Certain words stand in or attempt to disguise themselves or their meaning. Affordability is one of these words. We hear it a lot in terms of rental supply and new build developments. Housing is rarely affordable, as it is in high demand and currently in low supply.
Affordability is usually standing in for a less comforting appeal for government subsidies.
It’s easier to appeal to some amorphous body to “create affordability”, than it is to sell the idea of government bodies fixing this mess (even if only to ourselves.) The same governments that are running large deficits, operating the pathetic OMB, the staggeringly dysfunctional Landlord Tenant Board, and multiple existing Public Housing projects (look into the crime rates and rental delinquency rates currently!) Affordability is a buzz word that is quickly losing its sting.
Affordability with nearly everything hinges on the balance of supply meeting demand. There are numerous reasons that supply isn’t keeping up with demand in many places. They range from swelling population growth, excess approval times for developers, increasing construction costs, fewer skilled trades workers, and ballooning development fees + charges. This goes for most residential building types and these are the same reason purpose-built, rental apartments aren’t being built anymore also.
If the government wants to get serious about actually creating affordable housing, they would create mechanisms and incentives for developers to build, and build now! Alternately, we could look to the government to potentially buy previously built units and retrofit them. But how will they fund and be able to afford that?
Taxes!!! Perhaps you’ve seen the stated inflation rate as 2-3% per year but is that the whole story? Have you bought celery lately!? As another example, my property tax on a Toronto property went up 9% in 2018 and a further 10% in 2019. Surely the municipality can just continue to do that ad infinitum…
The entire thing is a mess and the clowns running the circus are driving with their eyes closed. We need to consider actually exploring a multifaceted approach with real life, pilot projects that enable us to see what works and what doesn’t; not just endless planning, debate and conjecture. Try lowering taxes, creating private sector incentives, radically overhauling the RTA and LTB, partner with the private sector to come up with the most cost-effective solutions. Or hey, try doing absolutely anything!
As for the headlines and MSM, lets dial down the blame on small landlords and foreign investment. Instead how about engaging in some intelligent, productive conversations with industry and economic experts, not just random luddites upset about their neighbour’s AirBnb suite.