can reevaluate and streamline their processes and/or hire more people so that they’re more efficient and can keep up with the workload.
- Development fees for new communities, which often also shoulder the cost to maintain the city’s existing/aging infrastructure, can be so high that they make the cost of new homes unaffordable to the people who need to live there.
Solution: cities should make sure that new homeowners only pay for their fair share through development taxes, and not for benefits that new development brings to the surrounding existing neighbourhoods – those should be paid for by the general tax base.
- People who already own homes are vocally opposed to new developments and densification in their area that would allow others to live there (this is called NIMBYism. NIMBY = Not in My Backyard)
Solution: We all deserve a place to live. The good of a community and all its residents should be the priority. And new residents make for more vibrant communities. We need concerted efforts to move to YIMBY (Yes in My Backyard).
- There aren’t enough homes built close enough to public transit nodes, making living in the area impossible for those who don’t own cars.Solution: Prioritizing transit-oriented development is crucial, especially when building purpose-built rentals or entry-level homes. We need higher density housing near transit nodes. When people can take public transit, it helps alleviate traffic congestion for all.
These challenges continually slow down or stop the construction of much-needed housing supply in many cities across the country. To help, the federal government’s new Housing Accelerator Fund is being designed to offer support to municipalities that: grow housing supply faster than their historical average; increase densification; speed-up approval times; tackle NIMBYism and establish inclusionary zoning bylaws; and encourage public transit-oriented development.
Solution: Creating systemic change to enable more housing supply to come online faster will require municipalities to be dedicated to more supply, have support from their constituencies, and have funds to make the systemic changes. All municipalities should be applying to the Housing Accelerator Fund to make this happen.
What you can do to support more housing supply
You can help be part of the solution:
Push your local government: Get informed about how your municipal leaders are supporting housing supply. And call on your municipal leaders to take action. Ask them what they are doing to support more housing supply and ensure they are taking action to:
- Improve permitting and approval processes; ensure sufficient staffing
- Reduce development taxes
- Tackle NIMBYism
- Increase housing density near transit nodes
- Take advantage of the Housing Accelerator Fund to make this all happen
Support local housing supply efforts: Be supportive when your community grows, whether that’s increasing the density in your neighbourhood or building a new community nearby. Be part of consultations that will ensure growth inward, upward, and outward. We all deserve a place to live.