Visions Journal

Housing policy and the affordable-housing crisis

Marika Albert, MA*

Reprinted from the Rethinking Housing issue of Visions Journal, 2019, 14 (4), pp. 5-7

Everyone in British Columbia deserves to live in a safe, secure home. This editorial considers how we got to the housing crisis we are facing today and reflects on the impact this crisis has had—and continues to have—on communities across BC. I then provide some thoughts on policy that could really help.

One of my favourite housing researchers, David Hulchanski, often talks about how Canada provides adequately for the market aspect of housing but ignores the social aspect of housing.² His insight highlights the importance of looking at housing as a social need that is central to people's health and well-being, one that should be supported by public funds and not left to the market to provide. Relying on the market to provide housing makes it almost impossible for low-income households to participate. This means that low-income households face serious challenges in securing safe and affordable housing—which has an impact on the mental, emotional and physical health of household members.

Today's housing crisis is the culmination of policy decisions made at the federal, provincial and municipal levels, combined with broader economic trends both locally and globally. Conscious policy decisions made at critical times over the past several decades favoured the consumer market, providing housing mainly in the form of private home-ownership opportunities.

Poor policy at the root of the housing crisis

Since the mid-20th century and possibly earlier, federal and provincial governments have directed public funds to incentivize home ownership. In 1946, as part of the response to the aftermath of World War II, the Canada Mortgage and Housing Corporation began to offer home-ownership incentive programs, enabling first-time buyers to obtain a mortgage more easily than before. Subsequently, similar types of programs were refined and developed federally and provincially to continue to privilege home ownership over other forms of tenure.³ As a result, 67% of Canadian households are now homeowners, while only 32% of households are renters⁴ (although this trend has started to reverse as the possibility of home ownership becomes increasingly out of reach for many households).

From the 1970s to the early 1980s, the federal government did provide incentives to increase the supply of purpose-built rental housing, but these programs dried up in the 1980s, making it no longer attractive for developers to undertake these projects.⁵ This has also been a major contributing factor to the current housing crisis, as many communities do not have enough affordable rental-housing stock to meet the growing demand for rental housing options.⁶

In BC particularly, a number of provincial policies have had a negative impact on housing affordability. For example, in 2002, the then Liberal government amended the Residential Tenancy Act so that there were no longer limits on how much a landlord could increase the rent on a unit that had been vacated. This legislative loophole enabled landlords to increase rent at a much faster rate than before, and encouraged the practice of "renoviction", where a landlord evicts a tenant under the guise of performing major renovations, and then increases the rent once the renovations have been completed. Renovictions are particularly a problem in rental-housing markets with very low vacancy rates, as is the case in the Lower Mainland, the Sunshine Coast, and Southern Vancouver Island.⁷

At the same time, international investors increasingly began to use BC's housing market as an investment opportunity, moving capital out of their home countries and buying up real estate in southwestern British Columbia.⁸ There were few barriers in place to prevent overseas, non-resident buyers from purchasing BC real estate, and market prices increased as foreign sales increased.

Another policy that favoured the consumer market was the creation of a new type of housing: the condominium, or condo. Condos did not exist in Canada before the mid-1970s. The introduction of the condo meant that home ownership was suddenly a possibility for households that had previously been typically unable to afford a detached home. Federal, provincial and municipal government policies offered various incentive and tax-based programs to encourage the construction of condos. Because condos are typically multi-unit residential apartment buildings where the units are owned rather than rented, they generate a greater profit for developers.²

Rezoning for condominium development was often not required because many municipalities already had the appropriate zoning for multi-unit residential apartment buildings. But an unintended consequence of the creation of condo buildings was that comparatively fewer purpose-built rental buildings were built. This is still a significant contributing factor in the current housing crisis. In 1990, construction was begun on 10,315 condominium buildings but only 2,122 rental buildings across BC. In 2017, construction began on 20,136 condos but only 8,370 rental buildings.⁹

Various municipal land use policies also privileged home ownership over other forms of tenure, such as renting and cooperative housing options. The majority of neighbourhoods in Canadian cities are zoned to allow only single-detached, single-family dwellings. It is difficult, if not impossible, to establish purpose-built, multi-unit rental buildings in these neighbourhoods. To do so, developers must submit rezoning applications to the municipality. These rezoning applications often face major challenges.

The Not-In-My-Backyard effect

At the BC Non-Profit Housing Association, we often hear from members facing challenges during the rezoning processes from people who don't want multi-unit dwellings in their neighbourhood. Typically, we see such NIMBYism (that all-too-familiar Not-In-My-Backyard attitude) at its harshest when our members are attempting to build more supportive types of housing, such as housing for individuals struggling with addictions or living with mental health challenges. Neighbours of proposed supportive-housing developments often use fearmongering as a way to garner support to deny the rezoning application, which effectively stops construction. This kind of response has profound negative impacts on the health and well-being of marginalized people in our communities and prevents them from accessing stable and secure housing.

We have also heard from association members who face NIMBYism in their attempts to build housing for low-income seniors and families. The complaints from neighbours and the comments from elected officials may focus on land use issues, but the sentiment is often thinly veiled prejudice against low-income individuals and families.¹⁰

While both federal and provincial levels of governments have contributed to the development of affordable housing for lower-income households and individuals in the past few decades, for the most part these programs have been short-lived and inadequate. Starting in the early 1970s, the federal government played an important role in providing funding for social housing and cooperatives, but it withdrew this support in the early 1990s. The BC provincial government also helped fund social housing initiatives, particularly after the federal government passed on funding responsibilities to the provinces in the early 1990s, but up to this point, the programs have been insufficient to meet the growing demand for affordable rental housing.

The income/cost disparity

What I haven't mentioned yet—although I think it's becoming obvious—is the relationship between housing and income. This relationship is one of the primary reasons that we need government to intervene with incentives and funding for affordable housing. Housing prices continue to rise, and households need increasingly higher incomes to purchase housing or even rent in some communities. But for the most part, household income has not kept pace with the increase in housing costs. In metropolitan Vancouver, for instance, the average price of an apartment increased by 45% between 2006 and 2016, while the average wage in BC increased by 26.6% during the same time period.¹¹ The Canadian Rental Housing Index, which uses census data to explore the experiences of renters in communities across Canada, shows that the housing affordability crisis is expanding out from the urban areas into more suburban and rural areas.¹²

Poor housing policy, increased costs of living and inadequate wage increases have all contributed to the current affordable-housing crisis in BC. We clearly need a range of housing types, forms and tenure options to address the diverse needs of our communities.

Looking ahead

While the housing crisis seems overwhelming and inevitable, it doesn't have to be. What will be important for the future of housing is recognizing that secure, safe housing is a social need. We must pressure our elected officials to make policy decisions that focus on security of housing tenure for everyone rather than policy decisions that rely on the market to provide housing.

I am very encouraged by the investment in affordable housing that we have seen recently at the provincial level with the provincial government's implementation of the Homes BC 30-Point Plan for Housing Affordability in BC.¹³ Recent changes to the BC Residential Tenancy Act have strengthened protections for tenants against renovations and fixed-term tenancies.¹⁴ The introduction of the foreign buyers tax to curb foreign investment and cool the housing market in BC is another positive policy change. I am also optimistic about what is happening at the federal level, with the recent introduction of the National Housing Strategy.¹⁵

I hope that continued investment, specifically in the community housing sector, will ensure that affordable housing is accessible to all residents, regardless of their income and need. That kind of access is what we need to effectively address this crisis.

*The views expressed in this editorial are the views of the author and not necessarily the views of the BCNPHA.