Ontario’s growing housing crisis needs urgent action, creative financial incentives to spur development

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Affordable housing quickly became a number one issue across Ontario even before federal leaders began their campaigns leading to the Sept. 20 election. The reasons are obvious:

  • Housing prices are out of reach
  • Construction costs have increased due to demand and supply chain issues — all of which are Covid-related
  • An affordable housing crisis already existed before Covid

Cary Green is a developer who specializes in affordable housing and he is working closely with Mike Yorke, president of the Carpenters District Council of Ontario, to push for more government incentives for builders to create much needed affordable units. Simply put, the status-quo is not generating enough; and Canada has some of the worst red-tape issues for builders in the world leading to huge construction delays.

A successful post-COVID economic recovery in Canada can and should be driven by the construction of more affordable housing, says Green, chairman of Greenwin, one of Canada’s largest privately owned property management companies.

However, the challenges of that construction-led bounce back, however, is finding ways to cut government red tape and inspire the private sector to jump on board.

“Affordable Housing may not be recognized for what it is: tax relief for all and a revenue generator for government coffers,” Green said. “The statistics overwhelmingly show that the more people are properly housed, the less of a burden there is on hospitals, health care and policing,” Green said.

“If you don’t have an address, or are “under-housed,” meaning that you are crowded into a home not your own, it is near-impossible to get ahead. Social mobility is only possible with proper housing.”

Ontario’s carpenters are a critical part of the recovery equation and Yorke says more construction jobs are always good for the economy (a proven force-multiplier) and the current economic crisis shortage of skilled labourers are challenges that governments at all levels must address.

“Building more affordable housing is important if we are supporting immigration, racialized communities, Indigenous Canadians, the unemployed, and the under-employed,” he said.

“Moreover, more housing stock of this kind will lessen overall housing demand and save taxpayers money in so many areas: Healthcare, policing, and increased productivity from the underhoused, the “rent-poor”, or homeless Canadians.”

Rising immigration levels create opportunities and challenges, Yorke said.

If Canada’s target of 1.2 million people arriving over the next three years is realized, then there will be increased pressure on an already extremely tight housing market.

However, there is also an opportunity to bring carpenters and other trades workers who were trained in skilled trades around the world into communities across Canada where shortages impacting infrastructure and housing construction projects.

“Bringing skilled individuals into Canada will help with the crisis . . . but the we have to do our due diligence to make sure that housing is available,” Yorke said.

Research proves that the cost to taxpayers in Ontario for even a shelter bed is up to $200 per night; whereas with expanded affordable housing, the cost to taxpayers to produce new units can be dropped to $14 per night. Green says all this can be done by using innovative construction bond financing specifically geared to the production of new affordable housing units.

For example, a bond formula would allow housing creators to borrow over a 35-year period with the builder paying back 100 per cent of the principal and the federal government paying the first 20 years of the term’s interest. The builder would then pay the remaining 15 years. The actual interest costs to the federal government would be greatly offset by the accelerated amount of affordable housing units created, which would then generate huge tax savings across the board, as well as increased jobs and productivity. (On average, $1 million spent in apartment construction generates 10 full-time construction jobs and future full-time jobs in maintenance, management and utilities).

He suggests mobilizing the private sector with this key strategic policy of the Affordable Housing Development Construction Bond, which would be non-disruptive and would work seamlessly with the Canada Mortgage and Housing Corporation, as well as regional and local housing departments and secretariats.

Yorke and Green agree that building more affordable housing is a piece of Ontario’s recovery puzzle and increasing employment for carpenters and other tradespeople, but it’s more than that.

“It’s also a step-up to increased productivity, human dignity, well-being and safety. With proper housing, all things are possible; without it, the stress on individuals and the system is immense,” Green concludes.

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