This piece originally appeared in The Hamilton Spectator.
Canada’s affordability crisis isn’t a breaking news story. Housing shortages have plagued all of our country’s major cities over the past decade and, even in the grip of the pandemic in November of last year, the housing market continued to record double-digit price increases.
But what the pandemic has done is focus wider attention on the escalating severity of unaffordability. As COVID-19 impacts the labour market and people’s incomes, more and more families are experiencing job insecurity and — in turn — housing insecurity. Finding tangible solutions to finally address the housing crisis has never been more urgent.
To put our housing crisis into context, recent research shows that one in 10 Canadian households are in core housing need, meaning that their cost of housing accounts for more than 30 per cent of the household’s total income before tax. This is occurring at a time when housing demand is outpacing supply, household incomes are remaining relatively flat and housing prices are soaring.
The importance of safe and stable housing options cannot be overstated. Adequate housing provides families with the stability needed to establish roots in their communities, to maintain steady work, or to pursue education and business opportunities. It also puts them on stronger financial footing and, in the case of affordable home ownership, allows them to build equity over the long term. For some, this means that affordable housing is key to helping break the intergenerational poverty cycle.
The case for why we should tackle the housing crisis is clear, but what’s not so obvious is the solution.
To date, the spotlight has been focused firmly on federal and provincial governments to come up with the answer, but this crisis cannot — and should not — be tackled by government alone. While governments must continue to step up and keep affordable housing at the top of the agenda, we must increase collaboration between the public and private sectors to kick-start the change that is needed.
Historically, financial institutions have shied away from investing in affordable housing options because of perceived risk or unfavourable policies. However, through partnerships between the public, private and non-profit sectors, we will not only increase investment in affordable housing, but develop innovative models that expedite the delivery of new affordable housing units.
An example of this type of collaboration in action is the new partnership between Vancity Community Investment Bank (VCIB) and national housing non-profit Habitat for Humanity. For VCIB, collaboration runs in the family. Vancity Group has a long track record of financing and supporting affordable housing and creating access to affordable homes, and supporting local communities is a priority. Since 2009, Vancity Group has funded investments of more than $1.48 billion to support the development of affordable housing stock across Canada, and has also long supported Habitat for Humanity through mortgage financing and operating loans. Now, VCIB has taken this partnership one step further.
Learn more about VCIB’s impact financing in our Real Estate Financing page. If interested in chatting with VCIB about your financing needs, .