HOUSING POLICY FAILS BIG CITIES
The federal Liberal government, which bills itself as the champion of the middle class, seems to have left that target market out of its national housing strategy unveiled Wednesday, National Housing Day.
While its focus on the most vulnerable is laudable, the strategy responds to affordable housing rather than housing affordability, the latter being the crisis that affects countless Canadians trying to find a place to live in Vancouver and Toronto. The measures announced this week will do nothing to improve their lot.
However, for the half-million families and individuals described as vulnerable, some relief appears to be forthcoming, although not right away. In fact, most of the money allocated to housing will not start flowing until 2020.
The plan includes a $15.9-billion fund to build 60,000 new housing units, and repair 240,00 others. More than 20,000 units will go to people with developmental disabilities, seniors and survivors of family violence. There’s $2 billion for a Canada Housing Benefit that will provide direct subsidies to 300,000 vulnerable households. Provinces and territories are expected to cough up matching funding. And there’s $2 billion more to extend an existing homelessness agreement with provinces and communities that was due to expire next year. The strategy also includes less tangible measures such as new legislation to require all future federal governments to maintain a national housing strategy, the creation of a federal housing advocate, support for Indigenous peoples and recognition of housing as a human right, which promises to keep the Canadian Human Rights Commission and the courts busy over the next decade.
For the middle class, Ottawa has made housing more unaffordable with mortgage rules that require homebuyers to pass a “stress test” to qualify for mortgage insurance showing they can finance a loan two percentage points above the Bank of Canada five-year benchmark rate, which stands at 4.99 per cent. A federal crackdown on alternative lenders lessens competition in the mortgage business, leaving fewer options for borrowers who can’t pass that test.
To be fair, the federal government is responsible for managing systemic risk and is rightly concerned about household debt. Neither does it have the policy tools, such as permitting and zoning, to develop market housing in Vancouver.
So, in Vancouver, city hall has stepped in where the federal government has feared to tread. The city has released its own 10-year plan that calls for 72,000 new homes for renters, families, and vulnerable residents over the next decade. It has also introduced an empty homes tax and imposed new restrictions on shortterm rentals in an effort to increase the housing stock, the impact of which remains to be seen. A regional foreign buyers tax on real estate in the Lower Mainland has had little effect on prices. Frankly, with a million more people forecast to come to B.C. over the next decade, trying to suppress demand might be a losing battle.
But there are other measures the city could take to add to supply. For example, all arterial roads should be considered prime locations for row or townhouses. These sorts of developments have been built along South Granville, Oak and Cambie without negative effects. More corner lots could accommodate a second house. More duplexes, triplexes and fourplexes could be built on single lots. The city could lift its ban on basement suites in duplexes and townhouses. The city could make it easier for homeowners to build laneway homes to either rent or sell. We could simply build smaller homes on smaller lots. Increasing density need not mean more highrise apartment buildings.
Vancouver’s housing strategy comes before council on Tuesday. While it may not be perfect, councillors should approve the plan, remove bureaucratic barriers that delay building and move aggressively and quickly to resolve the affordability crisis.