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Housing in our communities is expensive. As of January 2023, the average rent across all types of homes has reached $2,005. When coupled with sharply increasing inflation rates, it means that Canadians are faced with increasingly tougher economic challenges.
Yet the rise in the cost of housing specifically has been hurting Canada for much longer than the recent inflationary turn. In fact, the unsustainable rise in housing prices really began 20 years ago. This has been a crisis that has taken a long time to get here. Since the early aughts, Canadian housing prices have been rising much more rapidly than real Canadian incomes, and also much faster than the housing market in the United States.
The cause of this crisis is complicated. The obvious reason is: there is much more demand for housing than there is supply. However, the explanation for how the market reached this point, which informs what the best solution might be, is a more contentious matter. As this report from the University of Toronto’s School of Cities explains, increasing supply – building more homes! – will help somewhat in meeting the demand. Yet there ought to be attention paid to affordable housing, too. Canadian public investment in affordable housing largely stopped by the 1990s, and there’s likely no coincidence that we see the housing crisis really begin skyrocketing soon after.
The crisis impacts many communities across Canada, including where we work. This recent article from the CBC looks into how the housing crisis extends to areas even outside the major metropolises of the country. In the Kitchener, where our newest program is based, one student from Conestoga College’s Kitchener campus notes how even in the past few years she has seen rents rise sharply. “There is not enough supply for the demand that we have right now,” she said. With rental rates growing by more than 7% (faster than Toronto and other, larger cities in the area), she’s not wrong.
The past year has seen higher interest rates which have contributed to the housing market slowing down somewhat in recent months. However, the crisis is still very real. The crisis has been developing for the past two decades due to policymakers not taking the matter seriously enough. If we don’t see the proper attention paid now, we’re not going to see things getting better anytime soon.