New census data reveals a continuing issue in the erosion of lower rent housing
Steve Pomeroy
Executive Advisor and Industry professor at Canadian Housing Evidence Collaborative (CHEC) McMaster University
In 2020 I published a brief seeking to make a case for the National Housing Strategy to add a funding stream to enable non-profit housing organizations to acquire existing moderate rent rental properties. That analysis highlighted the issue of the rapid erosion of such lower rent stock, and how these effectively negates efforts to increase affordable supply under the NHS.
I argued the need to encourage mechanisms and funding to support non-profit acquisition to address this loss and to slow the impact of private capital funds buying these existing affordable properties with the intent to increase rents to generate strong investment returns.
In that brief I determined that between 2011-2016 some 322,00 lower rent (below $750/month, affordable at incomes of $30,000) units were "lost". And noted that when compared to the production of new affordable housing, five units were being lost for every one new affordable unit created (at substantial subsidy cost).
The release of the shelter cost and income data from the 2021 Census now provides an opportunity to update this assessment. As expected the trend has continued, albeit at a slightly slower pace. But still substantially outpaces new affordable construction.
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Between 2016-2021 a further 230,000 low rent units were lost (an average of 46,000 per year). This represents 6% of total unsubsidized rental housing.
To date the NHS has committed funding to build just over 95,000 new homes with roughly two thirds having some level of affordability (RCFI units account for 38,000 and most are well above any reasonable definition of affordable and almost none below the $750/month used to assess the census data).?Very few have yet been completed with most in process or under construction.
So, by comparison the annual rate of loss (46,000) is more than double the number of new units being added annually (fewer than 20,000) under NHS funding.
Without a response to address this rate of erosion it will be impossible for the substantial funding under the current array of NHS initiatives to have any impact in expanding the net stock of low rent units.
Mental Health Advocate & Consultant | Leading Mental Health Initiatives
2 个月Steve, Always enjoy seeing your updates!
Trustworthy Advisor: Innovation, Business Development, Leadership
2 年There’s good data here Steve Pomeroy. This too reflects what we’ve seen. There is good news and And action coming to this soon. It’s called the EH Plan, it’s a Canadian Innovation. Equity and Housing in Waterloo (and elsewhere) can improve soon.
Founder & Principal at Trillium Housing
2 年More great analysis Steve, many thanks. It would be interesting to know what is happening to "lost" units - are they rented above the $750 threshold and to what degree higher? Maybe most continue to be low cost and have crossed over the threshold under normal rent-controled increases? Are they old and replaced with new housing stock (and is the new stock rental or ownership). I wonder if CMHC is gathering this type of useful data - I believe under the NHS they were provided massive new funding to gather better housing data. Maybe they could fund this and reduce the multy-billion-dollar dividend that they transfer to the federal government each year - mostly gathered from high insurance fees required by law and added to the housing cost of mostly modest income Cdn families.
Excellent work Steve. I agree completely.
Certified Association Executive
2 年You called it about uh, 20 years ago?