Housing in Canada is reaching its boiling point; many are struggling, unable to pay their mortgages, and most young people can’t afford one. Housing has become a primary concern among Canadians and is poised to be a dominant issue in the upcoming federal election. No city is immune to the rapidly increasing costs of housing, including Montreal, which was long seen as a renter’s paradise.
But understanding how we ended up in this situation can be unclear and difficult to pinpoint—housing is a complex issue, and there have been successful efforts to exploit this complexity and create scapegoats.
Understanding the history of housing policy and exploring potential solutions reveals that there are multiple steps we need to take to address the crisis and underscore how far behind we are.
What is the housing crisis?
The term “housing crisis” refers to the disconnect between housing needs and housing availability, resulting in a dearth of affordable and quality shelter. However, it’s not a term without controversy.
David Wachsmuth, an associate professor in the School of Urban Planning at McGill whose research focuses on housing, notes that recent use of the term ignores some important history.
“It’s important to be clear about what we mean by the housing crisis, because you go back 20 or 30 years, and there was very clearly a huge crisis of housing affordability for people who were not on market incomes. That’s a housing crisis. It isn’t usually called that,” Wachsmuth said in an interview with The Tribune.
How did we end up here?
History of housing policy
During World War II, Canada was in desperate need of new housing. As thousands flocked to the city as war workers, and veterans returned from overseas, the federal government established the Wartime Housing Limited (WHL) crown corporation. From 1941 to 1949, nearly 50,000 housing units were built, including the iconic strawberry box home.
The WHL became the Central Mortgage and Housing Corporation (CMHC) in 1949, and continued, with varying degrees of success, to provide non-market housing.
It was with the 1973 amendments to the National Housing Act that Canada ushered in its most progressive era of housing. It discontinued its urban renewal policies and instead focused on acquiring land for public, affordable, and cooperative housing. Public housing, built both by federal agencies and third-sector non-profit companies, aimed to help both the lower- and middle-class through mixed-income developments and community-based approaches. Throughout the 1960s and ‘70s, an impressive 20-30,000 units of social housing were built each year.
In the mid-1980s, the federal government began rolling back these investments and policies in favour of market-based approaches. This transition led to a significant decrease in the construction of both market and non-market rental units. In 1993, as neoliberalism continued to underpin Canadian politics and policies, Prime Minister Jean Chrétien pulled funding for new social housing and, in 1996, decentralized the responsibility to the provinces.
“There was virtually no longer any federal funding for subsidized housing [….] Responsibility for housing is devolved to the provinces. In general, they kind of devolve it even further down to the municipalities,” Wachsmuth explained. “Now you have cities that just couldn’t possibly keep up with the funding requirements.”
During the 2000s, the effects of neoliberal housing strategies were already apparent, with cities like Vancouver facing record homelessness and a housing supply shortage. Despite this, Prime Minister Stephen Harper refused to directly involve the federal government in housing production. By retreating from the housing sector, the federal government created a patchwork system in which power is scattered, funding is non-existent, and innovation is stalled, allowing the private sector to swoop in and command the housing market.
(Over)reliance on the market
Canada’s housing strategy has always included the market to some extent, but it’s apparent that when policymakers expect the private sector to house everyone, the shortcomings are massive. It’s not an issue unique to Canada: The United States and many European countries who have similarly entrusted the market are in the same precarious position.
The market will never meet all housing needs for two reasons: One, housing is expensive, and two, the true value of housing lies in its use as a social and economic tool for the nation. Where there are no direct profits in the sale or rental of the unit, there is no incentive for the market to build.
This is what makes subsidized non-market housing so logical, according to Craig Sauvé, who has represented the Sud-Ouest as a city councillor for over a decade.
“When we can plan around our needs, it’s a good investment in the economy and helps people. It’s going to provide better mental health, stability, and better results in education. I mean, housing is a social determinant of health,” Sauvé explained. “You have to build for the common good.”
The homeownership monster
Unravelling this web of issues behind the housing crisis is difficult, in part, because we are dealing with a beast that we helped create. As Wachsmuth points out, Canadians have been sold on homeownership as the strongest means of protecting their wealth.
“There’s a kind of pretty clear preference for ownership housing in Canada. Some of that [is] exogenous, in the sense that it’s not necessarily what’s in people’s hearts, but it’s more like people responding to the incentives of the system,” Wachsmuth explained. “You just can’t borrow money at a cheaper rate than you can get for a mortgage. For most people, it’s the cheapest money they could ever get in their life.”
Any politician who is perceived as threatening those civilian investments, by calling for housing values to drop to an affordable level, is setting themselves up for an impossible campaign.
“To slowly unwind the fundamental policy fixation on keeping housing prices infinitely high, and infinitely higher is a tough problem,” he emphasized. “It would be very, very hard for any government to run on a platform of effectively dispossessing the middle class of its main source of savings.”
What are the solutions?
Addressing short-term rentals
In Canadian cities, every one-percentage-point increase in the share of short-term rentals, like Airbnbs and VRBOs, is linked to a 2.3 per cent increase in rent. Regulating this market is therefore a good place to start, according to Wachsmuth.
“Cities should crack down on short term rentals. It’s by no means the biggest cause of housing affordability problems, but it’s clearly a cause,” he said. “Within a year if they really prioritize it, any given city could return 1000s of units of rental housing to the long-term market.”
Addressing zoning limitations
On most urban land, only single-family zoning (SFZ) is allowed. SFZ limits parcels from housing anything but a single household, keeping large swathes of the city almost permanently at the lowest possible density. Typically, SFZ accounts for 70 per cent of a city’s land but only 20 per cent of its population. Montreal has historically been relatively successful in limiting SFZ, at only 45 per cent of the city’s land – a makeup that helped Montreal maintain its affordability longer than Vancouver and Toronto.
Efforts to move away from SFZ have been gaining momentum. Vancouver recently adopted a policy allowing up to six units per lot across its territory.
The new federal Housing Accelerator Fund also financially incentivizes cities to upzone areas near transit but whether that is enough is yet to be seen.
Removing parking minimums is another move that’s been gaining momentum, including in Montreal. Without such mandates, developers and cooperatives could use the space for more housing, larger units, or common spaces.
Most importantly, zoning must be malleable and allow for a variety of uses and forms without the lengthy amendment processes.
Addressing financialization
The role of large financial firms in the ownership of rental housing has increased dramatically in recent years. Wachsmuth co-authored a report on the financialization of housing in Montreal, showing that large firms owned four times more rental housing than previously thought.
“These larger financial firms are just very divorced from [...] the human element of housing,” he explained. “Areas with more financialized rental housing are where more people were struggling to pay the rent.”
Following other cities
Canada should draw inspiration from other cities and countries. For instance, Finland’s ‘housing first’ strategy has been in place since 2007, leading to a substantial reduction in homelessness. It’s a simple premise: Above all else, the first step in helping people is by providing them with secure long-term housing. It has not only been a moral victory but an economic one as well, as providing housing costs less than the Canadian way of policing and managing homelessness.
Vienna is a model city for housing, as one of the most affordable major cities in Europe, where 60 per cent of residents live in subsidized housing.
Building faster
Speed is key in the housing crisis, according to Avi Friedman, a professor of architecture at McGill, who specializes in affordable housing.
“People do not understand that if you want to build affordable housing, it takes at least four years from the moment you conceive it to the moment you give someone a key,” Friedman explained in an interview with The Tribune. “There are a variety of things that we became accustomed to, and we became very spoiled. We want to create buildings that are very complex, where every item is different. And this takes time. And time is money.”
Friedman believes that alternative production methods are one key component.
“We can move far away from the mobile home stigma,” he pointed out. “But you have so many examples of how to produce things much faster with prefabrication. It’s something that we are not doing.”
Other improvements include pre-approved housing plans to simplify and shorten the permit procedure and reduce design costs, an idea recently floated by the federal government.
Building better density
Michael Eliason, a Seattle-based architect and founder of the Larch Lab, a “think and do tank” for innovative housing practices, believes that the design of density in North America is deficient, both socially and environmentally.
“The way that we build housing now, it’s basically like these huge hotels. If you’re a family, do you want to live on a floor with 30 to 40 other units where there probably aren’t any other families,” he explained in an interview with The Tribune. “It’s just not conducive to a high quality of life.”
Changes are needed in the way we build density, to improve liveability and attractiveness. Building code reforms allowing single-staircase multi-family units are gaining steam as an alternative to the mandatory double-loaded corridor. This change would increase design flexibility and resident comfort by making it easier to build larger apartments on smaller lots, according to Conrad Speckert, a recent McGill Masters of Architecture graduate who has been advocating for the change.
“It’s a matter of design flexibility, and unit layout is the biggest impact,” Speckert said. “There’s a huge impact on how wide the building might end up being and how much light and air you’re able to get into the floor plan.”
What is not the solution?
Burning bridges
All levels of government must work together going forward to solve the housing crisis. Calling mayors incompetent will only strain cooperation and demonstrates a lack of understanding of the policy history that has brought us to this point.
Blaming immigrants
Immigrants are not to blame for the housing crisis; all levels of government, to various degrees, ignored decades of warning signs. Our population growth rate remains lower than it was in the 1950s, the difference being that we have since created a structure that prevents us from building at a high enough rate to account for our growth. Now that the issue has reached the mainstream, and people are demanding answers, politicians have begun pointing fingers at vulnerable groups simply seeking a better life.
Immigration and temporary foreign workers are key in improving the nation’s building capacity and tackling the labour shortage, without whom, meeting housing targets will be unattainable.
Ignoring structural issues
The need to be intentional and unequivocal is vital; patchwork solutions and moderate interventions will not help. Without structural change, any efforts to correct the housing crisis will be ineffective and at best, short-lived. Canada must break from the neoliberal vice grip that has held us down, binding us to a notion of “only the government we need” while ignoring “all the government we need.”
Housing should primarily be regarded as a fundamental human right, integral to social welfare. For too long, the scale has lopsided, treating housing predominantly as an asset designed solely for accumulating wealth. The asset-owning class has kept their neighbourhoods frozen in amber, preventing housing from being built and blocking newcomers.
Without changing this paradigm, the problem will only grow over time, widening the wealth gap that has impoverished and exploited Canadians for the benefit of the upper-class.
“It’s going to get even more perverted with our generation, because there will be those in our generation who inherit obscene amounts of wealth and those who don’t,” Speckert explains. “And I think that a policy environment that sets up for nepotism isn’t great.”
Canadian politicians who boast about building an equitable society must ensure coherence between their rhetoric and actions, especially in terms of policy and investment. This requires employing words like compassion and respect, and approaching issues of homelessness with a sense of humanity that recognizes the fundamental need for accessible and quality of shelter.
.png)