Housing affordability is a pressing issue in Canada, affecting individuals, families and communities across the country. Calgarians and many other Canadians are finding it increasingly difficult to secure stable and affordable housing. Let’s take a closer look at the issue, the reasons and the role of government.

Rising housing prices

One of the primary factors driving the housing affordability crisis in Canada is the rapid increase in home prices, particularly in major cities like Calgary, Toronto, Vancouver and Montreal. Over the past decade, these cities have experienced unprecedented growth in real estate prices, far outpacing the rate of inflation and wage growth. As a result, many Canadians are finding it difficult to afford homes in these markets, leading to a growing gap between housing prices and income levels.

Stagnant wages

Another factor contributing to the problem of housing affordability is stagnant wage growth. While property prices have been rising steadily, wages have failed to keep pace, particularly for low and middle-income earners. This disparity has made it increasingly challenging for many Canadians to save for a down payment or afford monthly mortgage payments, further exacerbating the housing crisis.

Limited affordable housing options

The country also faces a shortage of economical housing options, particularly in major cities. There is an imbalance between the demand for homes and the available supply. Many Canadians are forced to compete for a limited supply of affordable rental units, leading to high rental prices and low vacancy rates. The shortage of such housing is particularly acute for vulnerable populations, such as seniors, Indigenous peoples and low-income families, who may struggle to find suitable choices.

Government policies

Our various levels of government have a significant impact in shaping housing affordability in Canada. While governments at the federal, provincial and municipal levels have implemented a range of policies and programs to address housing affordability, many experts argue that more needs to be done.

Some critics suggest that policies such as low-interest rates and lax mortgage lending standards have contributed to the housing affordability problem by fueling demand for properties and driving up prices. In the current climate, housing affordability is top of mind for many Canadians and the subject of government budget debates.

Role of the CMHC

If you’ve ever applied for a mortgage, you may know that the Canada Mortgage and Housing Corporation (CMHC) insured mortgages when consumers make a minimum down payment on a property purchase. This responsibility has changed over the years and this crown corporation of the federal government now insures bank mortgages against default.

Additionally, the CMHC partners with other levels of government and various housing organizations with a mandate to provide affordable housing options to those in need. On an annual basis, the corporation invests about $2 billion to assist families requiring housing. While 20% of social housing is administered by this corporation, they have long-term agreements with provinces and territories to look after the remaining 80%.

As well, the CMHC serves as the country’s national housing agency in that it administers the first-time home buyer loan program and other national housing initiatives.

In closing

Addressing the housing affordability crisis in Canada is a complex issue that requires a comprehensive and coordinated response from all levels of government. By considering the root causes of the problem and implementing targeted policies and programs, the country can work towards ensuring that all Canadians have access to stable, affordable and suitable housing.