Canada’s housing crisis has reached a critical juncture. With homebuying affordability ratios jumping from 39% in 2019 to 54% in 2024, policymakers face mounting pressure to act. Yet there is a persistent commentary that continues to frame the crisis through a narrow lens: prioritizing existing homeowners’ wealth over housing accessibility for all.
A recent Globe and Mail opinion piece is one of many such commentaries exemplifying this approach, arguing that falling housing prices would devastate millions of Canadians’ retirement funds. This framing reveals a set of housing policy priorities that perpetuates a system that enriches existing property owners while deepening inequality for renters and aspiring homeowners.
The Housing-as-Investment Fallacy
The premise that housing should function as a primary investment vehicle is both economically unsound and socially destructive. Housing serves a basic human need for shelter yet treating it as a passive income generator has created a system where close to 635,000 Canadians were in core housing need in 2021—defined as spending more than 30% of their income on housing, without alternative options. This number is almost certain to rise in the 2026 census.
This investment mentality has profound societal consequences. While homeowners benefit from untaxed capital gains on their primary residences, renters face increasingly precarious conditions. Current data shows that at least 235,000 Canadians experience homelessness every year, with shelter usage increasing from 105,655 people in 2022 to 118,329 in 2023. 79% of low-income renters are concerned about paying rent, and many Canadians are one missed paycheck away from homelessness. The health and economic costs of this system are staggering. Homelessness is estimated to cost around $7.05 billion per year to the Canadian economy, including emergency services, healthcare, and criminal justice costs.
The Reality for Renters
Prioritizing homeownership and housing as investment also punishes those who can’t afford a down payment: renters. Canada’s rental market offers limited protections for tenants, who face a constellation of predatory practices, including rent price fixing, renovictions, and no-fault evictions. Without rent control in many provinces, tenants can experience relentless increases designed to match market rates, often forcing them to take on debt or work multiple jobs to afford their housing. This creates a vicious cycle where those least able to afford housing are most vulnerable to greater precarity.
The income disparity between renters and owners exacerbates these challenges. Homeowners typically earn 100% more than renters, but their housing costs are only 60% higher on average. Up to 2 in 5 renter households are spending more than 30% of their income on housing, creating a cascade of financial stress that affects health outcomes and economic productivity.
The Economic Consequences of Inaction
The current trajectory is unsustainable. Without intervention, CMHC warns that by 2035, national average rents could rise another 40% to over $1,900 per month, and in cities like Toronto and Vancouver, rents could reach $5,600 per month and $7,750 per month respectively by 2032. These projections represent not just catastrophic individual hardship but systemic economic dysfunction.
The argument that falling housing prices would create an economic crisis fails to acknowledge that the current system already generates crisis-level costs. Intra-provincial migration has risen since 2020 as people search for greater affordability, homelessness rose almost 12% between 2022 and 2023, and to top it off, incomes are rising at less than half the pace of housing costs. The costs of rising homelessness and negative health outcomes as a result of housing precarity fall on taxpayers while housing speculators capture passive income.
Policy Solutions: Beyond False Choices
The framing of housing policy as a zero-sum game between homeowner wealth and access to housing is reprehensible. Meaningful reform can improve housing security without eliminating homeowner equity. Evidence-based solutions include:
- Expanding Non-Market Housing: Non-market housing options can be as much as half of market rent, and in countries where non-market housing represents a significant portion of the market, market housing becomes cheaper to compete. Setting targets for communities to increase their non-market housing options, with clear, continuous, and guaranteed funding, could dramatically improve housing accessibility and security.
- Tenant Protection Enhancement: Establishing longer lease terms, stronger eviction protections, vacancy control measures, and rent stabilization policies would provide greater security for renters without requiring massive public expenditure.
- Zoning and Development Reform: Incentivizing provinces and municipalities to simplify zoning bylaws and allow greater densities community-wide through both financial incentives and regulatory requirements could increase housing supply across the income spectrum in the long-term.
Canada’s housing crisis stems from a policy framework that prioritizes housing as an investment over housing as a fundamental right. The false choice between financial gains for homeowners and access to housing obscures practical solutions that could improve outcomes for all Canadians.
