Efforts have been made by different government levels to handle the tough situation with housing affordability and availability. But recent signs suggest things might be getting even tougher. A report from RBC mentioned that now, only about 26 people out of 100 can afford to buy a regular house, a drop from 40 out of 100 four years before. For condos, the numbers are also bad, with affordability falling from nearly 60% to 45%.

Higher interest rates and home prices are making it harder for people to buy homes. In places like Ontario and British Columbia, the situation is really bad. In Toronto, housing expenses eat up 84% of an average family’s income. In Vancouver, it’s an extreme 102%. Housing costs are considered affordable if they take up no more than 30% of someone’s income.

The Toronto Regional Real Estate Board pointed out that although home prices are still much higher than before the pandemic, the average home price is now 1.08 million, compared to 843,600 four years earlier. A report by CMHC that looked back at different studies from 2023 helps us understand the tough spots created by the housing crisis.

A study on renting showed more people are moving to big cities. They might be doing this for work, a lifestyle change, or to find more affordable places to live. This shows we need a better plan to help renters and landlords. Another study said we’ll need 3.5 million more homes than what we’re on track to build by 2030. With more people coming and a strong demand for housing, this shows how important the issue is.

The country’s population grew by over 430,000 people in the third quarter of 2023, the biggest bump since 1957, and it’s mostly because of immigration. This puts even more pressure on the need for more housing.

A lot of work needs to be done

There’s a lot more to do before we fix the housing issues. Both federal and provincial levels are making moves. The feds set up a new department combining housing and infrastructure which is smart because housing problems aren’t just about roofs over heads—it’s about having the right support systems in place too. They’re putting money—$471 million—into Toronto to make more housing happen faster and fix up public housing spots.

Provincially, they’re trying to make it easier to build rental homes by not charging their part of the tax, and they want the same tax breaks for regular homes too. They’re also thinking about a plan to make building homes in factories more of a thing.  The province is actively discussing with local government how they can pay for the infrastructure that’s necessary for building more homes. This includes looking into how new fees for developers are being introduced over five years and how to handle refunds for planning fees. Minister Paul Calandra of Municipal Affairs and Housing has said the province will help ensure cities and towns have what they need to start building. The goal is to get feedback from these discussions with various municipalities to help shape laws that would be part of the government’s new plan for increasing and then giving our communities the resources to begin construction quickly. These talks with different local governments are meant to guide potential new laws to be included in the government’s incoming plan to promote more home construction by funding essential services like water management and roadways .number of homes, focusing on critical supports like water services and roads.

Governments must work on the same Level

For us to make a difference, federal, provincial, and city governments—especially in Toronto—need to work as a team. It’s going to be tough because the Conservatives are at the helm in the province, the Liberals run the federal government, and Toronto has an NDP mayor. They don’t always see eye-to-eye, but they have to unite to fix this crisis. The homebuilding industry is also ready to pitch in however it can.

The federal government has a big part to play. They handle lots of tax stuff, taking in 39% of taxes from new homes but only give 7.1% back for city stuff like roads and parks. There’s still a pile of work to tackle some big issues.

Right now, housing rules are a bit all over the place, and builders are facing real headaches with delays and not enough basic services for new homes. Sure, there have been some good changes, and with interest rates likely going down in 2024, that’s going to help homebuyers. But we need all the government folks and the building experts to think outside the box and come together to find smart ways to sort this out.