An estimated 769,000 households are living in deep poverty and at imminent risk of homelessness, pushed to the edge by rising rents, increasing food costs, and stagnating incomes. Many are living in aging, lower-cost rental housing that is increasingly vulnerable to demolition, redevelopment, renoviction, and rent increases.
These Canadians need support now. That’s why CAEH is advocating for a transformed and expanded Canada Housing Benefit, which could reduce homelessness by more than 60% within two years of implementation, as well as preventing homelessness for those 769,000 households: nearly a million Canadians.
Housing benefits can be a life raft, but only housing can stop the storm for good. Solving homelessness over the long-term means building more housing that the lowest-income Canadians can afford. That means the next national housing strategy must include a serious, sustained federal commitment to deeply affordable and supportive housing, beyond the scale outlined in Build Canada Homes, to meet the needs of Canadians.
Homelessness is a Housing Problem
New research from CAEH, inspired by the landmark 2022 U.S. Study Homelessness is a Housing Problem, shows a clear link between homelessness rates and the availability and affordability of rental units at the low end of the market in communities across Canada. That is, homelessness has increased the most in communities where the cheapest rental apartments have become less affordable, and vacancy rates have decreased. That means that while the recent national increase in rental construction has eased conditions for middle-income earners, those most at risk of homelessness are still struggling.
This crisis is the result of decades of underinvestment in social and affordable housing stock. In Canada currently less than 4% of all housing is deeply affordable social housing compared to the 7% OECD average. Reaching that average would require more than 575,000 additional social housing units. To put this in perspective, this is nearly 10 times more housing than Canada’s largest social housing provider, Toronto Community Housing Corporation, currently provides. At the same time, we are losing affordable homes faster than we’re building them. More than half of Canada’s purpose-built rental housing was constructed before 1980. Canada loses approximately 46,000 affordable rental homes each year due to rent hikes, demolitions, and conversions to other uses. That’s nearly as many units as the entire portfolio of Canada’s largest private-sector landlord, Starlight Investments (54,000).
What are Supportive and Deeply Affordable Housing?
For the vast majority of people who experience homelessness, all they want and need is a home they can afford, that meets their needs. Deeply affordable housing – often social housing – needs to be affordable for the lowest-income Canadians at 30% of their gross income: a commonly-accepted measure of affordability that leaves enough left over for food, medication, utilities, and transportation. Under the expiring National Housing Strategy, several programs designed to build more affordable housing used unrealistic definitions of affordability linked to market rents instead of income.
Some people experiencing homelessness require support to recover from mental or physical health issues or substance use. A small number require place-based support due to the complexity of their needs. Supportive housing is an approach that provides deeply affordable housing with wraparound supports, in one location or scattered-site units throughout a community in Housing First programs, greatly reducing the risk they will fall back into homelessness.
CAEH is also calling for Intensive Housing to be included in the next national housing strategy. Intensive Housing is the equivalent of long-term care for a small but growing group of Canadians experiencing homelessness who are living with severe, permanent cognitive impairment, from compounded issues such as FASD, traumatic brain injuries, and brain injury from repeat overdose. For more about Intensive Housing and our recommendations, co-developed with physician and researcher Dr. Monty Ghosh, click here.
The next national housing strategy should set targets for deeply affordable and supportive housing that are anchored in what the lowest-income Canadians can actually afford. CAEH is calling on the federal government to:
- Create 575,000 units of additional social housing to bring Canada up to the OECD average of 7% of housing stock;
- Create 30,000 to 50,000 units of supportive housing, which can include both place-based supportive housing as well as funding for Housing First scattered-site approaches, in partnership with provinces and territories;
- Create 6,000 units of Intensive Housing for people with severe, permanent brain injuries and cognitive impairment (read more here);
- Close the urban, rural, and northern Indigenous housing gap through a by-Indigenous, for-Indigenous URN housing strategy;
- Repair and maintain existing affordable housing stock, particularly the deeply affordable units at risk as federal operating agreements expire.
Building and Financing the Solutions
Canada has a long but distant history of social housing development. Through the 1970’s and 1980’s Canada was producing between 20,000 and 30,000 units of social and deeply affordable housing per year.
Canada was able to achieve this level of housing through direct federal leadership, sustained and dedicated financing through the 1973 National Housing Act (including low-interest loans), and partnerships between the federal government and provinces, non-profits, municipalities, and cooperatives.
As our history shows, federal leadership in housing is essential, but the federal government can’t do it alone. Provinces, municipal governments and the community housing sector are essential partners, not just in producing needed social and affordable housing, but also to remove the barriers that increase cost and reduce affordability of new housing, and to provide complementary social and health supports for people with complex needs. This is why a National Housing Accord is so critical to the success of the next National Housing strategy.
The massive scale of Canada’s social housing supply gap also begs the question – how are we going to pay for it all? Building 575,000 units of housing is at minimum $200 billion investment. Financing this level of investment will require new sovereign tools and partnerships that are able to provide long term financing and bring new non-government capital into housing.
This new capital must be patient sovereign capital that protects low-income renters from the return and growth demands hedge funds and market investors typically seek that drives increasing rent. The National Housing Council, an independent advisory body, made this point clearly in its second letter on the next national housing strategy. In this letter the Council shares three international social and affordable housing financing models the federal government could explore to finance social and deeply affordable housing including France’s Livret A, the USA’s Low Income Housing Tax Credit and Denmark’s use of its central bank and mortgage finance system.