Declining Housing Supply Presents Opportunities for Equitable Population Redistribution

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Housing availability and affordability have been a growing concern in Canada for a few years, especially in the last two years. In recent times, newcomers to metropolitan cities including Toronto, Vancouver, Calgary and Montreal have faced the harsh reality of homelessness, with a limited supply of suitable homes in desired locations at affordable costs. The increasing inflation rate has further aggravated the situation and forced many to embark on inter-city migration. This adds a disheartening layer of struggle for newcomers already battling the many challenges of immigrating to and settling in a new country.

Ayinke Abolarin, a newcomer in Calgary, Alberta, puts the struggle in context. “It’s frustrating that my family has not been able to find accommodation for over three months now, and we can’t even really focus on other areas of our lives. Whenever I think we’ve found one, someone else offers the landlord more money, and we lose it. We can’t register our kids for school because we don’t have a permanent home address to determine the right school zone. We’ve spent the bulk of our settlement funds on alternative housing arrangements that are not sustainable, and we can’t even make any concrete plans for the future. The situation is really frustrating”, Ayinke laments.

Preetam Ahmed, another newcomer in Markham, also explains, “I came to Canada about eight months ago and signed a lease for six months with six months upfront rent. After six months, my landlord asked me to leave because they needed the apartment for personal use”. Preetam has since been couch hopping as she has not been able to find another apartment that does not require at least a six-month upfront rent, which she says she currently cannot afford. “I found out later that my landlord increased the rent of my former apartment and rented it to someone else, and I hear this is now a common practice. Many landlords are beginning to exploit the situation.”, she concludes.

Both Ayinke and Abolarin are actively looking for jobs outside their current cities to resolve their shelter problem.

On June 23, 2022, Canada Mortgage and Housing Corporation (CMHC) released a report that estimates the amount of housing required to reach affordability in Canada by 2030. The report shows that over 30 per cent growth in housing supply is required to meet the shelter need of Canada’s growing population. However, the growth forecast is less than 15 per cent across Canada. While this report does not provide a specific estimate for all the Canadian provinces, it shows the housing growth forecast and required growth for the big four (Ontario, British Columbia, Quebec and Alberta). Ontario’s housing supply is expected to increase by around 12 per cent in the next eight years. However, 38 per cent growth in housing supply is required to meet the housing need of the growing population in the province. This shows a supply deficit of 26 per cent. BC’s deficit is a bit better at 18 per cent, with a forecasted growth of 18 per cent and a required growth of 36 per cent. Quebec shows a deficit housing supply of 12 per cent with a predicted increase of 12 per cent and a required growth of 24 per cent. On the reverse side, Alberta is projected to have a 23 per cent growth rate in housing supply. With a required housing supply growth rate of 18 per cent, this will create a surplus supply of 5 per cent to meet the housing need of Alberta’s growing population.

The report reveals that housing supply and affordability will continue to be a problem for the foreseeable future, at least in large metropolitan centres. Perhaps the current housing supply challenge presents a unique opportunity for a more equitable population distribution across Canada. However, a more consolidated intergovernmental effort is required among the Ministry of Immigration, Ministry of Labour, and the ministry in charge of housing, both at the federal and provincial levels and in partnership with employers.

The primary population growth driver in Canada is immigration, and Canada’s immigration strategy is driven by current and projected labour shortages. However, housing shortages in cities where there are jobs will continue to drive immigrants away from these cities. Worse still, immigrants might be forced to live in unfavourable conditions that hamper their efficiency in the labour market.

Statistics show that the big four are the destinations for most immigrants because of the perceived availability of better job opportunities, multiculturalism and community support. A well-thought-out intergovernmental strategy can encourage employers to establish offices in other cities outside the big four with increased housing supply and a better distribution of job opportunities. In addition, when employers who can embrace remote work opportunities do so, the setback of job availability will stop being a significant factor in the choice of settlement location for immigrants.

Many employers across Canada are beginning to provide housing solutions such as company-owned rent-to-own housing for their employees. These are forward-thinking companies that see the problem of housing availability and affordability as a hindrance to workforce growth and have taken steps to offer solutions that keep their employees happy and engaged.

Ahmed Hussen, the federal minister of housing, diversity and inclusion, has been actively meeting with his provincial counterparts across the country in hopes of finding a solution to the looming homelessness epidemic. Whatever strategies come off these meetings cannot wholistically resolve the situation if it does not align with the immigration growth and labour strategies.

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