Housing booms & roofs over heads
Those looking for
signs of recovery in the Canadian economy are quick to seize on the
rebounding housing market. Having plummeted precipitously last fall and
winter, Canadian home sales have bounced back with surprising vigour -
and the glitzy Vancouver and Toronto markets are leading the way.
Canadian Real Estate Association is reporting that home sales in some
key markets are better than ever. Housing sales for August 2009 were
up 18.5 % compared to the same period last year, and the average house
price rose by 11.3 % over the same period.
But a booming housing
market does not mean that Canadians are better housed. “This recent
hike in housing prices actually widens the gap between the house-rich
and house-poor,” says Michael Shapcott, Director of Affordable Housing
and Social Innovation at the Toronto-based Wellesley Institute, a
non-profit research and policy institute.
To get comprehensive
data on Canadians living without adequate housing, one has to go back
to 2006 when census figures showed that almost 1.5 million Canadian
households were in “core housing need” – an official category that
includes people living in overcrowded or substandard housing, along
with those spending more than 30% of pre-tax income on housing.
Calculating an average of 2.9 people per household, well over 4 million
Canadians were in “core housing need” in 2006.
That figure is
likely to have increased during the current economic crisis, says
Shapcott, citing a wealth of anecdotal evidence from housing and social
agencies. “Now with speculation pushing prices to pre-crisis highs and
beyond, it gets even harder for low and mid-income Canadians,
particularly tenants, to secure adequate housing.”
Facts & figures
Canada’s rebounding housing market:
According to the Canadian Real Estate Association, 42,483 Canadian
homes changed hands in August 2009, representing an increase of 18.5 %
compared to August 2008. In contrast, the sales figure for January
2009 barely reached 16,000.Record low interest rates and renewed
consumer confidence are factors in the market recovery.
Vancouver leads the way:
The sale of existing homes in Vancouver was up 117% in August 2009,
compared to the same period in 2008. In Toronto the increase was 27 %
for the same period, and in Montreal, it was 9 %.
New housing starts:
The Canadian Housing and Mortgage Corporation (CHMC) predicts that
construction will start on about 141,900 new homes in 2009 – and
150,300 in 2010. In BC alone, the CHMC projects 16,250 new homes in
2009 and 22,000 in 2010. In 2008, 34,321new homes were built in in BC.
Core housing need:
Canadians are considered to be in “core housing need” when they live in
substandard or overcrowded housing, or if they spend 30 % or more of
their before-tax income on housing. The most recent census indicates
that 13.7% of all Canadian households in core housing need. This figure
goes up to 15.8% for BC.
Growing income gap, more housing insecurity:
According to a study by the Wellesley Institute, growing income
inequality in Canada is causing increased housing insecurity, with one
in four Canadians now living in housing insecurity.
Sources: CREA, CBC, Wellesley Institute, CHMC