Tuesday, March 14, 2023

Housing starts and neighborhood character

This is Joseph.

Mike Moffatt is at it again. He looks at the growth in non-permanent residents in Canada from 2014 to 2022 and it has increased from 253,525 to 732,135. In eight years. It was pointed out that this excludes those without papers. It also excludes new permanent residents, intended to be at the 500K mark for the country as a whole (Ontario is 40% of the population). 

It is very hard to get concrete numbers, but the sort of numbers the government gives are small for this type of population growth. Between 1991 and 2021, Toronto grew from 3.9 M to 6.2M people. In 1991 a one bedroom in Toronto was $592 per month ($998 in 2021 dollars). Instead the cost grew to $1,439 for a one bedroom in Toronto in 2021 and $1,527 a year later. 

There are lots of absurd examples of preserving character (the 1940's outhouse is just too scenic) that exist but the central tension is that you cannot maintain neighborhood character everywhere and have the city expand by 60% in population in a generation and keep all of the neighborhoods the same. I mean that could be a goal, keeping things in statis, but if you are pursuing that goal there is an issue here. 

We have transitioned from 28 million Canadians in 1991 to 38 million in 2021 (36% growth), so the whole country has been robustly growing in population over this time period. But, seriously, student permits went from 139,890 to 411,985 over that 8 year period. This tells me schools are using international students to balance their books but that these measures are only going to increase housing scarcity. This answers the question of where the low end housing is going -- students compete for the same housing as low income Canadians. 

Canada is also unusual in that it is a settler nation. One issue that this really brings tot he forefront is the terrible treatment that first nations experience. From Statistics Canada:
In 2018, among Indigenous people responsible for housing decisions within their households, about 12% of off-reserve First Nations people, 10% of Inuit and 6% of Métis said that they had experienced unsheltered homelessness in the past. The corresponding proportion for non-Indigenous people was 2%.

 A shortage of housing disproportionately hurts the most vulnerable members of society and there is no question that off-reserve First Nations are extremely vulnerable. What use are land acknowledgements if we can't help these people with basic housing in a climate that drops to -30 C (a credible winter temperature in Winnipeg)?  

Compared to this is the question of neighborhood character? 

The real question is if Canada has the will to build housing to match the aggressive immigration targets that it sets. Many states in the United States, including California, have responded to the housing cost spiral and it has been a while since the least affordable housing was in the US. Back in 2017 Vancouver was less affordable than either Manhattan or San Francisco, and the situation has not improved (3 years later, Toronto crossed this threshold too). At this point, corrected for salary, not even rents are cheaper in Toronto

This is a remarkable state of affairs that one presumes must come to an end eventually, but hopefully with less human cost. 

Postscript: This twitter thread came out after I wrote this piece but highlights the issues rather well. The one piece I neglected was that the richest parts of Toronto are in population decline as the detached houses becomes less and less occupied. 

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