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The federal government used to build social housing. Then it stopped. How is that going?

For many housing experts, advocates and municipal officials, the seeds of today's housing crisis were planted with a policy shift in the federal government decades ago. It got out of building social housing, leaving a deficit of non-market housing that people could afford.

Consecutive federal governments in the 1980s and 90s pulled back on funding new affordable housing

Homes under construction as seen by a drone
Whitchurch-Stouffville aerial scenic of areas under development for residential home construction. Taken on June 11, 2022. Since the federal government pulled out of building non-market housing, there's been a gap in who takes that on, say advocates. (Patrick Morrell/CBC)

Many agree we're in the middle of a national housing crisis. So how did we get here?

It depends on who you ask, but for many housing experts, affordability advocates and municipal officials, the answer lies in part with a policy shift consecutive federal governmentsjoined decades ago. A shift that some argueprovides clues on how to fixthe current housing conundrum.

Despite the prime minister's assertion earlier this month that housing isn't primarily a federal responsibility, it hasn't always been that way.

Canada had long provided subsidized housing for people who couldn't afford to pay market value:for workers and returning veterans after the Second World War, for example, and in the 1970s and early 80sas pressure mounted for Ottawa to intervene during a series of recessions.

In the early to mid-1990s, back-to-back governments of different political stripes first the Conservative government under Brian Mulroney and then Jean Chretien's Liberals began pulling back from the business of affordable housing.

Facing big deficits and with neoliberalism taking hold globally, Ottawareducedspending on housing, cutthe federal co-operative housing program (one that saw the construction of nearly 60,000 homes) and eventually pulled the plug on building any new affordable housing units altogether.

We now have a 30 year deficit in non-market housing, said Andy Yan, director of the city program at Simon Fraser University.

"We're dealing with the consequences now," saidYan. "Specific populations arestruggling for housing that is affordable,that has some kind of relationship to their income."

"We see who's paying the price on our streets in Canada."

A man looks off into the distance
Andy Yan, director of The City Program at Simon Fraser University, is pictured in Vancouver in a 2021 file photo. He says the consequences of Ottawa doing less for social housing are seen on the streets of cities today. (Maggie MacPherson/CBC)

Canada's housing crisis has been the Liberal government's priority at this week's cabinet retreat in Charlottetown, P.E.l., with the country's housing minister, Sean Fraser, even suggesting the the federal government is considering a cap on the number of international studentsto ease the pressure on the housing market.

According to the Canada Mortgage and Housing Corp. (CMHC), Canada needs to build 5.8 million new homes including twomillion rental units by 2030to tackle housing affordability.

Municipalities left to manage housing file

It's not just the federal government that's passed the buck on affordablehousing. Over a number of years in the late 90s and early 2000s, the Conservative government inOntario, under Mike Harris, passed the file tomunicipalities to manage.

"Devolving responsibility in itself is not a problem," said Murtaza Haider,professor of data science and real estate management at Toronto Metropolitan University. That is, of course, "if it is accompanied by giving more resources," he said.

A man in a suit jacket looks into the camera on a residential street
Murtaza Haider, a professor of data science and real estate management at Toronto Metropolitan University, believes governments need to look at bigger initiatives to tackle the country's housing crisis. (James Dunne/CBC)

And according toHaider, that hasn't happened.

"Responsibility for social housing ended up with local governments despite their severely constrained revenue base," he said."Municipal governments get 10 per cent of the taxes we pay. 90 per cent of our taxes go to the feds and the provinces."

In 2017, the federal government announced it was "re-engaging in affordable housing through the National Housing Strategy," and said it would invest more than $82B over 10 years to "build stronger communities and help Canadians across the country access a safe, affordable home."

"But the realization is that the demand for such housing far exceeds the supply and the subsidies and the support that the three tiers of governments are providing," said Haider.

Man sitting at his desk, holding papers
Gord Krantz was first elected to the town council in Milton, Ont., in 1965. He's been the mayor since 1980. (Submitted by Gord Krantz)

At 86, Milton Mayor Gord Krantzis familiar with changing policies and philosophies on social housing. Krantzis Canada's longest serving mayor, having been in the seatsince 1980. He was a town councillor for 15 years before that.

"Downloading usually will start at the top," he said. "The federal government is the top of the food chain. They downloaded on the province and then the province downloads on municipalities. We're the end of the food chain."

But all levels of government need to come together to tackle the housing crisis, said Krantz."It's come to a peak now. We're all going to have to get our act together to address this looming problem," he said.

It comes down to money. The Region of Halton which Milton is a part of needs more money for affordable housing, said Krantz.

"The federal and provincial governments, with their taxing abilities, they can make it work," he said."Could they maybe cut back in an area or two and put an extra billion or two into social housing? I think they have the ability to do that."

CBC contacted the office of the housing minister, who referred questions to the CMHC. It didn't respond by deadline.

This past week, the housing crisis dominated the political agenda; from taking centre stage at the Liberal cabinet retreat, to being the focus of new Conservative ads. What's the role of the federal government when it comes to housing, and how does this all fit into new housing ideas coming out of municipalities, such as garden suites and multiplexes? Andy Yan, director of the City Program at Simon Fraser University and the Globe and Mail's architecture critic Alex Bozikovic join Rebecca Zandbergen to discuss.

Can the private sector pick up the pieces?

In the absence of government leadership, it's clear who has taken charge, says Leilani Farha, global director with the human rights organization, The Shift.

"When [Ottawa]retreated from thehousing market, they allowedthe private sector to invade the space and come in a very unregulated way," said Farha, who is also the formerUN Special Rapporteur on the Right to Housing.

As result, Canada nowhas an unruly and very powerful private realestate sector, said Farha. "They're used to being on a gravy train andreceiving preferentialtax treatmentwithout having to provide any social housing."

For Farha, the answer to easing Canada's housing crisis is two-fold: better regulate theprivate sector so developers are compelled to include affordable housing in their portfolios and governments need to pony up more money for socialhousing projects.

Simply flooding the market with new market value units isn't the answer, she said.

A woman looks into the camera
Leilani Farha is the global director of The Shift, an international human rights organization and is the former UN special rapporteur on the right to housing. (Idil Mussa/CBC)

"Traditional supply-demand economics do not apply anymore in the housing sector," she said."Institutional investors with so much money and ability to finance are speculating with housing."

"It's skewed the whole market."

Farha believes federal governments in the 90s made a grave mistake when they abandoned the social housing file, but the bigger mistake was losing the vision.

"Housing is for households and not speculative investment," she said. "Changing that vision was a colossal mistake."

With files from Andrea Hoang

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