A new report reveals that Canada's housing crisis is worsening, with millions of households facing 'core housing need.' Despite government initiatives, the number of households in need is projected to increase, raising concerns about the long-term effectiveness of current strategies.
Canada faces a growing housing crisis, with 2.4 million households currently experiencing 'core housing need,' a situation projected to worsen to 2.6 million by 2027. This finding comes from a new report by the Office of the Parliamentary Budget Officer, which analyzed the federal government's 10-year national housing strategy launched in 2017.
The report attributes the increasing housing need to a confluence of factors, including rising interest rates and the strain placed on the existing housing stock by elevated immigration levels. A household is classified as being in 'core housing need' if their dwelling requires major repairs, lacks sufficient bedrooms, or if the cost of rent or mortgage payments, coupled with utilities and property taxes, exceeds 30 percent of their pre-tax income. Alternatively, a household can be considered in 'core housing need' if the median cost of 'adequate suitable housing' in their local area surpasses 30 percent of their pre-tax income. This Canada-specific measure of housing need is defined by the Canada Mortgage and Housing Corp. (CMHC) and is utilized across various Statistics Canada publications.The national housing strategy aims to alleviate this housing crisis by removing 530,000 households from 'core housing need' by 2027-28. This ambitious goal is contingent on several key initiatives, including targeted rent subsidies, the preservation of community housing, and direct support for new construction and renovation projects. The report acknowledges the impact of programs like the Rapid Housing Initiative, launched since 2017, estimating that these programs will assist approximately 606,373 households by 2027, with around 78,077 being removed from 'core housing need.'Without the national housing strategy, the report projects that there would have been 51,452 more households in need in 2024. However, despite a 30 percent increase in real spending on housing affordability per person, averaging $168 per person annually, the report predicts that by 2027, there will be approximately 926,000 more households in 'core housing need' compared to 2017. This projection raises concerns about the long-term effectiveness of the current strategy, particularly in light of the uncertainty surrounding its future with an upcoming federal election. The report highlights the challenges faced by developers like PCI Developments, who have benefited from the government's low-cost loan program. The company's rental housing projects have relied on these loans, but any changes to the financing programs could jeopardize future projects. The report concludes by emphasizing the need for continued government involvement and collaboration with the private sector to address the growing housing crisis and ensure the timely delivery of much-needed housing units.
HOUSING CRISIS CANADA NATIONAL HOUSING STRATEGY CORE HOUSING NEED IMMIGRATION INTEREST RATES RENT INCREASES GOVERNMENT PROGRAMS HOUSING AFFORDABILITY
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