Ontario in last place when it comes to Canada’s already low housing stock

Ontario is the worst offender among Canadian provinces when it comes to the lack of adequate housing stock, according to a new analysis from Scotiabank Economics.

ONE report published Wednesday shows that Ontario, Alberta and Manitoba are the only provinces below the national average when it comes to available housing stock per capita. Scotiabank’s analysis is based on data from 2020, the last year with complete information at hand.

To make up the difference, Ontario would have to add 650,000 new homes, Alberta would have to build 138,000 units and Manitoba would have to build 23,000 homes.

Ontario in last place when it comes to Canada's already low housing stock - image

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But as big as some of these gaps are, striving for the average in Canada is not a high bar.

Canada already ranks lowest among all G7 nations for housing stock per capita. per capita, Scotiabank reported last year, needing more than 1.8 million homes to reach the average of its peers on the international stage.

Jean-Francois Perrault, senior vice president and chief economist at Scotiabank and author of the report, wrote that the delta between Canada and other G7 nations when it comes to housing points to “the collective failure of the right size of housing in relation to our population. ”

Need to reconcile immigration with intensification

It is the growth of Canada’s population that has become so difficult to control, Perrault told Global News in an interview on Wednesday, where the pain points largely come at the municipal level.

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While the federal government has stated that it wants more immigration to strengthen Canada’s economy, the comprehensive directive encounters obstacles at the urban level, such as NIMBYism, zoning challenges and lack of available labor or materials in the construction industry.

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“There is an economic necessity to have many more Canadians, which is amazing,” he said.

“When it comes down to the small things, and people are actually confronted with the daily grind of what it means to have more Canadians from a real estate perspective, it’s a much, much more challenging situation.”

Ontario’s status as an attractive destination for immigration has made the shortage of vacant housing particularly sharp, Perrault said. On the other hand, the housing stock of Newfoundland and Labrador is the highest in Canada per capita. per capita, mainly due to a decline in population through the mid-90s.

The ongoing shortage will continue to push prices up, Perrault says.

“If we do not address this, if we do not adjust the number of homes in Canada or Ontario to the right size for the needs of the population, things will never be more affordable.”

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The housing market is growing after record numbers in 2021

The housing market is growing after record numbers in 2021

Provinces, Fed is looking for answers

There is some short-term optimism that Canada will take the housing shortage seriously, but it may be some time before the provinces are about to fill the gap.

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Conservative Party MP and shadow finance minister Pierre Poilievre moved on Wednesday to study the driving forces behind inflation in Canada at the Federal Finance Committee, with a particular focus on housing affordability. His proposal was adopted unanimously with a report to be submitted before the end of May.

The federal government has also signaled plans for a housing summit to begin investigating how to resolve the issue, even though a date for it has not been set.

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Ontario too struck a task force on affordability end of last year with the mandate to increase the supply of units for rent and ownership (Perrault notes in a revelation that the group is led by Scotiabank).

The housing start-ups, meanwhile, are gaining momentum, Perrault says, enough to make a “small dent” in the housing stock gap. But it will take years of accelerated pressure to get the country’s housing market on track to meet rising demand.

Until housing is actually built, Perrault believes there is very little politicians can do in the short term to make housing more affordable. An adjustment in interest rates, for example, will not change the reality that house prices will rise as rising immigration levels continue to drive up demand for the stock that is there, he says.

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“In the short term, it’s very difficult to see how affordability has dramatically improved over the next year or two.”

Click to play video: 'Toronto looks at garden suites to cultivate housing opportunities'

Toronto looks to garden suites to cultivate housing opportunities

Toronto looks to garden suites to cultivate housing opportunities

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