Housing

Canada’s non-profit housing sector is structurally constrained. Well-intentioned accountability mechanisms, designed to protect public investment and ensure affordability, often have the unintended effect of limiting balance-sheet capacity, restricting access to financing and preventing asset leverage. Consequently, the non-market housing sector remains underdeveloped. In consultation with stakeholders and partners in the non-profit housing space, report authors Michelle Arnold and Savraj Syan identify three technical issue fixes that could unleash Canada's non-profit housing potential.

Growing the non-market housing sector is a national priority and building the capacity of non-profits to deliver more of it is one of the most important levers available. Unfortunately, explain Michelle Arnold and Savraj Syan, at the very moment governments are counting on non-profit housing providers to deliver more affordable housing, a set of overlooked technical barriers is preventing those same providers from leveraging their own assets—which is key to increasing their borrowing power—to do exactly that.

Canada's wealth gap appeared to narrow between 2019 and 2023 and we set out to make sense of this. SCP's Director of Policy Dan Skilleter, the lead author on our 2024 Billionaire Blindspot report, connected with sector colleagues working on wealth concentration and dug into all the best available data. What he found was that the dip was largely a mirage, driven by a pandemic housing boom that temporarily inflated the one asset ordinary Canadians hold: their home. Meanwhile, these soaring prices locked out an entire generation from building wealth altogether.

About 1.3 million homes in Canada that could be family-owned are held by investors—mostly individuals. In The Star, Matthew Mendelsohn, the Missing Middle Initiative's Mike Moffat and Jon Shell explain how a simple tax change could finance new rental construction while also freeing up homes for families to buy. The policy would temporarily allow investors to defer capital gains taxes if they reinvest proceeds into new purpose-built rentals. Many policy changes are needed to fully address the complex Canadian housing crises, and this could be one that puts Canadian capital to more productive uses.

Sabrina Maddeaux and Michael Moffatt explore how the inability to afford housing not only affects individuals but also poses systemic risks to the Canadian economy and society. They delve into the implications of economic vulnerability, the talent exodus to the U.S. and the growing disconnection among younger generations, emphasizing the urgent need for a cohesive housing policy that addresses these interconnected issues to ensure a stable and resilient future for Canada.

Canadians are more vulnerable to Trump’s economic warfare today because our housing system is in crisis and has left many Canadians without affordable places to live. Some of our own bad policy choices have put us in this position of vulnerability. We've got three housing policy ideas we want the team at Missing Middle to look into.