Experts offer ideas for solving the affordability problem in housing
We need to change our attitude and our practices when it comes to appropriately sheltering more Canadians, say the experts. Here are some of their ideas for rethinking the affordability problem.
Choose homes over investments
We have to stop treating housing as an investment and start treating it as homes, says Eric Swanson, executive director of Generation Squeeze, a research and advocacy group for adults ages 20 to 40.
But changing that attitude would mean severe pushback from homeowners, banks and mortgage companies, which are all invested in appreciating real estate values.
Gen Squeeze suggests that we shift our taxation system to rely less on income and find ways of capturing the huge gains being generated by real estate. At the same time, we have to protect homeowners from a correction, should the market fail to generate that wealth.
“The more we expect home ownership to be profitable, the more housing becomes unaffordable,” he said.
Reduce our economic dependence on real estate
Generation Squeeze’s founder, UBC professor Paul Kershaw, says real estate, rental and leasing generates about 13 per cent of Canada’s GDP. Yet, the sector accounts for less than 2 per cent of employment. That compares to the construction industry, which generates about 7 per cent of GDP and about 8 per cent of employment.
“We need to get our heads and hearts wrapped around that very dynamic and say that, going forward, we don’t want to rejuvenate our economy by organizing around an economic strategy that imagines real estate will continue to grow faster than the jobs it produces and the wages that are in the economy more generally,” he said.
“We will never solve the problem of unaffordability if we don’t say that,” said Kershaw.
Make room for everyone
We need to change our zoning to ensure everybody who wants to live in our communities can find a place and that we build out the appropriate housing forms and density to accommodate that, he said.
CMHC chair Derek Ballantyne thinks there is opportunity in Toronto to open up the “yellowbelt” — the 75 per cent of neighbourhoods zoned for singlefamily homes — to other forms of housing.
“This is not about coming down a residential street and putting in eight-storey buildings. It’s about selective intervention and it’s about allowing parts of the yellow belt to intensify,” he said.
Ballantyne said there are intelligent ways of adding more homes to those neighbourhoods that does not destroy their character. In fact, studies show they improve the quality of life, shops and services available to residents.
Because the land would come onto the market as small parcels, it would be less expensive than the cost of assembling large building sites.
“It would be a way for people to be able to afford buying into those neighbourhoods,” said Ballantyne.
Buy rather than build
Instead of trying to build our way our of homelessness and the crisis in affordable housing, which is the current government strategy, perhaps we should look at buying existing rental housing, said Ballantyne.
Buying and renovating or retrofitting buildings is expensive but costs less than building new. It also adds to supply faster. But there is no magic that will make it cheaper to operate those buildings, he said.
Acquiring inventory was used in the 1970s. The early community housing programs included a significant amount of acquisitions because it was the cheapest way to keep families housed for affordable rates, said Ballantyne, who formerly headed Toronto Community Housing Corp.
“It’s not going to be simple because you’re competing with REITs (real estate investment trusts) and other large landlords for a similar inventory. But there may well be a way to incent through tax treatment or other policies the sales of buildings for affordable housing purposes to non-profits or other organizations,” he added.
Build prototypes
Give people structure — bricks and mortar — to explore different housing configurations, including co-ownership, say real estate agent Lesli Gaynor and architect Joanne Lam.
“If options were presented in a different way,” said Gaynor, “people would co-house or co-live or combine on some level.”