Housing crisis Increase in Ontario; Urged to act as it spreads to city to city.

A business group suggests that Ontario should introduce incentives to promote the creation and protection of diverse affordable housing options. The rising housing costs have significantly reduced people’s purchasing capacity and are leading to increased migration out of the province.

According to a recently published policy brief on July 5, the Ontario Chamber of Commerce emphasized the importance of constructing a well-balanced variety of housing options. This includes purpose-built rentals, the “missing middle” housing, student housing, non-profit housing, cooperative housing, and supportive housing. The brief highlights the need to address the diverse housing needs of the population.

“Housing has reached a crisis point in Ontario,” the report said. “Previously considered an urban issue, housing affordability is now impacting communities of all sizes across the province.”

The report said governments and industry are not aligned on the definition of “affordable housing,” which is generally considered to cost less than 30 per cent of household income before tax.

During an interview, Rocco Rossi, the chief executive of the Ontario Chamber of Commerce, discussed the complexity of affordability, emphasizing that it varies depending on factors such as the individual’s location, income level (including those earning six-figure salaries), and their status as a recent immigrant or student.

Rossi highlighted that different people have different interpretations of what affordability means to them, and policy initiatives should be tailored to accommodate these diverse perspectives.

The report highlights that even individuals with mid-high incomes are being priced out of the real estate market, forcing them to remain in market rental housing for extended periods. As a result, this trend contributes to low vacancy rates and a subsequent increase in rental rates.

The report also emphasizes that as Ontarians allocate a larger portion of their income towards housing expenses, their discretionary spending on other goods and services decreases. This situation has far-reaching implications for the business community and the overall economy.

Furthermore, the report underscores that these housing challenges significantly impact businesses’ ability to attract and retain talented individuals. The ongoing shortage of skilled labor is exacerbated by the record levels of net interprovincial migration outflows, partly driven by the issue of poor housing affordability.

The Ontario Chamber of Commerce has stated that the provincial government’s objective of constructing 1.5 million new homes by 2031 as a measure to alleviate the housing affordability crisis will necessitate a collaborative effort from the private, public, and non-profit sectors. The chamber emphasizes the need for an “all-hands-on-deck approach” to effectively tackle the challenges and demands associated with this ambitious housing target.