Housing crisis is now in Vancouver and Toronto

Gary Mason, the insightful Vancouver correspondent for the Globe and Mail, has an opinion piece in today’s paper about the housing crisis in his city that has important implications for Toronto. This is the core of his argument.

   “Politicians, realtors and developers have continued to insist it’s simply a lack of supply (of housing). But that’s not entirely true. The thousands of new condo units built in the past few years have not been the answer to Vancouver’s affordability issue and the mayor (Gregor Robertson) has the guts to admit it. Most of the new ones are sold at luxury rates, which don’t serve the purposes of young, first – or second – time home buyers.

Meanwhile, neighbourhoods of single-detached homes on the expensive west side, in particular, have been hollowing out of young people and people generally. (Many of the homes are held as investments by offshore buyers.) The latest census showed fewer and fewer people living there. Hundreds of properties sit vacant.

(The mayor says) “We need to stop fixating on density because that’s not what this is about,” he said. “Density for density’s sake might just give us more empty homes. What we’re talking about is people.

“Schools filled with students, neighbourhood streets filled with shoppers, parks filled with kids. A neighbourhood made of perfect $5-million homes with no children is not healthy. That’s the sign of a failing city.”

That is a remarkable thing for a mayor to admit, but it’s true. A lot of Vancouver’s neighbourhoods have lost their soul, have lost their pulse of life. There are no young adults anywhere to be seen in a lot of them. How can that be a good thing?

Consider this stat: Ten years ago, if you had a household income of $97,000, you could afford to own a townhouse on the less expensive east side of Vancouver. Today, that house-hold income would need to be $175,000.”

Admittedly the housing crisis is not as bad in Toronto. We don’t have the problem of offshore buyers leaving their houses vacant, but high prices are making housing unaffordable for young families. In the expensive areas of the city like North Toronto, Rosedale, Forest Hill and the west end around High Park are becoming neighbourhoods of affluent, middle aged people with no children. The houses are much too expensive for young couples with children unless they come from families with significant wealth.

Vancouver condos in the False Creek neighbourhood

Even in suburbs like Mississauga, Vaughan and York Region house prices are too high for couples with families. Studies in the U.S. have shown that two-thirds of the suburban houses have no children living in them. The same is likely to be the case in Canada and the more expensive the houses the less likely there will be children. The irony is that these houses were built for families.

Those who believe in classical economics say that older couples will sell their houses and move into less expensive places, but things have changed. The demand for housing remains high. At least 100,000 immigrants are settling into the GTHA every year. That helps to drive our economy, but it also drives house and condos prices upwards into the unaffordable stratosphere.

There are answers to this. In Vancouver Mayor Gregor Robertson is finding ways to stimulate affordable housing projects by selling city owned land at low cost for affordable housing. In Toronto we haven’t had a public discussion of the issue let alone practical solutions. If we don’t get moving with a realistic action plan, things are going to get miserable for many, many people. Housing is a fundamental for a good quality of life.

Where is Mayor Tory on this issue? Liberals were elected across Toronto and most of the GTHA but nothing is happing to create affordable housing for middle and low income families. If we wait five years, there will be a lost generation. Only governments have the resources to solve this problem and we must hold them responsible.

This is the link to Gary Mason’s article. It is worth reading in full.

http://www.theglobeandmail.com/opinion/vancouvers-mayor-is-ready-to-fight-for-affordable-homes/article34230858/

 

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