Want Affordability? Get Supply.
For over a year now I’ve been talking about the need for Ottawa to be building homes Up, In and Out. Our population is expected to increase by 400,000 people from 2018 to 2046 (or 40% growth from our current 1 million residents).
How are we ever going to supply enough homes to meet our population growth? By building Up, In and Out: Up – with taller buildings around transit stations and on main streets; In – with denser infill projects in existing neighbourhoods; and, Out – with new communities in Orléans, Barrhaven and Kanata.
COVID has not affected the demand for housing in Ottawa. Sales of new homes are at the same pace in 2021 as they were in 2020 and 2019. The inventory of resale homes is as limited as it has ever been.
We may see the proportion of home construction tip a little more to the suburbs this year based on the sales data showing COVID-leery buyers, but the big take away is that the demand for housing is as strong as it ever was, even without international students and with changes to the rules governing properties being used for short-term rentals like AirBNB, which was expected to add to the long-term rental stock.
Housing is a continuum, and a lack of supply in any part of housing choice has multiple impacts, and contributes to increasing house prices.
A lack of rental housing prevents people from moving into their first home. A lack of entry-level housing prevents people from moving out of rental apartments and condos (80% of available rental is people moving into a home of their own). A lack of move-up homes prevents people from freeing up the stock of entry-level homes.
And, not having an appropriate number and range of homes forces people to move out to communities beyond the City of Ottawa boundary, exacerbating a number of issues that the City is trying to address in the Official Plan.
As the people working on the supply end of the equation, new home builders recognize that finding the right home for you is a balance of housing type, location and affordability. You can compromise on the first two, but not the third. The number of homes available in a given area, the types of homes available, and their price are fundamental factors in the overall affordability of homes.
That’s why ensuring sufficient supply and having an appropriate mix of housing available to Ottawa residents is crucial to protecting affordability. The only way we’re going to be able to deliver the sheer amount of homes we need is by building Up, In and Out.