There’s a paradox at the heart of today’s housing crisis that few politicians are willing to name, let alone solve: Millions of Canadians can’t afford a home and desperately want prices to go down. But millions of other Canadians do own a home and desperately want prices not to go down.
This is the pickle Canada’s new housing minister, Gregor Robertson, failed to address on his inauspicious first day on the job, when a journalist asked him, “Do you think that prices need to go down?” It was a trick question of course, or at least one loaded with subtext: which massive cohort of Canadians do you plan to screw over, the ones who own a home or the ones who don’t?
Instead of recognizing the trap, Robertson blithely answered the question he was asked. “No, I think that we need to deliver more supply, make sure the market is stable – it’s a huge part of our economy – but we need to be delivering more affordable housing.”
The only part of that answer anyone heard was the first word. “Canada’s new housing minister doesn’t think prices need to go down,” CTV trumpeted, as 100 similar headlines ricocheted around the country before the day was over.
Full disclosure: I am both a homeowner (albeit one who wishes prices would, in fact, go down), and an acquaintance of Robertson’s. I haven’t seen or spoken to him in several months, and the housing ministry did not make him or anyone else available to comment for this story.
Robertson’s opening debacle with the parliamentary press scrum struck me as a rookie move — one that might have been excusable for a rookie politician, but that’s not what Robertson is. He’s the former three-term mayor of one of Canada’s biggest cities, as Conservatives kept reminding him throughout his first week in Question Period. Expanding on the theme of Robertson’s supposed love for expensive housing, Conservatives repeatedly accused Robertson of causing Vancouver’s housing crisis during his 10-year stint as mayor, during which time home prices almost tripled.
Everyone ignored the rest of Robertson’s answer, where he talked about delivering more affordable housing, but it’s worth revisiting. How exactly does the government intend to do this? How can you introduce cheap housing at one end of the market without affecting prices throughout the rest of it? So far, the only details we have come from the mandate for Build Canada Homes (BCH), the new federal agency Robertson will be in charge of. As the name implies, BCH promises in its mandate to “get the federal government back in the business of building homes.” Through this agency, the federal government will “act as a developer to build affordable housing at scale.”
That hasn’t happened in more than 30 years. And if you ask people in the trenches of getting affordable housing built, it’s exactly what the country needs.
‘More than just housing’
Municipal councils are at the vanguard of housing, from approving changes to land use to issuing building permits, and Robertson entered local politics in 2008, a moment when the federal government had thoroughly washed its hands of the housing portfolio.
“When the minister was first elected mayor of Vancouver, the federal government was openly hostile to the idea of investing in affordable housing,” recalls Thom Armstrong, CEO of the Co-Operative Housing Federation of BC. Armstrong has been in that role since 2000, and remembers when a newly minted Mayor Robertson struck a task force on affordable housing for Vancouver.
One of the notions to come out of that task force was the idea of putting municipal land toward the housing crisis through a body known as Community Land Trust. At Robertson’s request, the city put out a call for tenders to build affordable housing on city land. “Essentially the request said, ‘Look, if we made land the city owns available to a Community Land Trust on a 99-year lease for, say, 10 dollars, what could you build?’” Armstrong said. “How quickly could you build it and how affordable would it be, now and in the long haul?”
Armstrong submitted a tender on behalf of his provincial co-op federation, and won a contract to build 358 homes in an abandoned section of Vancouver’s River District.
“That was so successful that the city then gave us seven more sites. And then two more. And now, 10 years later, we've built out 12 sites owned by the city, leased on the long term to the Community Land Trusts, including more than 1,000 deeply affordable co-op homes that will be deeply affordable forever.”
In 2021, Monica Jut moved into one of the River District co-op units that Robertson and Armstrong helped bring into being. “It’s been one of the most impactful decisions of our lives. It’s given us more than just housing; it’s given us stability, connection with the other members, and the freedom to grow,”Jut said. She moved here with her teenage daughter from Maple Ridge. “We lived in market housing, but most of those places were rentals, and when the landlords were selling, it meant that we had to find another place to live.”
Jut became a widow 10 years ago. She works for the federal government and has a stable income, but as a single mother, she was unable to afford a home in Vancouver. She pays approximately two-thirds the market rate for her two-bedroom flat, and knows she’ll never be subjected to rent hikes or forced to move again.
“The biggest benefit of being part of the Community Land Trust is definitely stability. What they do is they protect our land from speculation and ensure that our homes remain permanently affordable. That security allows us to have bigger dreams.”
In addition to making municipal land available, Vancouver – under Robertson’s leadership – became the first city in Canada to impose a speculation tax, as well as an empty homes tax, which now generates roughly $150 million each year that is put entirely toward non-market housing. “It was characterized as a punitive tax grab at the time,” Armstrong recalls, “but if you’re going to take some of the wealth generated off the real estate asset base and redistribute it to create more affordable homes, what better use for a tax could there be?”
Housing solutions
Many of the affordable-housing ideas Robertson came up with have since spread across the country.
“Cities across the country are looking at their own land as a potential way to address the housing crisis, and Gregor could see that early in the process,” said Abi Bond, who spent five years as director of Toronto’s housing secretariat after she worked with Robertson as Vancouver’s director of homelessness and affordable housing programs.
“He also understood how important it was to embed affordability into supply. When you look at what the City of Vancouver delivered, it's not just supply[ing] market rental. It also includes social housing, supportive housing, all of those types of homes as well. So he didn't forget about people who are experiencing homelessness that needed places to live.”
Near the end of Robertson’s term, he led a successful push to get provincial funding for temporary modular housing to provide shelter for unhoused city residents. With the help of provincial funding, Vancouver approved 11 modular housing projects in his final year in office, leading to the rapid construction of over 600 units.
These numbers, like the amount of co-op housing built (224 units) or approved (648 units) under Robertson’s mandate, were drowned out by the wave of price increases and homelessness that overwhelmed any positive impacts Robertson was able to achieve. As a result, Robertson’s oft-repeated claim to have built more affordable housing than any other mayor in Canada tends to ring hollow – especially in light of his ill-advised promise, early in his career, to end homelessness in Vancouver.
Bond agrees that the solutions Robertson came up with were insufficient to save Vancouver from the twin explosion of housing costs and homelessness. But she doesn’t feel that was the mayor’s fault. “It's very challenging to control the market at a municipal level, especially when many of the things affecting that market, affecting the housing crisis, are not in your control.”
Armstrong agrees and blames “the complete absence of federal and provincial partners” for the problems that overwhelmed Robertson’s best efforts to do what he could with the limited funds a mayor has to work with.
Even so, “as a result of [Robertson’s work as mayor], there is now a fledgling network of community land trusts literally all over the country – in Alberta, Ontario, and Nova Scotia – reclaiming neighbourhoods for whole communities who are dispossessed,” Armstrong said. “You don't do that without a political champion, and our political champion was Gregor Robertson.”
Millions of homes needed
Four thousand kilometers east of Vancouver, Tom Clement saw what Robertson and Armstrong were accomplishing. As CEO of the Co-Operative Housing Federation of Toronto, the largest co-op federation in Canada, Clement decided to follow suit. “We're very impressed with what's happened in Vancouver, the great work they did when Gregor Robertson was the mayor,” he said. Clement’s federation is currently collaborating with a community land trust to build a 612-unit co-op in Scarborough, the biggest of its kind to be built since the federal government stopped building co-op housing under former rime minister Jean Chretien. Like all co-ops, the Scarborough complex will provide rent at below-market rates (typically 65 per cent of market rates, though that figure varies across projects and regions).
The complex is being built through a mix of municipal land grants and federal financing. “That’s what I call the BC model,” Clement said.
When asked how he felt about Robertson ascending to federal cabinet, Clement was thrilled.
“To have such an experienced federal housing minister, it’s fantastic. You’ve got to understand the municipalities. Housing is very much a municipal-level issue, but there's no way that the municipalities can do it alone. They need a federal program, a strong federal partnership, and I think that's what he's going to bring.”
But scale remains the issue. Canada doesn’t need hundreds or thousands of new homes. It needs millions.
“One of the biggest inhibiting factors of scale is how fast and how much financing and grants you can actually access,” said Bond. “For most municipalities, that's what's controlling their ability to move quickly. Everybody has the ambition, they've got sites, they've got access to density through local zoning. But the federal government has been limited by the scope of their programs.”
That appears poised to change now with Robertson at the helm of an agency – Build Canada Homes – that expressly promises “to provide $10 billion in low-cost financing and capital to affordable home builders.” That’s on top of tens of billions more in other financing and grants, plus the federal lands that Robertson is now in a position to add to municipal community land trusts.
“He's got the prime minister's mandate to embrace a new program of supply-like construction that hasn't been seen since just after the Second World War,” says Armstrong, head of the Co-operative Housing Federation of BC. At the same time, Armstrong cautioned Robertson “is going to be inheriting a machinery, through the Canadian Mortgage and Housing Corporation and the federal bureaucracy, that hasn't been challenged to do that for quite some time. There’s a lot of muscle memory that's been lost there.”
On top of reinvigorating federal bureaucracies, Robertson now confronts the task of aligning 13 provincial and territorial governments with thousands of towns and cities. The odds are steep, and the timelines are almost guaranteed to disappoint anyone hoping for a sudden change in Canada’s housing crisis.
But after 25 years in the business of affordable housing, Armstrong is more optimistic today than he’s ever been. “We haven't had a housing minister in a long, long time, if ever, that is so ready to tackle this challenge.”
A previous version of this article misidentified Thom Armstrong, CEO of the Co-op-erative Housing Federation of BC.
Comments
Exemplary article!
Robertson can be blamed for not being the sharpest speaker when it comes to off-the-cuff opinions, and for cozying up to some key developers in his later years as mayor. But that doesn't erase his successes on housing when senior governments were AWOL on rampant foreign real estate speculation and corruption and actively protectionist of exclusionary zoning in large lot, single family detached neighbourhoods in a city that ran out if available land long ago.
Jaysus, Robertson even got kicked all over the landscape for putting a safe bike and pedestrian route through a narrow section of Point Grey Road, Vancouver's Golden Mile where people like Lulu Lemon's Chip Wilson live in their $50+ million homes. What the critics ignored was that the effort obliterated the private parking spots these uber wealthy people literally stole from the city's road allowance for their Beamers and Boxters. Robertson stole it back for much safer public access for bikes and pedestrians. If someone grabbed the public boulevard for their private parking in my modest income neighbourhood, they'd be tarred and feathered.
Local Land Trusts are key. Robertson did not create the geographical and regional land use constraints (ocean, mountains, protected watersheds, agricultural land and parks) that strangle land supply in the entire metro region, but he sure got blamed.
This was especially egregious among the broad brushstroke anti-development critics on the left who are often partially correct, but also subsumed by ideological blindness that ignores basic economic principles. Every small addition or laneway home built elevates land and real estate values to some degree, as does the undocumented tens of billions in inheritence money passed down to Gen Xers and Millennials by their Boomer parents who recognize the fact their kids cannot afford to otherwise buy a home in an affordability crisis.
This also occurred in trash pieces published in former paragons of long-form investigative journalism (like The Walrus) that actually put the housing affordability crisis specifically down to Roberson's green policies (one of their worst editorials, one that made me angry enough to cancel my subscription) and for every little bit of land development that notches up local average prices an iota or two, even reasonable upzoning from single family detached monster houses on huge lots to multi-family units on the same parcel was deemed "bad" because per floor/ land area prices went up in a city with a chronic land supply shortage.
Hello? What about efficacious land use planning that uses less land per unit and still ends up cheaper overall even when per square metre floor costs increase because the unit occupies less ground space? Housing on half lots is still 1/3 cheaper than full lots.
There are very good responses to the affordability crisis and Robertson is on record for some exceptional ideas, like land trusts that takes land supply out of private hands. The Centre for Policy Alternatives has another: non-profit public housing. Cohousing also blossomed under Robertson. And, of course, all the proven layers of Canadian public housing, like self-managed cooperatives to supportive housing for the hard-to-house.
We dodged a bullet by not electing Poilievre who couldn't give a shit about any form of public or supportive housing. The CNO does focus on climate and energy more than housing. Carney's yet to be realized built record on the climate file is looking a bit dodgy now with rhetoric on "decarbonized" oil (huh?), but so far his stated housing policies (including energy efficiency) are the strongest in decades, and his minister Robertson has some gems like land trusts and co-ops already on the ground.
Build huge amounts of supply-- specifically a critical mass of public non-profit rentals and subsidized housing units from public land banks over time -- and you've got a big counterbalance to the private market that will moderate prices.
Our politicians don't seem to understand the entire house crisis as it is being called. Affordability is certainly one aspect of the big picture, but building thousands of new homes won't solve it either. The glut of homes on the current market which has a mix of affordable and higher priced homes are not moving and new affordable homes are not moving either.
With the cost of everyday living becoming unaffordable for many people, the last thing they are looking for is a home and mortgage. In most cases, it is more expensive than renting. Home ownership needs to become more affordable, existing financing no longer works and mortgage rates need to be affordable and predicable for financial planning and end up cheaper than renting.
The problem of housing prices, and the problem of affordability, are both a result of the same thing (which isn't going to change). It's the phenomenon of commodification of residential housing. There have been thousands of new units built in Toronto. The only ones that are cheaper are the ones that are so small one person is cramped in them. But even at that, the buyers are "investment owners." They buy to rent, and rent at a rate that will provide them cash flow. So rent goes up. As the rest goes up, the forces of competition drive all rents up. And thus, the sales price also goes up.
It won't change because at virtually ever level of government, the politicians own such "investment properties." Yeah, they're legal. No one's talking about sending the owners to jail. But a law could be passed requiring disposition of the properties within a reasonable amount of time, or facing the same kind of property tax surcharge that is added to tax bills of vacant properties.
But. It won't be. Because none of those investor-owner-landlords is going to reduce their own passive income by voting for such a measure.
OTOH, with interest rates as they are, and property prices as they are, it takes two handsome incomes to qualify for a mortgage, even with a large downpayment.
On top of that, there is now a lot of resale real estate on the market ... and it doesn't move unless it goes for less than what it would have fetched at the same time last year ... which in turn is less than the year before, which in turn ...
Just check the rent and sales and real estate stats. And property taxes keep going up.