1. Why should government play a role in creating affordable housing?
2. Which level of government is responsible?
With those questions as a backdrop, here are 10 things one needs to know:
1. When it comes to affordable housing, the private sector alone doesn’t cut itâ€”not by a long shot!Â For it to be profitable for a for-profit developer to create rental housing in one of Canada’s major urban centres, for example, a large one-bedroom (or small two-bedroom) unit would have to fetch approximately $1,500/month in rent.Â Using 30-percent-of-gross-monthly-income as an affordability benchmark, a household would have to earn $60K annually to afford such a new unit.Â Admittedly, average market rent is lower than this amountâ€”but in major urban centres, it is not much lower.Â And a key advantage to presenting to students of social work is that they’re keenly aware that many households make considerably less than $60,000 annually.Â Indeed, a single (employable) adult receiving social assistance in Ontario makes a mere $7,500 annually.Â That is not a typo: see for yourself here.
2. “Social housing” typically involves a government subsidy that helps bridge the gap between what a low-income household can afford and what the private market requires.Â Â This is one of the great things about social housing in Canada; it makes otherwise unaffordable housing affordable.Â If all low-income persons lived in social housing, Canada wouldn’t have much of a housing problem. (Housing for low-income persons that involves a government subsidy can be owned by either a non-profit or a for-profit entity, and some policy wonks like to debate which of the two approaches is better.Â I did not get into this debate in class, but have previously written about it here.)
3. Only a small percentage of low-income persons in Canada live in social housing.Â Only about 5% of Canada’s total population lives in social housing (by contrast, 32% of Sweden’s population lives in social housing, while 34% of the Netherlands’ population lives in social housing).Â In the City of Ottawa, families with children typically wait three years for social housing, while single adults typically wait more than five years. (Information pertaining to waiting lists across Ontario can be downloaded here.)
4. A lack of affordable housing has important implications for other spheres of social policy.Â Research done in Toronto has looked at the role of housing when it comes to children in care.Â Results indicate that “the state of the familyâ€™s housing was a factor in one in five cases in which a child was temporarily admitted into care. Results from the Toronto research also indicate that, in one in 10 cases, housing status delayed the return home of a child from care” (Falvo, 2012, p. 14).Â Moreover, when people become homeless, they suffer serious health problems and die at a relatively young age (something else that did not surprise the social work students I was speaking to).Â Research done on Toronto’s population in 2007 found that homeless persons were 4X more likely to have cancer than members of the general population.Â And as Dr. Stephen Hwang once noted: â€œHomeless people in their forties and fifties often develop health disabilities that are more commonly seen only in people who are decades older.â€
5. From a legal standpoint, there appears to be very little that any level of government must do about all of this.Â As my colleague Marion Steele has pointed out: â€œI think it is important to make the distinction between what governments are permitted to do and what they must do. There is very little they must do, although the charter challenge [to be discussed below] is about this ideaâ€ (M. Steele, personal communication, January 14, 2015; emphasis in original).
6. Mortgage regulation is a federal responsibility.Â Federal involvement and authority to act in Canadaâ€™s mortgage market comes from two sources.Â First, with the creation of Canada Mortgage and Housing Corporation (CMHC) and the National Housing Act, the federal government was permitted to provide mortgage insurance (and set terms of eligibility for the insurance).Â Second, through the Bank Act and other financial regulation, financial institutions in Canada (including banks) are forbidden from issuing mortgages with more than an 80% loan-to-value ratio, unless the mortgage is insured.
7. Land-use planning is constitutionally defined as a responsibility of provinces and territories.Â However, all provinces and territories have enacted legislation (municipal Acts and planning acts) that effectively devolve responsibility for planning to local government, albeit subject to the provincial legislation.
8. Landlord-tenant relations are a provincial/territorial responsibility.Â According to my colleague Shibil Siddiqi, “Under the Constitution, property and civil rights are and have always been in the provincial domain. Accordingly, Ontario is responsible for regulating landlord-tenant relations and this hasn’t changed much at all over the years. Historically landlord-tenant law was seen as a subset of property law” (S. Siddiqi, personal communication, January 6, 2015).
9. Even though CMHC itself recognizes that more than 12% of Canadian households are in “core housing need,” no level of government in Canada accepts responsibility for developing the necessary new supply of affordable housing that would address this problem (and this includes housing for Aboriginal persons, whether they live ‘on reserve’ or in urban centres).Â That said, the federal government has a minister responsible for CMHC; and at the provincial/territorial level, housing is often included as part of a ministry/departmentâ€™s responsibilities.Â Most provinces (including Ontario) have signed agreements with the federal government pertaining to the administration (i.e. program oversight) of already-existing units of private non-profit and public housing.Â In Ontario, municipalities are charged with administering these agreements.Â (For more on what exactly is meant by “core housing need,” see this link.)
10. Some advocates believe that the Canadian Charter of Rights and Freedoms changes much of this.Â Many blog readers have likely heard of a recent â€˜right to housingâ€™ Charter challenge, which has been fought by Ontario legal clinics since 2010.Â The clinics argued that a failure to provide adequate housing is a breach of Canada’s and Ontario’s obligations under the Charter and under international law.” The clinics recently lost at the Ontario Court of Appeal “and are preparing to seek leave at the Supreme Court” (S. Siddiqi, personal communication, January 6, 2015).
The full slide deck for my presentation is available here.Â Frances Abele, George Fallis, Josh Gladstone, Michael Mendelson, Steve Pomeroy, Shibil Siddiqi, Marion Steele, Trudy Sutton and Greg Suttor were all helpful in the preparation of the deck.Â Any errors are mine.