It’s time to make housing affordability an election issue
On October 27, 2014, Ottawans will go to the polls to elect their municipal government leaders. Judging by what we see and hear in the media, the leading issues facing Ottawa are weekly garbage pickup and the expansion of Ottawa’s Light Rail Transit system. While these issues are important, they don’t matter much to people if they can’t afford a home.
Housing affordability is a challenge for 20% of the families in Ottawa, according to “Bridging the Gap” a just released report from the Coalition of Community Health and Resource Centres of Ottawa. The timely and engaging report on Ottawa’s community wellbeing notes that:
“One in five Ottawa families spend 30% or more of their household income on shelter related expenses, calculated by Canada Mortgage and Housing Corporation as the threshold to measure housing affordability.”
So, what’s causing Ottawa’s housing affordability problem? It’s the fact that our incomes are not keeping pace with the increase in the cost of homes. In the last 25 years, household incomes in Ottawa have increased by 97 per cent, yet the cost of new homes in Ottawa has increased by 185 per cent.
While our Councillors and Mayor may be challenged to help increase our incomes, the decisions they make do have a significant impact on the cost of homes in Ottawa. Twenty five years ago, new homebuyers paid little or no development charges on a new home. Today’s new homebuyers pay $38,000 in taxes to the City of Ottawa on a single family home. The cost of land for homebuilding in Ottawa has risen 180 per cent in the last generation.
Affordability is what makes Ottawa great
Our city’s greatness lies in the fact that Ottawa’s quality of life is affordable. Ottawa’s benefits – great neighbourhoods, safe streets, world-class events and activities and green spaces – are available to many, many people. Ottawa is not Toronto, Vancouver, New York or London, where more and more people are unable to afford the great things these cities have to offer. Ottawa is great because families and residents can afford a quality of life that few other families in the world can afford. When housing affordability means spending 30 percent of household income on housing, housing affordability is one of the keys to Ottawa’s greatness.
How to promote housing affordability in Ottawa
How do Ottawa’s soon-to-be (re)elected officials keep Ottawa affordable?
They do this by adopting a balanced approach to the cost of growth; by leading the conversation about growth and change; and, by making decisions that keep housing affordable for young families and first-time homebuyers.
a) Adopting a balanced approach to the cost of growth
For residents and families, living within our means is about making sure our expenses do not outstrip our incomes. For the City of Ottawa, it’s about ensuring that the City does not spend more money than it takes in from taxes, fees and transfers from the provincial and federal government.
For cities, living within our means is also about ensuring that we have the resources required to support growth. Candidates for elected office need to understand that new homebuyers pay for infrastructure and services required for their homes ($38,000 per single family home outside the Greenbelt) and that increasing these amounts will undermine the affordability of housing in Ottawa and the quality of life enjoyed by Ottawans. Our newly-elected officials need to understand that we have reached the point where we need to look for new funding models to support the cost of growth in Ottawa.
b) Leading the conversation about growth and change
In order to meet its growth needs, Ottawa will need to build new homes and communities in our suburbs and more homes in our existing neighbourhoods. Growth means accepting change and facilitating change. Unfortunately, the public conversation about growth and change in Ottawa is more confrontational than collaborative, more political than practical. We find ourselves in a situation where the confrontation is causing unnecessary and unforeseen delays, which are driving up the cost of growth and homes.
If our City is to grow, our elected leaders have a responsibility to help us move beyond high-stakes engagements at our community associations, town hall meetings and the City’s planning committee. Our elected leaders need to lead and find new ways to bring residents, community associations and homebuilders together to help people understand change and facilitate growth.
c) Making decisions that keep housing affordable
Houses in many Ottawa neighbourhoods are becoming unaffordable. If we want Ottawans to continue to enjoy our quality of life, we have to ensure that young families and first-time buyers can afford to buy homes in Ottawa. Our elected officials cannot continue to rely on low interest rates as the guarantor of housing affordability in Ottawa.
Decisions made by Ottawa’s Mayor and Councillors have a direct impact on the cost of homes in Ottawa. Decisions with respect to the supply of land for housing; new homebuyer taxes and permits and building permits and regulations are driving up the cost of homes for all Ottawans. Our soon-to-be elected officials need to understand and assess the impact of their decisions on housing affordability in Ottawa.