Housing Crisis In Canada Free Essay Sample
Canada, a name known throughout the globe for life quality, sustainability, and security. As it may seem that Canada is the land of dreams, now days it might just be the complete opposite with interest rates hitting record high, levels of homelessness being greater than ever, and housing prices the average person can no longer afford, Canada is experiencing a national housing crisis. Across Canada housing prices are rising at an alarming rate, while the housing bubble expands more and more every year leading it to be on the verge of blasting culminating in a national housing crisis. The so called “Housing Crisis” also known as Shelter Inflation had started in the early 2000’s but really took off in the 2010’s after the market crash of 2008 (Kosakowski). The 2008 market crash had started as usual, with good intentions, interest rates had hit rock bottom and lending standards were let loose so that citizens with lower credit scores could also take out big loans from the bank which in the end aggravated a housing price bubble (Singh). According to recent studies, there has been a significant decrease in affordable housing in Canada in recent years, owing to the fact that affordable rents and mortgages are difficult to obtain, inflation has risen but wages have not kept pace, and there is a high demand for housing in Canada but a low supply to meet the demand.
In the past few years Canada has experienced a national housing crisis and one of the main problem to be that affordable rents and mortgages are hard to come by. Kevin O’Toole states in an interview to CBC that, “To find an affordable apartment, I'd have to go way the hell out to Sudbury or somewhere," (Luck). As we see from O’Tooles statement that the life of the average person in Canada is getting more and more stressful due to expenses and they show no sign of coming down. Holding on to the fact that rents and mortgages are getting worse and worse every year recent studies have shown that rents and mortgages in Canada have risen over 9.8 percent in the past year causing the housing price bubble to almost burst (Hempel). The national post states that, “Over the past 20 years Canadian housing has risen around 375 percent nationwide and some hot spots such as Toronto and Vancouver have risen around a crazy 450 to 490 percent making Canada first in the world for Shelter Inflation” (Stokes).
In the past decade minimum wage has risen around 50 percent and the last change being in 2018 when Ontario changed its minimum wage from $11.60 to $14.00 (Canada). As minimum wage has risen the expenses of the average Canadian citizen has also risen in the past few years with one of the main necessities being shelter. Manish Shamnani, a mortgage associate with Regina's Dominion Lending Centers notes that, “A person with minimum wage absolutely can't afford a home unless they're willing to go for a smallest condo” (Dayal). As Canadas population increases with refugees and newcomers, most would have to start with a minimum wage job and as Shamanani states that one working minimum wage could only afford the smallest condo, the housing crisis is not only having an impact on the people but also having a great impact on Canadas economy. In Canada the average house costs around $817,000 with the salary of the average Canadian being $72,000 (Simpson). As house prices are on the rise levels of homelessness in Canada is also going up. The homeless hub states that, “Households that spend more than 30% of their income on shelter are deemed to be in core housing need. Those that spend 50% or more on shelter are in severe housing need.” (Affordable housing). Noting that 27 percent of households in Canada live in core housing needs and about 11 percent live in severe housing needs homelessness seems to be getting a greater and greater of an issue which in the end is doing no good for Canada.
At a time when home prices are already skyrocketing to record highs throughout the country, a "chronic" national housing shortage most visible in Ontario, threatens to exacerbate Canada's affordability dilemma. As Canada continues to be a home internationally for refugees across the globe Canada is experiencing a national shortage of not only affordable housing but housing in general. Royal LePage reported that, “87 per cent of the 62 markets it surveyed across the country posted double-digit price increases last year, underlining the short supply of housing inventory” (Bharti). Low supply high demand is a term you may hear from housing experts in Canada, currently we are experiencing a all time high demand of housing that we cannot supply (Bharti). Chief economist Jean-François Perrault states that, “Ontario very much stands out in this respect. For Ontario to have the same level of homes per capita as the average in other provinces, over 650,000 additional housing units would be required,” (Bharti). Knowing that Canada itself needs about 1.8 million homes to meet the average homes per capita in the rest of the G7 and that Ontario needs 650,000 houses to meet the national standard of houses per capita, Ontario is responsible for about one third of Canadas shortage of houses.
Hence, this proves that throughout Canada housing prices are rising at an alarming while the the housing bubble keeps expanding more and more culmnating in a national housing crisis. As homeless rates rise and the demand of housing gets higher and higher Canadas economy if falling more and more every day, to conclude action is needed and if the expenses of shelter keep rising and rising the life of the average citizen will get harder and harder which will end up in a much bigger problem than a housing crisis.
