The following table provides core results of the supply gap by province. The report has imposed different affordability targets by province to reflect their levels of income and history.
We anticipate that Canada will need an additional 3.5 million units to restore housing affordability.
Two-thirds of the 3.5 million housing supply gap is located where housing markets are least affordable — Ontario and British Columbia
Most of the additional housing supply is required in Ontario, British Columbia and Quebec. More than half of which are required in Ontario.
We see the sharpest increases — two-thirds of the 3.5 million — are required in British Columbia and Ontario. It’s within these 2 provinces that housing markets are least affordable.
Historically affordable, Quebec’s housing market has faced significant declines in affordability over recent years.
Overall, the loss of affordability can be attributed to a housing supply not responding to demand in some of Canada’s large urban areas over the last 20 years.
Other provinces remain largely affordable for a household with the average level of disposable income. However, challenges remain for low-income households in accessing housing that is affordable across Canada.
It’s important to note that even if we do reach these targets, there would still be many low-income households that would face affordability challenges.
It’s time to create housing opportunities for everyone in Canada
Increased housing supply in the rental and homeownership market is critical to achieving affordability. This will help create opportunities for households to access housing that meets their needs.
More and diverse supply across the housing system enables households to better match with housing they want and can afford. This keeps households from stretching their budgets to bid for living spaces in limited supply and that are highly priced.
Not all new housing units need to be new construction as there are alternative approaches to increasing housing supply. For example, co-living and intergenerational families living together could increase.
Existing housing structures, industrial structures and retail spaces could also be redeveloped into multi-housing units.
Not all new housing units need to be new construction as there are alternative approaches to increasing housing supply.
There are big hurdles to overcome to meet the 2030 target
There are significant barriers to achieving this quantity of supply by 2030:
- significant delays between when a project is proposed and when it starts due to long approval processes.
- skill shortages and supply-chain challenges are pushing up costs and lengthening the time it takes to build, in the short term.
- increase in supply will put pressure on the cost of construction.
Further analysis will be required to build out our understanding of these barriers.
It’s time to think differently — drastic change is required
The scale of the challenge identified in the report is more important than the exact number of housing units required.
Canada’s approach to housing supply needs to be rethought. It needs to be done differently. There must be a drastic transformation of the housing sector — including governments — and priority given to increasing the supply of housing to meet demand.
To solve the issue of housing affordability, we need an ‘all-hands-on-deck’ approach to increasing the supply of housing to meet demand.
Partnerships and innovation are needed within all parts of the housing system to achieve 2030 goals
The federal government can’t achieve this increase in housing supply on its own.
- The National Housing Strategy is investing $72+ billion over 10 years to build stronger communities and more affordable housing through construction, research and innovation. The Strategy prioritizes those in greatest need, including seniors, Indigenous people, people experiencing or at risk of homelessness and women and children fleeing violence.
- Building on these measures and recognizing that it is becoming increasingly challenging to find an affordable place to live, Budget 2022 announced a series of investments to build more houses, help people save for their first home, and curb speculation and unfair practices that drive up housing prices.
- Putting Canada on the path to double housing construction over the next decade, the Housing Accelerator Fund aims to increase housing supply by a 100,000. This is a start, but we still face a big challenge.
Even with the current programs we have, there must be a drastic transformation of the housing sector, including government policies and processes. Canada’s approach to housing supply needs to be rethought and done differently.
To solve the issue of housing affordability, we need an ‘all-hands-on-deck’ approach to increasing the supply of housing to meet demand. For example:
- Developers must become more productive and make full use of land holdings to build more housing while governments must make regulatory systems faster and more efficient.
- Partnerships and innovation are needed in all parts of the housing system to increase housing supply. This is one of the first steps to take, but there’s so much more to be done.
- All levels of government must come together to help build the supply of affordable housing and to help this initiative succeed.
Download the report