April 25, 2022
Rapid densification has emerged as a favoured policy approach to fix Canada’s housing crisis. The thinking is that Canadian cities possess underutilized resource wealth in the form of single-detached housing lots. Rezoning these to permit construction of multiple units, so the argument goes, will release the potential for increased supply, which many (but not all) analysts and politicians agree is the root cause of the crisis.
An additional component to the densification argument is the belief that municipalities are at best indifferent, and at worst hostile, to the work necessary to densify. This is due in part to the alleged NIMBY (”not in my backyard”) attitude of residents in opposition who pack council meetings and influence decisions on rezoning applications.
There is also the view that municipal bureaucratic inefficiencies result in lengthy delays for building approvals and add administrative costs to new construction. Momentum is now growing to ease the building of new and different types of housing across the country. This will likely spur change, but the transition promises to be bumpy.
In its most recent budget announcement, Ottawa described the apparent inability of Canadian municipalities to deliver on densification as a systemic problem that needs to be addressed. Its solution, also announced in the budget, is the “Housing Accelerator Fund.” Although details are sketchy, the fund will reward efforts by cities that promote densification. This carrot approach contrasts with the stick brandished by provincial housing ministers such as B.C.’s David Eby, who has signalled that the province is prepared to override local authority on zoning and building approvals.
At its core, the densification movement represents a renunciation of the housing model that built post-war Canada: the single-detached suburban home. Promoters of this model included the Central (later Canada) Mortgage and Housing Corporation, which published pattern books of housing designs beginning in 1947. Canadians were advised to ensure that their new homes be protected by zoning ordinances and that they fit with the character of the neighbourhood. Readers were assured that this would insure a “good long-term investment,” which is precisely what has occurred.
The potential impact of densification policy initiatives on single-detached home ownership remains to be seen. If nothing else, these efforts may accelerate a generational pivot in housing tenure and style of the sort that writer and academic Richard Florida has said is occurring in the United States. As the rooted geography of the industrial era gives way to the flexible mobility of the post-industrial age, Mr. Florida argues the consequence is a “great housing reset.” Mr. Florida coined the term to describe a decline in the rate of homeownership in the United States this century and a concomitant rise in renting.
Although less pronounced than in the U.S., Canada also experienced a historic drop recently in the homeownership rate. The rate peaked at 69 per cent in 2011 and then fell for the first time since the early 1970s to 67.8 per cent, as reported in the 2016 Canadian census. That census also reported a continued decline in the proportion of the Canadian housing stock consisting of single-detached houses, at 53.6 per cent. For the long term, there are reasons to expect that the ownership/rental ratio in Canada will continue to shift toward rental, assuming availability of the supply of such units.
More impactful for Canada in comparison to the U.S. will be the arrival of immigrants in the near term. The ambitious target of more than 430,000 permanent residents per year for the next three years will increase demand for shelter, possibly dispersed more evenly across the country depending on federal- and provincial-settlement policies. Previous research by sociology professor Michael Haan has shown that rental is the dominant choice for new arrivals to Canada, at least in their first few years of settlement.
There are signs that Canada’s housing sector is experiencing a generational pivot away from the single-family detached home. The success of recent federal and provincial densification initiatives should accelerate this transition, but it promises to be messy and rancorous. Much depends on how quickly density is introduced and what role residents are permitted in deciding how it is to be implemented.
Pushback from those opposed to neighbourhood change, especially if it is imposed by provincial governments, is inevitable. However, other residents will be more than happy to pocket the inflated price of their re-zoned properties. Hanging in the balance are those desperate for the promised fruits of densification, especially the unhoused and under-housed. The job of managing these expectations may be just as demanding as implementing the land-use transition. In any case, it’s all about to descend on a city hall near you.
John Belec is professor emeritus of geography and the environment at University of the Fraser Valley.
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