Housing Revisited: Report of the Ontario Housing Affordability Task Force, Part One

A couple weeks ago the Ontario government released The Report of the Housing Affordability Task Force. As the chair of the task force, Jake Lawrence, described in the cover letter; the mandate it followed was to come up with practical solutions to the housing crisis:

Jake Lawrence

When striking the Housing Affordability Task Force, you and Premier Ford were clear: you wanted actionable, concrete solutions to help Ontarians and there was no time to waste. You asked us to be bold and gave us the freedom and independence to develop our recommendations.

This bears emphasis because when I talk about housing issues with my friends and neighbours---all of whom already own their own homes---I hear a lot of airy-fairy suggestions that I think wouldn't go anywhere. These include:

• ending money-laundering (that's the federal government's jurisdiction and something of a game of whack-a-mole anyway)
• stopping the rise in population (that's a great idea---except that both these people and myself are usually also in favour of allowing more immigration---like the Ukrainian refugees already on their way here)
• having the federal and provincial government drive dump truck loads of money into Guelph to build more social housing (good luck with that!)
• Make the rich pay!!!!! (except the rich usually seem to be very good---for one reason or another---at not paying)
• stop allowing people to change apartments into Air BNBs (that wouldn't have much effect except in tourist zones---and enforcement would be a huge pain)
• raising interest rates (that would cause problems for the entire economy)
• financial subsidies for first-time home buyers, like writing-off mortgage payments on your income tax (the US does this, and it doesn't help anyone because the savings just go into pushing up housing prices even higher)
• reform the bureaucracy to speed up the approval process for new housing
  

Here's a video clip from a TVO show where a past governor of the Bank of Canada---and member of the Housing Affordability Task Force---Stephen Poloz, explains what he thinks is really behind the high cost of housing in Ontario. 

It appears that he puts most of the blame on local government. This is the same thing that I've heard time and time again from other experts---municipal councils give far too much power to small groups of local citizens to block developers from building new housing.

If something happens in one community, it might make sense to blame the municipal government. But if it happens all over North America and much of the world beyond, I'd say that there is a bigger issue at play. So if I'm going to blame Guelph's Council for anything, it's a timidity that has kept it from thinking "outside of the box". But as someone who always thinks this way---and was profoundly unsuccessful as a politician---I suspect that the real problem comes down to a few things that are common almost everywhere:

• most people don't vote in municipal elections
• the few who do overwhelmingly already own their own homes
• conversely, people who don't own a place----even if they would like to some day, usually don't vote
• similarly, people who live in a neighbourhood and want to keep it the same will show up at Council meetings---and those who might eventually buy some new housing in that area won't
• retirees (like me) generally have more time to be involved in these sorts of things---and they also tend to the most adverse to change
  

What this means is that there is a conflict of interest in our democratic system that discriminates against potential new home owners plus a system that results in almost no one advocating on their behalf.

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This particular article has been an especial slog for me. Probably because I feel that advocating for people who are suffering from the high price of real estate is such a thankless task, I've found wading through these complex issues really hard to do, even though none of this is new to me. That's just to say that even though I am interested in the subject, a lot of writing these articles is plain hard work. If you think that it's worthwhile and you can afford it, why not support it with a subscription? Patreon and PayPal make it easy to do.
 

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The best way to understand the report's recommendations is to break them down into several different operational categories:

• accurately assess the needs and options for creating housing
  
• re-order the priorities of city council
• take away some key powers from municipalities and give them to the province
• change rules that have gotten in the way of building affordable housing 
• create regulations and penalties that will force municipalities to "get with the program"
• cut the "red tape" that strangles new development
  

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First off, the report points out that in the past both the province and municipalities have badly under-estimated the rising demand for housing. The shortfall has been identified as coming mostly from increased permanent and temporary immigration from both outside of the country and from other provinces. (I discussed this in a previous article.)  

Secondly, most discussions about development have been around the preservation of farmland and water recharge areas. (Doug Ford famously promised the development community that if elected, he'd unravel the Green Belt legislation brought in by previous Liberal governments.) The Task Force side-steps this issue by suggesting that there is already plenty of room to build new housing in low-density suburbs.
 

The recommendations of the task force aimed at these specific parts of the problem are:

• commit to building 1.5 million new homes in ten years
• "Amend the Planning Act, Provincial Policy
  Statement, and Growth Plans to set “growth in the
  full spectrum of housing supply” and “intensification
  within existing built-up areas” of municipalities as
  the most important residential housing priorities in
  the mandate and purpose."
  

I've quoted number "2" in full because it raises an important point. If you look at the current official plan of Guelph, you will see the following statement of goals for the document:

The Official Plan:
a) Establishes a vision, guiding principles, strategic goals, objectives and policies to manage future land use patterns that have a positive effect on the social, economic, cultural and natural environment of the city.
b) Promotes long-term community sustainability and embodies policies and actions that aim to simultaneously achieve social well-being, economic vitality, cultural conservation and enhancement, environmental integrity and energy sustainability.
c) Promotes the public interest in the future development of the city and provides a comprehensive land use policy basis which will be implemented through the Zoning By-law and other land use controls.
d) Guides decision making and community building to the year 2031

As you can see, nowhere in the above statement is there a direct statement that it is a goal of the city to provide adequate housing for all the citizens. 

There's a saying in science to the effect that you can't understand something until you measure it. Well, a somewhat similar thing could be said about governance: if you don't mention it directly, it won't be a priority. Guelph has never made growth in the housing supply or increasing the density of housing into priorities, which means that it has always been "traded off" for other considerations that are specifically mentioned in planning documents. Actually putting these two considerations into our planning documents and also defining them as the top priorities of planning---even ahead of things like creating enough parks, protecting heritage architecture, or, preserving a neighbourhood's "traditional character"---would go a long way to really dealing with the current housing crisis.

The report also makes the case that there already is lots of land to build housing on in Ontario municipalities---it's just been locked-up through exclusionary zoning that restricts it to only single, fully-detached housing. As a result, the population density in our cities is far, far less than that seen in other major cities of the world. Take a look at the following graphic that I've copied from the document.

I've mentioned this issue in previous posts on this subject. But it really does need to be hammered home because almost all of the people I meet simply refuse to admit that this is a real problem. So here's a short explanation of the "yellow belt" in Toronto and where all the land the Task Force says could be used to build the housing needed to end the current crisis.

 

The Task Force is focusing on the issue of building housing stock to lower the cost of living. But there is another side to this issue that also should be mentioned. Low density housing is tremendously expensive for cities to service. In fact, most experts would suggest that in most cases it can only exist because older, higher-density neighbourhoods subsidize them. Here's an excellent video from the YouTube channel Not Just Bikes that explains this issue while talking about a variety of cities---including Guelph.

 

Please note that while the creator of this video is lauding Guelph for building enough higher density housing to keep the city from bankrupting itself, this doesn't mean that it is building enough to keep all it's citizens housed. These are two different issues. Guelph may have enough higher density housing to successfully subsidize its huge swathes of low-density housing, but if we had much more, we might also be able to supply affordable housing to most of the people who want to live here. People have a bias towards thinking in either/or dichotomies---but the universe usually works with percentages. 

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OK, then. How does the Affordability Task Force think that cities like Guelph can increase the density of its housing? 

 

One phrase that they use a fair amount is "as of right". That's a fancy, legal way of saying that they are resetting the "default" of planning. What is now a special case that you have to argue in front of Council or appeal to the Planning Appeal Tribunal (what used to be called the OMB), would be assumed OK "from the get go". The Ontario Housing Affordability Task Force Report identifies a series of different planning decisions that should be considered standard operating procedures across the province from now on:

• building a fourplex of up to four stories on any given single lot
• converting commercial properties to housing
• allowing things like "granny flats" 
• allowing multi-tenant housing (ie: no laws against renting rooms)
• allowing 6 to 11 story buildings with no minimum parking requirement on any existing transit corridor 
• support municipalities to ensure that any greenfield development---both within and outside of existing municipal boundaries---to ensure that it adheres to the same density requirements identified in this report
  

In effect, the Task Force realizes that municipal politics has made increasing a city's density into a "kiss of death". Since it is political suicide to advocate for it, no one on Council wants to support it anywhere. The solution proposed simply takes away the power to veto development that would raise density from the hands of local government. With the power diffused over the entire province, the hope is that no provincial government will be afraid of a local backlash against building more housing in any particular neighbourhood.
 
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Another issue that stands in the way of building more housing are a variety of building code and other rules that have refused to "keep up" with the latest technology and social trends. What they do is artificially inflate the cost of building housing without actually improving the safety or value of the home. 

 

To understand this point, consider the following housing requirements that the Task Force suggests should be changed to allow:

• a single set of stairs in an apartment building
• wooden multi-story apartment buildings
• housing without dedicated parking spaces

The first recommendation deals with a section of the building code that mandates that apartments must have a two separate, closed-off sets of stairs on opposite sides of the building. The reasoning has been that by doing so, the individual units are protected from air intake that would feed a fire, and, give occupants a second option if one of the stairwells is impassable because of the fire.

The problem with this law is that the second set of stairs are an added expense. 

 

Enclosing and separating the stairs from the aisles also removes the potential to use natural ventilation and lighting for the corridors outside of apartments. Take a look at a European apartment stairwell. (Single stairwells are the standard in Europe.) If you add a skylight and cupola on the top of the central stairwell, then light will stream down, and, hot air can exit the top. If tenants open the doors of their apartments (or a vent at the top of their doors) then hot air will get drawn out of their unit and cooler air will come in through open windows (because of the "chimney effect")---increasing ventilation and reducing air conditioning costs.

A Paris apartment building stairwell. Image c/o The Urbanist.

While it's true that the two stairs code was designed to save lives, modern construction techniques (no more hollow plaster and lathe walls, fire resistant solid flooring, etc) plus requirements for mandatory smoke detectors and sprinklers have pretty much removed any reason for this old rule---at least for mid-sized and smaller apartment buildings.

   

A second recommendation is to allow builders across the province the option of building small apartment buildings with modern wooden construction methods instead of forcing them to exclusively use reinforced concrete. I did a quick non-scientific survey of statements wood versus concrete construction, and noticed what seemed to be a great deal of motivated reasoning that seemed to based on which side of the industry was paying the bills. (Could this be why it's taken so long to reform the building code?)

 

After winnowing through the chaff, it seems to me that the key issues to understand are that a new technology has emerged using something called "mass timber" construction for small apartment buildings. This uses "cross-laminated timber" to replace slabs and beams of reinforced concrete or steel.

Cross-laminated timber floor slab being lowered onto beams made from the same material. Image c/o Think Wood.

As you can see from the above picture, the slabs of wood are much bigger and thicker than the two-by-fours most people see in single family homes. This makes them much more resistant to fire.
 

As near as I can tell, the wood itself is not cheaper than either steel or reinforced concrete. What it is, however, is lighter---which helps cut construction costs. It also seems to be easier to work with, which means that labour costs and speed of build are better. This is where wood cuts costs. Moreover, as a renewable resource, mass timber construction is less carbon intensive than traditional methods.

 

There are already quite a few examples of successful mass timber constructed buildings, such as the 2016 T3 (Timber, Technology, Transit) building in Minneapolis below. It's a seven story office building and was constructed over just 2.5 months and used half the construction labour of a comparable reinforced steel building.  

 

The T3 building in Minneapolis. Image c/o Think Wood.

Finally, as I pointed out in a past article, using the numbers provided by an expert in the field---Donald Shoup---plus Guelph's then current parking regulations, underground parking in apartments and condominiums adds something like $75,000 to the cost of each housing unit. If developers were able to stop automatically adding expensive parking to a building---whether it is needed by tenants or not---it could result in real savings for both home buyers and renters. 

 

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Finally, in any attempt to deal with an existing problem it's important to not only change the rules, but to also provide for enforcement. There are lots of examples where governments brought in really good rules to deal with a substantive issue but they were simply ignored and this dramatically reduced their effectiveness. (If you want to check out one example, take a look at this depressing story I wrote about solid waste.) The housing emergency is too important to the well-being of this nation to come up with a good-sounding strategy that just gets sabotaged in implementation.  

 

To that end, there are a series of recommendations from the Task Force aimed at ensuring minimal sabotage to government programs based on it's recommendations:

• if a municipality hasn't raised density levels to provincial minimums within 2 years, the province will allow unlimited height and density next to major transit stations (think about the proposed tower on Wyndham St. across from  the Guelph police station)

If Guelph didn't have it's act together vis-a-vis density, it would be forced to accept this building by the province. Image c/o Skyscraper Page.

• force municipalities to change their zoning and plans to ensure the following:

• preserving the character of a neighbourhood would no longer be a priority
• remove site plan approval and public consultation from any development proposal that conforms to the official plan and has 10 or less units
• create province-wide standards with regard to things like lot size, building depth, landscaping, etc---including reducing or eliminating minimum parking requirements
• remove all floor plate restrictions on towers to allow for the creation of more efficient high-density housing
  

• stop municipalities from having more public meetings on a project beyond those required under the provincial Planning Act 
• force municipalities to allow digital participation in public consultation
• force municipalities to delegate decision-making vis-a-vis site plan approvals and minor variances to staff
• prohibit municipalities from making bulk listing on city heritage homes listings and retroactively declaring a home as being "heritage" after a development listing has been filed. In addition, any home owner who has had their property designated as being preserved for historical reasons should be compensated at the fair market rate for loss of revenue.
• restore the right of developers to appeal municipal plans and Municipal Comprehensive Reviews 

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This pig of an article is already longer than most of my readers will probably like, so I'm going to take a pause here. In part two I'll deal with more Task Force recommendations---the ones aimed at stream-lining the bureaucracy to let housing get proposed and build without years of studies and consultation. I'll also add my own thoughts about what this all means and what I'm going to be looking for this year in both municipal and provincial elections. 

Until then, cross your fingers and hope that the pandemic is finally winding down. If you can, help support the Ukraine war effort any way you think best. Be nice to each other, we've been going through "interesting times"---and they are never fun. 

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Furthermore I say unto you, the Climate Emergency must be dealt with!

 

Housing Revisited, Part Two: the Housing Crisis---Branch and Root

Four years ago I started a five-part series about housing affordability in Guelph with an article about the rental housing situation. It was pretty popular with readers, so I have been tempted to come back to the problem. But while I've seen evidence that the "powers that be" have become more aware of the issue (it was an issue in the last federal election), I've yet to see much evidence of anyone wanting to deal with the underlying causes---which I tried to document in those articles. But last week the Ontario provincial government finally published a paper that does seem to "get it". Because of that, I've done some rummaging through various other reports and thought I'd do a few posts about it as a way of refreshing my readers about what is really at the root of our present crisis before I talk about this new report.

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Henry David Thoreau, c/o Wiki Media

To quote Henry David Thoreau:

There are a thousand hacking at the branches of evil to one who is striking at the root.

As I see it, I have heard a lot about the branches, leaves, and, stem of our housing crisis from the news, politicians, and, my friends. These would be things like:

• landlords converting units to Air BNB
• offshore investors using real estate as a safe place to park capital
  
• greedy landlords that charge whatever they can get away with
  
• crime bosses laundering ill-gotten gains
• real estate speculators "flipping" houses
• real estate agents that use "blind bidding" to start bidding wars
  

I have no doubt at all that all of the above have some impact on housing costs, but to my way of thinking these aren't causes of high housing prices, they are instead symptoms. As such they are the leaves, branches, and, stem of our housing crisis---but not the roots of it.

If there was a glut of housing in Canada, landlords would have to compete for good tenants---which means they wouldn't rent out units as "party Air BNB"s because that would drive away other hard-to-replace tenants. Nor would offshore investors or the mob be buying housing, because it wouldn't be such a safe investment. Moreover, house flipping wouldn't make any sense because speculators wouldn't be able to count on properties always increasing in value. Finally, with a lot of houses on the market and buyers looking for a deal---instead of just anything they can afford---no one would deal with Real Estate agents who tried to start bidding wars.

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The above are just distractions. The real problem with housing is really simple: there just isn't enough of it being built to service the demand. If there were, then prices wouldn't be exploding all over the country.

I have talked to several city Councillors about this and the answer I get from them was that there's nothing they can do. They all said the only solution would be if the Federal and Provincial governments would shower cities with money to build more social housing. 

Pardon my cynical ears, but I don't believe that's true. I got my first whiff of this when I interviewed a provincial cabinet minister who said that cities could build a lot more housing, but they don't want to because most municipal voters don't want intensification in their neighbourhoods. And, most city Councillors don't want to alienate voters, because they fear that they won't get re-elected. As a result, they refuse to allow developers to build higher density housing in existing suburban sprawl. Excuses get thrown around, but the fact is that if the voters don't want an apartment building in their neighbourhood, politicians won't force them to take it. Since most of the land in our cities---including Guelph---is full of single family, fully-detached homes, this means nowhere near enough housing has been built for decades.  

The result of this endemic political cowardice has been the creation of what are called "yellow belts" (does the colour refer to the cowardice of municipal politicians?) in cities all over North America. If you've never heard of this, take a look at this nifty video from TVO.

 

The Yellow Belt is important to understand. Unfortunately, most people haven't  because they are deep in denial about an issue that was first articulated in my youth: the limits to growth. 

It's a simple idea, really. The human population keeps growing but the earth does not. Of course Canada has a lot of land, but as we all know, most of it is rock, swamp, and, tundra. That means when we do find good land to grow food, it is a really good idea that we don't pave it over to build subdivisions. That's why we have The Green Belt and The Places to Grow Act to limit sprawl. 

Under these two guiding pieces of legislation, the job of Ontario city Councils was clear: they needed to encourage intensification of housing to deal with population increases. Unfortunately, most elected officials and voters responded to this legislation by having a temper tantrum every time someone suggested that they should actually allow an apartment building in an existing subdivision. This meant that the only places any developer could build tended to be in a small number of sacrifice zones (like downtown or along Gordon St. in Guelph), where they would build towers. Even there, developers found so much opposition that they never could build big enough to have the economies of scale necessary to actually push down the price of individual units. 

Developers weren't allowed to build enough housing to actually approach demand, which means that they only build for the well-off who can afford to pay big prices. (After all, if you are only allowed to make and sell ten watches, what are you going to produce, Timex or Rolex?) This leaves lots of demand on the table, which resulted in existing run-down homes being bought and fixed-up by people (like me) who couldn't afford a ridiculously over-priced condo (even if it comes with a granite countertop and stainless steel fridge). This refusal to fix bad zoning resulted not only in no new housing being built for working and middle-class people---it also resulted in old, run-down, cheaper rental housing being taken off the market too. (This is called "gentrification".) That left the poor with fewer and fewer housing options. Gentrification means that the only option left for the poor is the social housing that the province and feds are supposed to provide, but chronically under-fund. (Which is probably why I've had Councillors believe more money from the feds is the only "viable solution" to the housing crisis.)

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I'm really annoyed about the way our society has created this stupid housing mess. If you agree---and you can afford it---why not subscribe? You won't hear this sort of analysis from the mainstream press and if people of good will won't support "alternative" voices, they won't get heard. Patreon and Paypal make it easy to support with small monthly payments.

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When I'm given the time to argue the above case to friends, I often get the response that they don't want Guelph to get any bigger, so why doesn't Council just stop people from moving here? I generally see this as an evasion, simply because I hope that everyone realizes that Council lacks the authority to set up armed check points to keep people out. But it is important to deal with this issue in some detail because the Home Builder's Association has identified this as an important reason why housing has become so expensive. 

Escalating prices always have two causes, supply and demand. The decision of city Councils all over North America to cut supply through idiotic planning has been made much worse because of the dramatic increase in demand that came about because of immigration to Southern Ontario. A report published in 2021 by the Smart Prosperity Institute and titled Baby Needs a New Home: Projecting Ontario's Growing Number of Families and Their Housing Needs points out that

Ontario’s population grew by nearly one million people in the five years between July 1, 2016, and June 30, 2021, after growing by just over 600,000 persons in the previous five years. This dramatically increased the demand for housing, while the rate at which new homes were built stayed virtually unchanged. This increased demand, from young Ontarians that have started to, or would like to start, a family with no change in supply, contributed to rising home prices and a shortage of family-friendly housing across Southern Ontario before the pandemic.

We estimate that 413,753 households should have been formed, but only 349,039 new housing units, of all types, were built over those five years. This difference, of 64,714 households, can be thought of as the supply gap of housing over the period. 

Page iii of Baby Needs a New Home

The impact of population growth came home to me personally last summer. For reasons I won't go into, it appears that in the next few years I am going to have to sell my present home and purchase a new one. Looking at the cost of housing in Guelph, it seems clear  to me that I cannot afford as nice a place as I presently have---let alone one a little bit bigger. (My wife is now living with me and we both agree a little more room would be nice.)

With the above in mind, last summer we were looking at communities in Ontario where we could afford to live. We had a couple design criteria in mind---namely we want some place where we can live without a car, so public transit and a Via Rail station are mandatory. What we found that seemed to be within our means were Windsor, Brockville, and, Cornwall. 

I suspected that the reason why these cities/towns seemed relatively affordable was because they are too far from Toronto to commute and are not doing too well economically---so most people don't want move there. I had these ideas confirmed by Baby Needs a New Home because it gives a population break-down for just about every community in Ontario. Here're the stats from Baby plus the most recent census data from 2021. (I couldn't find 2021 data for Brockville, so I left it out.)

• City:  Population by 2001: & 2021: Percentage of change
  
• Cornwall:   47,462 & 47,845 increase of .8%
• Windsor: 218,222 & 229,660 increase of 5%
• Guelph: 110,819 & 143,740 increase of 30%

(Gee, I wonder why housing prices have gone berzerk in Guelph?)

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This raises the question of just exactly who are these people who want to move here? Look at the following bar graph. 

From Baby Needs A New Home, by the Smart Prosperity Institute

As you can see, there has been a substantial acceleration in Ontario's population growth starting in 2016. The blue parts of the graph could show internal factors---births and people moving here from other provinces. There is an increase, but not huge. There also seems to be a similarly small increase in immigration, as the orange parts of the bar. What really stands out, however, are the beige parts that are described as "non-permanent residents".

The report suggests that most of these people are foreign students who have been allowed to stay a bit longer in Canada to continue work because of some relatively new legislation. These people also need places to live, so they too are competing with other people for living space. 

Baby Needs a New Home  identifies the Post-Graduation Work Permit Program (PGWPP) as the main culprit behind the increase in demand. (I'm not entirely sure if this makes sense, but since this is peripheral to the issue of this article, I'll just take it at face value.) In a nutshell, it is a program that allows students who are taking full time study at a Canadian educational institution the option of working after graduation in order to gain in-Canada experience while they are applying to get a work permit in Canada. 

Let's give a hypothetical example. Someone from another country gets into a Canadian graduate program in engineering. This is good news for universities, because he gets money from a corporation that wants him to research something for them---and the university gets bucks from the grant to fund their labs. While working here, this guy decides that he likes the place, so he applies to immigrate or at least work here for a while. Unfortunately, it's hard for immigrants looking for a job to get credit for experience outside of Canada, though. So this program allows people who've already applied for residency, and who've just graduated from a Canadian school, to work immediately after graduation so they can get Canadian work experience. This means that no one will "make strange" at their credentials and work experience and companies can get the really skilled, top-notch employees they need to be successful.

The federal government considers this a "win" for the country, because the Canadian economy benefits from the skilled workers it can poach from other nations. The only problem is, however, that this new slug of immigrants need to have housing, and the province and municipalities didn't take this influx of new people into account when planning new housing developments. As a result, they've dramatically under-estimated the growth in need---when they were already failing to provide enough for the existing sources of growth. The result is "another fine mess" that we have gotten ourselves into!

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Speaking of "fine messes", as I was writing today, I heard that the Prime Minister is going to invoke the Emergency Measures legislation. This effectively puts the nation under martial law and allows him to order whatever he needs to do to end this pandemic of blockades and occupations. From what I can see, it needs to be done. I have to admit that I'm more than a little freaked-out by the level of support that these anti-vaxx yahoos are getting. But it does seem to me that the vast majority of Canadians are against them, and will support our elected officials if they have to get tough. 

Maybe when the dust clears and we have a better idea of what is really going on, I'll write an article on the subject. Until then, try not to get too upset about what is going on. I recommend a good comedy---.

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Moreover I say unto you, the Climate Emergency must be dealt with!

Housing Revisited: Part One, Do We Need Citizen Barracks/Dorms?

I'm in the middle of another "deep dig" about housing, but I thought I'd toss out an idea that my significant other has mentioned several times and which I think has a great deal of merit. My wife (Misha) is a veteran who served in the First Gulf War as a member of an activated National Guard unit from Missouri. Like me, she is a firm supporter of the idea of a Guaranteed Annual Income. But she takes the idea one step further and suggests that we should also have "Guaranteed Personal Housing" (GPH). 

As she describes it, it would be like the barracks she lived in after getting out of Basic Training. This is an important distinction, because most people's vision of barracks life comes from old WWII movies---which was something like what she experienced in basic training. 

Public Domain image of Australian Air Force barracks in Edmonton Alberta during WWII. (Think British Commonwealth Air Training Plan, BCATP.)

Once you move beyond that into the modern day, things start looking an awful lot like the dorm room I had in my second semester at the U. of Guelph. Here's a picture of a modern US Air Force/Navy dorm\. 

From a page by the Wiley|Wilson architectural firm.

The salient features are that the housing is basic, some has shared bedrooms and some doesn't (again like a university dorm). The expectation is that most eating happens in a mess hall/cafeteria. Beyond that, there are shared facilities---eg a tv lounge and a computer pool. Probably most importantly, there is a regular inspection to ensure that a minimum standard of cleanliness is maintained and there no damage done to the structure. This happened at the U. of Guelph too, only it consisted of house-keeping coming in to vacuum once a week. (There were some residences where this didn't happen. But from my days working in the campus carpentry shop I can attest that sometimes the messes we found after move-out were colossal---truck loads of beer bottles, holes cut through walls---which just shows how important regular inspections can be.)

Misha's idea is that something like this should be available from the government whenever the wheels fall off your life and you find yourself with no place to live. Please note, this isn't supposed to replace things like group homes, rent-geared to income housing, etc. That's because there are a lot of people who simply wouldn't fit into this sort of thing. Sad to say, some folks need "minders" to keep them from destroying any housing they find themselves. This can be because they have psychological issues, substance abuse problems, etc. Also, it shouldn't be seen as appropriate for people with families or many types of disabilities.  

What it would be good for would be young people who are having a problem "launching" after leaving school and simply cannot live with their parents. It could also be useful for singles or couples without children who've hit "rock bottom" after after a bankruptcy, job loss, divorce, etc. It would also be valuable for people who simply need some time to 'find themselves' when they want to move into another part of their life---entrepreneurs, artists, people going through minor life crises, etc.

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My major concern about the need for something like this is because if the government were to extend our current Guaranteed Annual Income systems to the people older than eighteen and younger than 65, I'm afraid that it wouldn't help anyone because all the increased income would be siphoned off by landlords who would just ratchet-up rents in lockstep. 

I suppose it shouldn't be necessary to point this out, but the current cost of housing in Guelph is loopy and seems to be totally disconnected from people's ability to pay. I get regular real estate reports sent to me from Bullpen Consulting and the latest one, Nov 2021, had the following information:

Guelph finished ninth on the list of 35 cities for average monthly rent in October for a one-bedroom home at $1,766 and for average monthly rent for a two-bedroom at $2,115. 

Year over year, average rent in Guelph in October was up 11.3 per cent for a one-bedroom and 10.2 per cent for a two-bedroom. Month over month, average rent in Guelph in October was up 3.5 per cent and up 5.3 per cent for a two-bedroom.

With rents this high and rising so fast, it's obvious that a key part of what is impoverishing people is the outrageous cost of housing. And the only way to get the cost of housing down and still ensure an adequate supply is to build new housing. As I see it, one relatively cheap way of doing this is to create barracks or dorm-style housing for that fraction of the population which is single or couples without children who would find this sort of low-cost housing an improvement over their present situation. 

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I suppose some readers might take issue with this suggestion, but if so, I'd like you to think about it this way. A great many people are already living in rooming houses or shared accommodation. The problem is that with the average two-bedroom apartment going for $2,115 this means that each person has to pony up over $1000/month. And if someone is working at a minimum wage job of $15/hour, for forty hours a week, with four weeks in a month, that gives them only $2400 before taxes. That means that whatever else someone has to pay for---car, cell phone, food, dental, utilities, etc---leaves precious little for someone to build up the savings needed to get out of the "poverty trap".

The benefit of the citizen barracks idea is that they are a type of housing that the government could build for a lot less than the sorts of social housing it is already creating---and which is pretty much not available to most singles and childless couples anyway because the demand has so wildly out-stripped the supply.

There's also a multiplier effect. One of the advantages of a Guaranteed Annual Income (GAI) is that it eliminates the "reserve army of labour" that keeps wages low and allows employers to abuse employees. The idea is that if companies can always find someone who is so desperate for money that they will work for them, they can pay as little as possible and treat employees like dirt because there will always be someone to replace them. This is why wages stagnate or fall when their is a labour surplus. And in a situation where automation is replacing human labour and unions aren't all that strong (ie: like the last few decades) people make less and less money.

If we had a good GAI system in Canada every time someone tried to hire someone with crappy pay and/or awful working conditions the potential employee could say "No. I don't think so. I'd rather live on the GAI until something better comes along." This would force the economy to stop being reliant on exploiting labour and instead invest more in improving productivity through smart management and intelligent use of automation. It probably will be the case that automation will force more people out of work, but those days are coming anyway. And a GAI would give people the time to educate themselves and develop new "side hustles" that would keep them occupied doing the sorts of things (like writing this blog) that are useful for human flourishing, but don't seem to be sustained by the market place.

The same problem faces housing. If there is so little housing available that people have no other option than going onto the streets, landlords can charge as much as people can bear---which leaves them almost nothing else. Indeed, that's why food banks are so popular now. People have to choose between rent and food. 

If the government could provide a cheap dorm or barracks room---for people who have a modicum of self-discipline---it would keep those folks off the streets. It would also lower pressure on social housing and shelters because they would be reserved for people who couldn't live in a barracks. It would also push down the cost of housing for lower income people because it would strengthen their bargaining power with landlords because the "last resort" wouldn't be freezing on the street, but rather living in a barracks until something better comes along. And building barracks for a subsection of the population who would find it suitable would be a lot cheaper than building apartments for every single member of the population who's having a hard time finding a place to live.

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I want to make a couple things clear. 

First of all, this isn't a universal panacea. It's something that I think could be of value for a specific fraction of the population. There are lots of people who have "issues" who would very quickly destroy a barracks through things like vandalism or just plain unwillingness to clean up their messes. There would have to be some sort of regular inspections for people. If they fail to meet a minimum standard, they will have to be evicted. 

That's why there will still need to be specific housing geared towards people who---for one reason or another---simply cannot be trusted to live in a citizen's barracks. These already exist, and they would still be needed. 

Secondly, this could be a very good idea---or it could be an absolutely dreadful one, depending on how it is executed. If people manage them under the impression that the people living in these places are "failures" who need to be "punished" in order to force them to get back to being productive members of our great capitalist utopia, they will fail miserably. Similarly, if people try to make them into schools for building a new model citizenry, they will also fail. People are people, and they should be allowed to get about their lives as best they can if they find themselves living in these new barracks.

Some folks will only see them as a temporary way station on their way to being a middle or upper class "respectable person". But I could see other people living in them for long periods of time. We already have lots of elderly, working poor, disabled, students, and, at-loose-ends folks living in rooming houses already. The difference between them and the barracks is that what I'm proposing could be a lot cheaper and more comfortable. And if society provided this type of housing, a lot more of the disability, pension, student grant, and, welfare money the government gives out would stay in people's hands---instead of going to landlords.    
So what do you think? Should we add Guaranteed Minimum Housing---in the form of citizen's barracks---to the idea of a Guaranteed Annual Income?

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Moreover I say unto you, the Climate Emergency must be dealt with!

 

Mike Schreiner Talks About Housing

On January 11th I had the opportunity to sit down with Guelph's MPP Mike Schreiner. One of the things I try to do with this blog is to avoid asking superficial questions in order to get what Mike calls "ten second answers". To that end, I put in a couple hours with him to dig out the background to the decisions he makes as Guelph's rep at Queen's Park. What follows comes from the first fifteen minutes of our conversation. I'm planning to add more in future posts.

Mike Schreiner making a statement on Mental Health day.
From the party website, cropped by Bill Hulet.

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Hulet: What do you think should be done about the housing problem that Guelph is facing?

The two biggest issues at the door have been housing and water. What we need is a "housing first" strategy for people with mental health or addiction issues. That's because it's difficult to get someone stabilized when they don't have a place to live. It's hard to get someone into the workforce if they don't have housing. It's hard to get access to essential service like healthcare, addiction service, etc, if they don't have housing. 

Taking a housing first approach isn't just essential for dealing with the homeless---it's essential for a whole lot of other social issues. 

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Here's a short video from the "Homeless Hub" where an expert describes what a housing first strategy looks like, where it comes from, and, how well it works.


The main thing to remember when we are confronted by a homeless person in distress is to ask ourselves a simple, yet profound question: "are they homeless because they are dysfunctional?", or, "are they dysfunctional because they are homeless?"

I first realized this issue when I got to know someone who had a significant mental illness (I assumed schizophrenia---but I'm not a psychiatrist) but had a trust fund and wasn't destitute. She was "mad as a hatter", but she was always well-dressed, owned and drove a car (that took some getting used to---although she seemed safe enough), and, had an apartment near the beer store on Woolwich. That was when I realized that a lot of what I associated with mental illness was actually a product of poverty, not the illness itself.

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Housing affordability affects a lot of people who you wouldn't think of having issues---young, middle-class, professional couples, university or college grads. I'm hearing about housing affordability from people like that---and from folks who are living in tents and moving from place to place to place. 

So it's a problem that requires a multi-pronged approach.

First, I'm a big believer in inclusionary zoning laws. I feel the Liberal government screwed-up bringing in inclusionary zoning rules. That left a bad taste in people's mouths. 

If you look at examples in the United States and Europe inclusionary zoning has been a hugely effective tool in increasing the availability of affordable housing stock. 

So from my perspective any new housing stock in Guelph---condo, rental, subdivision, townhouse---should have a minimum of 20% "lower market housing". Most places fund that through the developer. And they do that by offering the developer certain incentives. One might be a density bonus, or through accelerated approvals. You figure out a way it's incorporated into the cost of doing business for the developer and put in some "bonusing" to incentivize that.  

Where the Liberals made a mistake was that they didn't mandate a minimum percentage and instead mandated a maximum percentage---that was just 10%. And they said the city had to cover 40% of the cost. So that meant it was never going to happen.  

But affordability all starts with inclusionary zoning because that allows you to accelerate the creation of a stock of affordable housing. Part of the challenge is we don't have enough supply to meet demand in Guelph. 

And that starts accommodating the needs particularly of people with modest and working class incomes, as we make more housing stock available. That has a "filtering down effect" on the rest of the marketplace---for people who are more marginally housed.  

That would be everything. Clair-Maltby, the York Road Innovation District, Baker Street, projects in the Ward, stuff happening out on Willow---everything, minimum 20%. 

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The phrase inclusionary zoning was created in opposition to the term exclusionary zoning---which is a very commonly understood concept. Zoning bylaws have been created for a very long time to create areas in the city where certain types of "undesirables" are kept out of the neighbourhood. Inclusionary zoning is designed to ensure that these "undesirables" actually have places to live.

The USA has a longer history of using inclusionary zoning (where it is often called "inclusionary housing") than Canada. It came about there in reaction to racist housing policies that excluded blacks from large areas of cities, which resulted in shortages and high housing costs for the people least able to afford them. In addition, post-war governments in the US had traditionally built significant amounts of social housing for lower income people, but this was cut back during the general retreat of the welfare state since the 1970s.

Europe, on the other hand, has only recently started using inclusionary zoning within the last couple decades. That's because social housing has always been a much larger part of the market there than in North America (much larger than even the US government during it's heyday). It was only because of the growth of the "neo-liberal consensus" that the private sector has recently become a major player in the European housing market. At the same time, Europe has a different attitude towards the price of land as a part of housing costs. The consensus there is that any increase in value comes about because of government action (infrastructure, roads, libraries, schools, museums, etc), so it has the right to extract and use the "windfall profits" of real estate development to force the creation of affordable housing (in economics, this is called "betterment"). (For a brief discussion of these and other issues, take a look at this paper from the 42nd International Society of City and Regional Planners (ISOCARP).)

When Schreiner talked about the provincial legislation that governs inclusionary zoning, it sounded like the provincial Liberal government had passed inclusionary zoning legislation that restricts cities to being able to use it for only up to 10% of the units and has to pay 40% of the cost. But I think instead he was making more of a comment about the process whereby the eventual legislation was created rather than the final result. The numbers he was referring to were in the initial version of the bill that was proposed by the Wynne government in early 2018. But there was tremendous push-back by both municipalities and housing advocacy groups during the consultation process, which resulted in these onerous elements of the proposed bill being removed by the time it was eventually passed. But from a "public relations" point of view, this "roll out" was a total disaster because of the long-lasting impression it left with city Councils and the general public.

I looked through the part of the Planning Act that deals with inclusionary zoning.  As near as I can tell, the province gives cities a great deal of latitude to use this concept when creating new subdivisions. All they have to do is add it to their Official Plan.

This in itself is a hurdle. As I pointed out in a previous post, Guelph's current official plan was appealed by a list of eight different groups (seven businesses and one community organization) to the Ontario Municipal Board (OMB). This went from October 2014 to March 2018---during which time the Liberal government dramatically weakened the ability of the OMB to change municipal Official Plans. Since then, the Conservatives have resurrected the Board and given it back it's own powers. This means that municipalities are back to the "good old days" where they feel that they have to self-censor themselves to avoid successful challenges by developers in costly OMB fights. The implication for me is that this will cause Councils and staff to think long and hard before they propose "bold moves" with inclusionary zoning.

In addition, the Act sets out rules that say a detailed "Assessment Report" needs to be filled out by the city that details the following:

• demographics and population;
• household incomes;
• housing supply by housing type that is both existing and planned for in the OP;
• housing types and sizes needed as IZ units;
• current average market price and rent for each housing type, taking into account location;
• potential impacts on the housing market and potential financial viability of development or redevelopment from IZ by-laws on unit set asides, affordability period, measures and incentives and price or rent of an affordable unit, taking into account value of land, cost of construction, market price, market rent and housing demand and supply. The analysis must also take into account provincial policies and plans and official plan policies related to growth and development;
• written opinion of the impact analysis from a person independent of the municipality.

The legislation says that an Assessment Report needs to be done before Inclusionary Zoning is added to the Official Plan and needs to be done over again every five years after the last one in order to ensure that no new changes are required. In addition, every two years the city is required to provide to the general public a report that outlines the following:

1. The number of affordable housing units.
2. The types of affordable housing units.
3. The location of the affordable housing units.
4. The range of household incomes for which the affordable housing units were provided.
5. The number of affordable housing units that were converted to units at market value.
6. The proceeds that were received by the municipality from the sale of affordable housing units.

In addition, there are other specific rules governing Inclusionary Zoning. Two tremendously important ones are that inclusionary zoning doesn't apply to any project that has ten or fewer units, and,

(c) on or before the day an official plan authorizing inclusionary zoning was adopted by the council of the municipality, a request for an amendment to an official plan, if required, and an application to amend a zoning by-law were made in respect of the development or redevelopment along with an application for either of the following:

(i) approval of a plan of subdivision under section 51 of the Act, or
(ii) approval of a description or an amendment to a description under section 9 of the Condominium Act, 1998; or

(d) on or before the day the inclusionary zoning by-law is passed, an application is made in respect of the development or redevelopment for a building permit, a development permit, a community planning permit, or approval of a site plan under subsection 41 (4) of the Act.

It appears to me that this second rule basically means that all land that developers already own is, in effect, "grandfathered" under the old rules and cannot be subject to inclusionary zoning---simply because they can easily apply for an change to the bylaw once they see Council moving towards inclusionary zoning.

This is doubly important because there are increasingly very few greenfield developments left in cities like Guelph because of the Places to Grow Act (which I discussed in a previous post). This means that a great deal of new housing stock needs to be created through infill and "repurposing". This is where the first rule applies---inclusionary zoning doesn't apply to anything with ten units or less.

Schreiner's point is well taken about the need to actually set aside a percentage of the units in any given area of the city so there is housing for middle to lower income individuals. Unfortunately, in my humble opinion, it looks like the current legislation comes about 50 years too late to deal with the big housing problems that Guelph currently faces. What we need is some sort of regulatory framework that would allow cities to retroactively create inclusionary zoning. I have no idea how that would work, and I'm certainly not suggesting that Schreiner is proposing such a thing---even though as the leader of a provincial party that is theoretically in his area of responsibilities. But speaking from a strictly practical point of view his description has great merit---and might actually be the only thing that would really work. But I can't help but think that it could only be done on a large scale with enormous opposition from both developers and home owners.

Video still used by "Fair Use" provision, from the
You Can't Get There from Here website.

Having said that, there will be instances where inclusionary zoning will be a tool that Guelph can use---if the newly-resurrected OMB allows it. But unless there is some significant radical legislation from Queen's Park, it is easy to agree with Schreiner that a "multi-pronged" approach is needed.

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I'm hoping that some of you readers think about how much work I put into these blog posts and appreciate the effort. It is very hard to find the sorts of in-depth interviews with your elected officials that I try to do in the "Back-Grounder". Moreover, I try to research around their statements in order to see if what they are saying makes sense, and, to try to explain in detail a point that they may just be making in passing. If you like the results, spread the word. Also consider subscribing, either through Patreon or PayPal. I work very hard at this blog, and the indie media model is not going to work if people aren't willing to fund it. 

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The next thing for me is better utilization of our existing housing stock. That means laneway housing, secondary suites, granny suites, basement apartments, etc. We have a lot of "over-housed" people in Guelph. And we could quickly create a better utilization of our existing housing stock. 

I've talked to a number of realtors in Guelph just to get a feel of whether there is a demand for that. The feedback I've gotten is "yes". One day I actually walked around with a real estate agent. And she pointed out "that garage should be a granny suite", "that should be a laneway house", blah, blah, blah. 

It's a quicker way of "ramping up" the existing housing stock---which again has a filtering effect into the rest of the market, and it provides additional income for people---especially aging baby boomers, who maybe need less housing---but want to stay in their homes. 

There area a lot of people who are aging and facing housing affordability issues. This is a way to increase affordability for people who already own a home. And it increases the stock of housing on the market. 

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When Schreiner talks about "filtering", he's mentioning an important concept that tends to be ignored by most of the people interested in housing affordability. Basically, the idea is that existing housing stock declines in value as it ages, which makes it more affordable. To understand this, I think about all the rundown apartments and shared rented houses I lived in when I was a university student and poorly-paid janitor. These are also the "starter home", "handy-man specials" that my siblings and I bought and fixed-up using "sweat equity".

Unfortunately, if a housing market heats up too much---as it has in Guelph---housing stock doesn't decline in value anymore. This means that existing apartment owners will put money back into fixing up their units, because they know that they can keep raising the rents without ending up with empty spaces. It also means that people with a lot of money will buy up "fixer uppers" and either bulldoze the building to replace it with a "new build", or, hire expensive contractors to renovate the property. Both of these processes cut down the existing stock of cheap housing and prevent new filtering from taking place. This is the process known as "gentrification", which pushes low and medium income people out of neighbourhoods.

Filtering ceases and gets replaced by gentrification when the demand for housing outpaces the supply. Schreiner is suggesting that in order to stop gentrification and start filtering again the city needs to find a fast way to move from a housing deficit to a slight surplus. And, he thinks the most practical option would be through increasing the number of "informal units" in low density neighbourhoods---lanehouses, tiny houses, basement apartments, coach houses, etc. Not only would this be the fastest approach, it is all within the legal power of the city---so no money or legislation from other levels of government would be necessary.

There is, however, a "600 lb gorilla in the living room". That is that a lot of people who already own their own homes don't want more people living in their neighbourhood. That's why we have all these zoning regulations in the first place. (That's the exclusionary zoning I mentioned above.) One of the key places where this arrives is with regards to parking.

When people rent out a room, basement apartment, granny flat, etc, to someone to help pay off their enormous mortgage, that renter usually wants a place to park her car. And when the city "trades off" required parking to get more affordable housing units (a common play in inclusionary zoning---because parking is astronomically expensive to build), there are invariably complaints from existing home owners about the increased levels of on-street parking and other owners paving their front yards to increase parking spaces.

You only have to be a casual observer of development in Guelph to see people's concerns. Take a look at this June 11th article by Graeme McNaughton in The Mercury/Tribune about a proposed townhouse development. It contains the following quote:

While delegates spoke to the impact this would have on the area’s greenery, another issue also saw a number of comments: where is everyone going to park?
“It is at maximum capacity,” resident Rubina Heddokheel said of the current on-street parking situation in the area.
“There's no parking available, ever.”

And here are a couple comments about another article by McNaughton on October 24th, 2018 about a proposed 800 unit townhouse complex proposed near the CostCo.

I spoke to three of the ward 4 candidates when they canvassed. Not one mentioned this development. And I did bring up both city expanding in this area as well as township use of there lands ( that potential for the glass plant raised a lot of eyebrows in this area). Here’s an idea. How about a developer submits a plan for single family dwellings in this area.

802 parking spaces for 800 units?

And, I know that once the condo tower at the old Marsh Tire site opened up, there were hordes of cars parking at the curb all through my neighbourhood. (I talked to a couple people about this, they said that the visitor parking at the complex is far too small for demand, so they have to park at places like the curb in front of my house instead.)

I think that any politician who really wants to help with housing needs to come up with some sort of strategy for changing public opinion about increased density. There also needs to be some appreciation of how absolutely devastating parking issues can be to creating a good housing strategy. Unfortunately, politicians who tell people things that they don't want to hear generally do not get elected, so I can understand why they try to "accentuate the positive". But somewhere, somehow, this parking issue needs to be dealt with. And, who better to do it than a Green Party MPP?

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The next idea is we need government to build more supported housing. We have a lot of people who face problems of poverty and mental health---even if we create a lot of housing stock and filtering lowers prices for a lot of people, there are still going to be people who for these reasons are going to need more supports around them. We haven't built enough supportive housing in Ontario. That is going to have to come from government funding.  

We need changes to our municipal bylaws, but also to the Planning Act to allow for alternate types of housing to be easier to build, develop and access. What I mean by that is co-housing, tiny homes, community shared housing, etc. As an example we have a 30 foot frontage bylaw in Guelph that prevents the creation of tiny homes. 

Guelph Architect, David McAuley.
Image c/o Bookshelf Cafe, used
under the Fair Use provision.

A lot of people in Guelph would like to have tiny homes. There are bureaucratic planning and bylaw barriers to building new types of housing. I know David McAuley is trying to build a co-housing project up on Speedvale for seniors and he's running into all kinds of planning and bylaw barriers to making it happen.  

If we removed some of the impediments to building new forms of housing and habitation, that would again build up supply, and that would have a filtering effect.

The final piece is a reinvestment---I see the federal government doing this because I don't see the province doing it. We need more co-op housing, more social housing, government supported housing as well. 

For me, if you take a multi-pronged effort we can go a long way towards solving the affordability crisis. 

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One final point. Most of what I've mentioned is medium to long term. We have some very short term things that need to be dealt with right now. One is shelter space, two is opening warming centres. (I don't know where---my office, City Hall, the Armouries.) We have people sleeping on the streets in the dead of winter. [This interview was recorded in January, remember.] 

The survey said 300 [Mike is referring to the Guelph Homeless Survey, which had recently been done when the interview was recorded] but that's probably under-estimated---people sleeping on the streets and they need some place warmer. I've gone to the Drop In Centre and sat and listened to people. Most of these folks are just desperate for a place to sleep---tonight! 

A lot of these folks seriously consider getting arrested, because at least a jail cell has heat. That's a pretty sad state of affairs. 

Hulet: It's also a huge waste of government money.

A huge waste of government money! 

[According to the John Howard Society, the annual average cost of keeping someone in a provincial jail is $67,000. That would cost about $184/day. Surely it's cheaper to provide a decent warming centre!]

Another one is to get creative about tent cities. Right now we waste a ton of government money, and do significant harm to people's lives---I think---by shutting down a tent city. People lose their home and then they move somewhere else. In Guelph and then months later we shut that tent city down, and then they move somewhere else. 

I don't know entirely what the solution is---but that's a problem that we need to tackle. And we need to do it in a way that provides supports and services to people without destroying their home every month. It might not be much, but it's something---and we're taking it away month to month to month.  

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Reading through this transcript I'm struck by one thing that I hadn't noticed before. Mike Schreiner has a great deal of compassion towards the poor and distressed. He's obviously spent a great deal of time thinking about these issues and seems to be searching for the best solutions he can. This should dispel any idea that as a Green he doesn't care about anything but the environment.

I also think that it's important to recognize the breadth of ideas that he is dealing with. He's obviously spent a lot of time reading on the subject. He most definitely isn't just repeating some "talking points" that were prepared for him by some staffer. I think we could have done far worse when the city elected him to represent us at Queen's Park.

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Furthermore, I say to you---the climate emergency must be dealt with!

Social Housing and Guelph

Synopsis

Social housing is controlled by the county, yet the lion's share of the county's units are in the city. In addition, most of the money that gets spent on it comes from the federal and provincial governments. And those two levels of government have a long history of using that money as a "political football" that comes and goes in response to the back-and-forth battles between left and right. Put into the context of the entire economy and the private development sector, however, the average financial commitment has tended to be woefully inadequate. Indeed, it is hard to believe that any government would be willing to put the amount required to actually deal with the enormous housing problems that we currently face. To this end, it is pretty clear that any municipal government that really wants to address the housing backlog in Guelph is going to have to undertake actions that will be profoundly unpopular with a large part of the electorate. 

What is "Social Housing"?

It's important to realize that there are two components to the idea of "social housing". First, there is the actual building being constructed, which generally has some sort of subsidy towards its creation. An equally important element is a monthly subsidy by the government to the landlords of individual tenants, which is called "rent-geared-to-income".

Rent-geared-to-income is a provincial program governed by the Housing Services Act of 2011 (this link provides updates to 2018.) It is really, really, really hard to understand this act and obviously requires a social worker to navigate through the dense legal language to understand who is and is not able to get this help. (Just to give you one example, the people who are helped out under this program aren't identified as "people", "families", "households", "clients", or, "recipients" but rather as "benefit units".) But as a general rule, people who qualify for rent-geared-to-income find that the cost of their housing is restricted to about 30% of their income. You cannot get rent-geared-to-income in just any apartment, however, as this would encourage private landlords to gouge the province. Instead, the money is tied to specific units that are generally built with money provided by the federal government or the province through specific funding programs. These housing units come in a wide variety of forms---depending on who lives there, and, how they are owned and administered.

One way to think about the different types of housing is to consider how they are owned and managed. In the city of Guelph there are 52 different complexes that provide a total of 2,473 units of social housing. You can break these down into five categories of ownership:  

• non-profit corporations (952) (these can include both Non-Government Agencies (NGOs) and the city of Guelph)
• housing co-ops (253)
• county-owned (882)
• Affordable Housing (27) (defined as being 20% below the average market rent)
• "Rent Supplement Housing" (183) (housing that is privately owned but which has units that the County assigns to people where rent-geared-to-income money is paid directly to the landlord)  

Non-Profits

A non-profit corporation is an incorporated, limited liability company. "Limited liability" means that under the law the individuals involved do not have any personal financial responsibility for the company (unlike a partnership.) A "non-profit" corporation has no obligation to shareholders to make a profit (this is the "fiduciary duty" that I mentioned towards the end of one of my articles about solid waste issues.) Instead, the  duty of the organization is towards the ends that the incorporation articles set out in their charter---in this case, providing low cost housing for people in need. A non-profit need not be a "charitable" company, as that specifically refers to the ability of a group to issue legal tax receipts to donours, which is tightly regulated. (Even though as a matter of fact, some housing non-profits are charities.) Some of Guelph's non-profit housing corporations do have a relationship with larger charities---such as the Abbeyfield Houses Society of Guelph, which is part of a national charity that began in Great Britain.

As a general rule, however, non-profits tend to act as "subcontractors" for the federal and provincial governments who take on the task of applying for money from government programs that fund social housing. They also apply for grants from "hands off" government-supported charitable agencies---like the Trillium Foundation---to build and administer these social programs.

In addition to the Non Government Agencies (NGOs---like Abbeyfield), we also have the Guelph Nonprofit Housing Corporation. According to it's website it has 512 rent units", of which 80% are rent-geared-to-income and the rest are "market priced" (that's something like 410 units.) It has a contract with the county that means that all of the Guelph properties are managed by the same staff that deal with county-owned ones.

Co-ops

In contrast, a housing co-op consists of people who band together to create and manage a housing complex that they "own" co-operatively. It's important to realize that is a system that is different from standard "freehold". There are two ways that a co-op can be organized: "equity" and "non-equity". An equity co-op allows each individual owner the right to sell their property (the individual apartment or townhouse unit they live in) to another person in order to recoup the money that they personally put into it. These sorts of co-ops are very common in other countries, but exceedingly rare in Ontario. (A condo is different in that it is organized and built by a private developer for a profit. A co-op is organized by the owners at-cost.)

Instead, what we generally have are non-equity co-ops that were built under a federal program that operated in the 1970s and 1980s. Under that system, governments supplied start up capital that citizens used to build the housing complex under the understanding that a certain percentage of the units would be set aside for low-income individuals under a rent-geared-to-income scheme. In exchange for this help, the co-op members forgo building any equity in the complex---all capital accrued instead is deemed as belonging to the co-op as a whole. Theoretically, once the money loaned by the government is paid back, rents might be lowered. But in actual fact by the time this happens most of the money raised by rents end up being ploughed back into maintenance. Rents tend to be lower in general, however, because their is no owner taking a profit.

The program to create co-ops were primarily introduced on the assumption that they would prevent a city from shunting all lower-income people into one area. This had been attempted in many social housing programs in the 1950s and 1960s, and it was believed that they failed because a certain fraction of the poor tend to make "bad life choices" (think crime) which tended to drag under other people who were struggling to "get ahead" but who were poor through no fault of their own. Co-ops were designed to have a mix of people from all classes, which would prevent this problem. For a variety of reasons (beyond the scope of this article) the program that supported them was cancelled in the 1980s and they are no longer being built as part of social housing.

(Having said that, there is no reason at all why individuals cannot use their own private capital to build equity co-ops---and I know of at least one current Guelph project "in the works". But these would not be independent from the current market forces---so they would not necessarily be any more affordable than any other type of housing. As such, they have nothing at all to do with social housing.)

County Owned

Wellington county also owns outright a large number of properties that it provides to people of limited income. The lion's share are in Guelph---because that's where most of the need exists. But having said that, it also owns properties in other parts of the county:  Fergus, Elora, Erin, Rockwood, Eramosa, Mapleton, Minto, Arthur, and, Mount Forest. Since this blog tries to deal exclusively with Guelph matters, I won't be dealing with any of these properties. Suffice it to say that there is a need for social housing just about everywhere.

Affordable Housing

As part of the on-going attempts by Council to help the housing crisis, the city of Guelph has been attempting to negotiate with developers to bring in new affordable units whenever a new proposal comes before them. (I talked about this in a previous post.) Some of this has been done through the use of subsidies---either directly or through deferred taxes. The result has been a stock of so-called "affordable housing" units, which is defined as being "20% below the market average".

According to the numbers I found in my first article on housing, here are the average rent costs for various sized apartments, followed by their "affordable cost" (ie: 80%), then the yearly income that a household would have to make to make this equal to at most 30% of their gross income. The way to understand the math is that if you are paying 30% of your monthly income in rent, you can get your monthly income by multiplying your monthly rent by 3.33. And that translates to your yearly income by multiplying by 12. But you can simplify the calculation by multiplying the 3.33 by 12, which gives you 40. So to find out the yearly income of people who are only paying 30% of it in rent, you just multiply the numbers by 40. Unless a rent really is 30% or less than your income, it is hard to say that it is really "affordable". The last number is this hypothetical income where what the city calls "affordable rent" is only 30%.

• bachelor apartment: $750 (average), $600 ("affordable"), and income of $24000.
• one bedroom: $980 and $784, and income of $31,360
• two bedroom: $1,124 and $899, and income of $35,960
• three bedroom: $1200 and $960, and income of $38,400
• average cost of an apartment: $1,066 and $853, and income of $34,120

And again, as I mentioned in my other articles on this subject, the problem is that household income is too low for this definition of "affordable" to be of any service to the poor. That is, if you break down Guelph household income into six groups, you see the following:

• less than $20,000/year, 5,770 or 10.5%
• $20,000 to $40,000, 8,320 or 15%
• $40,000 to $60,000, 8,920 or 16%
• $60,000 to $80,000, 7,635 or 14%
• $80,000 to $100,000, 6,690 or 12%
• $100,000 and over, 17,530 or 32%

The numbers aren't precise, but at the very least 10.5% plus some other figure---let's assume 4.5%---of the households in Guelph (ie: 15%) make less than $24,000/year in gross income. This means that what Guelph defines as affordable really isn't "affordable". For this reason, it's hard to believe that "this affordable housing" category really has an significant impact on housing issues---especially since there are only 27 units in the city.

Rent Supplement Housing

These are privately-owned apartments that the county has entered into an arrangement with to provide rent-geared-to-income. The supplement is paid directly to the landlord. Obviously in a hot rental market like Guelph most landlords would rather rent to the general public. But there are some buildings that for one reason or another the landlord is happy to rent out this way and the county considers "value for the money".  I suspect that there could be issues to pursue here---but this article is already ballooning in size, so I'll leave it at that.

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Federal and Provincial Social Housing Initiatives:  History 101

I had mentioned early on that the federal and provincial governments had been involved in building social housing. I also mentioned that housing co-ops were primarily built under a program that was cancelled in the 1980s. There have been a great many different programs and it would take a lot of time to explain the timeline. Luckily, the Ontario Non-Profit Housing Association (ONPHA) has created this nifty graphic that shows the various programs that the federal and provincial governments have set up, starved for funds, and, eliminated over the years between 1945 and 2011. I'd suggest that anyone who is interested in this subject take the time to linger over it, and make the effort to think about what was going on in the larger Canadian society. Consider, for example, that Jean Chretien was prime minister at the time (1993) that the federal government decided to stop funding any social housing---I assume as part of the general attempt to balance the budget. You can also see that Mike Harris was premier of Ontario when the provincial social housing program was also cancelled (1995.) (I suspect that this was when I remember seeing beggars show up in downtown Guelph for the first time. Politics has consequences in people's lives.)  (Sorry, but this is the best resolution of the graphic that I could get.) 

The Context

I don't have the time to write a complete history or synopsis of federal and provincial social housing policy---and I'm pretty sure that most of you wouldn't read it if I did. But I think it's important to realize a few points.

First of all, ask yourself "What fraction of society is this housing program supposed to be helping?" Canada has several different housing problems going on all at the same time. These include housing on First Nations' reserves. It also includes providing housing for people who are in crisis because of mental illness, drug addiction, physical disability, or, spousal abuse. As well, there are huge geographic areas---like the Greater Toronto Area (eg:  Guelph)---where the commercial real estate market has decoupled from the incomes of most people and no longer provides affordable housing for many middle and lower-income people. All these needs are something that different levels of government need to deal with, but require a huge amount of money. Equally important, each constituency has dramatically different levels of influence over public policy. In a democracy there always is a tendency for politicians to deal with the problems of people who carry lots of votes over those who objectively may have more real need---simply because of electoral concerns. So, when a proposal comes forward for social housing, it's important to ask "social housing, for who?" As I pointed out above, the fraction of housing called "affordable housing"---as defined as being 20% less than the average market rent---appears to only be aimed at lower middle-class people instead of the genuinely poor.

Secondly, it's really important that any program that a government puts forward be placed in a context. When a government minister announces that so much money has been set aside to provide housing for so many households, it is tremendously important to always find out what percentage of the budget the money provides and what percentage of units this will provide to the entire housing market. For example, according to the 2016 federal census, there were 55,900 places to live in Guelph. Of those 5,470 were social housing of one sort or another---or 9.8%. As I showed above, the actual need---as defined as rents for 30% of gross income or less---is really something like 15% of the population, or, 8,390 households. This suggests that if the only way that Guelph can provide affordable housing for the poor is through social housing, it has a backlog of almost 3,000 units.

I don't have a figure for how much it costs to create an average unit of social housing---and I would be dubious about any such number if it was presented to me simply because there are so many different types of housing that fall under that umbrella, and, the cost would fluctuate wildly from community to community based on the cost of land. But to get a feel for the amount of money involved, let's look at something that the city staff have developed a figure to describe. As I mentioned in my last article, city staff have suggested that a subsidy of $60,000/unit is necessary to get private developers to create new "affordable" housing. What this means is that if the County, Province, Federal Government, etc, were to use this subsidy mechanism it would cost something like 174.9 million dollars in Guelph alone to deal with the shortfall in social housing. And let's not forget that this isn't the real cost for creating social housing. Instead, it's the price of creating apartments that are 20% less than the market average for a limited amount of time. And at this price they are unaffordable by that bottom 15% of the market that are most in need of housing. Social housing units that really do help the desperately poor would cost a lot more per unit. Just to put this figure of $174.9 million into context, the entire operating budget for Guelph in 2018 is $233 million.   

I think that the magnitude of the housing problem really needs to be understood. The federal government recently created a "National Housing Strategy" that commits to spending $40 billion over ten years. This sounds like an astronomical amount of money, but the casual reader needs to remember a couple things. First, this only comes down to $4 billion per year. Secondly, this is for the entire country. Think of it this way, Guelph only has a population of 131,900 people. Canada has 36.29 million. This means that Guelph has only .3635% of the population of the entire country. That means that proportionally the federal government has committed to providing $14.54 million to Guelph. This is nowhere near enough money to effectively deal with the crisis we are currently facing. And don't forget that Guelph's population is growing rapidly and it's stock of existing, low-cost housing is shrinking because of gentrification. 

We also have to admit to ourselves that social programs---like creating and maintaining social housing---is always going to be treated like a political football. That means that programs will be "spun" to look bigger than they actually are, and, cancelled for totally capricious reasons. To cite a couple specific examples, consider the fact that the federal Liberal party announced that their funding was "$40 billion over ten years" and that $500 million dollars was set aside in the provincial Climate Action Plan to maintain and upgrade social housing in Ontario. Trudeau's government has no way of knowing what will happen to their government after the next election---let alone in ten years. And our dear, beloved new Premier just ripped up the cap-and-trade agreement that was funding the Climate Action Plan---which means no money for social housing buildings to replace worn-out heating systems.  

I've discussed social housing in some detail because I've had local politicians tell me that the real solution to the housing crisis is to get the federal and provincial governments to build more social housing. But when I began to understand the scale of the problem, it seemed to me to be total moonshine to think that the electorate will let politicians of any stripe make that size of social investment. It might actually be true that this would be the best way to do things (see the example of Vienna I raised in my last article), but it just doesn't seem politically feasible in Canada. Moreover, social housing has historically seemed to be easy to cut when voters are more concerned about taxes than they are about homelessness. Once you accept this unpleasant truth, the interested citizen is left with the question "well, what exactly are we supposed to do?"

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I'm not about to suggest that the federal government shouldn't be building new social housing. But we need to see social housing as a last resort instead of the be all and end all. Government simply lacks the financial resources that would be needed for the task at hand. The only answer that I can think of to solve the mess we are in is to bring in private developers. Whether individual readers agree with capitalism or not, the fact of the matter is that Canada is a social democracy. And that, fundamentally, is based on the idea that we allow private business people to run huge swaths of the economy. But it isn't a libertarian utopia---we believe that democratically-elected governments should step in and nudge businesses in directions that serve the public good. That's why we have inspectors to ensure that butchers don't sell people contaminated meat. It's also why we have public planners who force developers to build housing that doesn't immediately degenerate into slums. But somewhere in the planning process the idea that zoning should ensure that there is an adequate supply of housing for everyone has been forgotten.

As I have pointed out in various articles, there are a variety of ways in which our zoning seems designed to make housing not affordable. We pass zoning bylaws that mandate far too much required parking---which mean that it is illegal to build walkable "down towns" with apartments over the top of stores. It also means that the driveways for houses cannot be widened to provide parking for basement apartments---and that owners who lack the extra parking can't even rent to people without cars. For years the OMB ruled that any type of increased density was illegal in any area where people lived in individual houses---so as to "protect the neighbourhood character".  We have rules against building towers any higher than an arbitrary limit "to preserve the sight line". We mandate what seems to be a very large amount of parkland (one hectare---the size of a football field) per 1,000 residents (about 300 apartments.) We have regulations to prevent sprawl in order to prevent encroachment on farmland and water recharge areas.  The last of these regulations is important and should be preserved, but the others should be relaxed in order to let developers increase the housing stock at least to the point where everyone has a place to live that they can afford.

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There is an important real estate concept that I came across while reading a Parliamentary Research Paper on the history of social housing in Canada: "filtering".  This is the idea that when a building gets to a certain age the rents it charges tend to decline. I'd never come across this term before, and further research told me that housing policy rarely considers it's impact on affordability. But once I understood the concept, I immediately understood its importance. When I was a student and afterwards when I was working at crappy janitorial jobs I lived in nothing else than old, cheap apartment buildings or run-down shared houses. Guelph used to be filled with them. But when I think about where I lived then, every single one of those buildings has been renovated and "gentrified". Indeed, my current home is an old, middle-class home that had gone through a "filtering" process over 100 years. First it was duplexed in the 1950s, then it ended up a run-down boarding house for students before I bought it. Over twenty years I fixed it up and is now worth a great deal of money. This is "gentrification" and that's a concept that everyone understands. What they don't is that filtering and gentrification are the opposite ends of a housing continuum. When there is an adequate, optimal, or, surplus supply, housing for the poor is created by filtering. When there is an inadequate supply of housing, what little does exist gets removed by gentrification. Filtering has ceased in Guelph and gentrification has dramatically cut the supply of housing for the poor. The solution to this change is not to chastise people for fixing up old houses and apartment buildings, but to instead increase the supply of new houses to the point where there isn't so much competition that filtering gets totally eliminated.

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According to an article by Christopher Chung in The Tyee, Vancouver politicians are beginning to seriously consider tackling that city's housing crisis by changing the zoning policies across the entire city---including the hitherto sacrosanct areas that consist exclusively of single family houses. As he reports

Independent mayoral candidate Shauna Sylvester is also for zoning reform. Yesterday, she tweeted points from her housing platform: “Instead of just stacking people along big, busy streets and arterials or building condo towers at busy centres, I want to create opportunities for human-scaled homes in real neighbourhoods.”

Doesn't the line "stacking people along big, busy streets and arterials or building condo towers at busy centres" sound familiar? If it does, it's because that is exactly what is being done in Guelph. The downtown and the Gordon Street bus line seems to be the only place in the city where developers are allowed to really pull out all the stops and build a lot of intensive housing.

According to Chung this idea isn't just something being put forward by fringe candidates, either:

Outgoing Mayor Gregor Robertson wants staff to go farther and look into the possibility of allowing “triplexes, quadplexes and other multi-unit forms to significantly bring down the purchase cost per unit of housing in low-density neighbourhoods.”

Indeed, I listened to a Vox "The Weeds" podcast on this subject this summer and it seems that the core problem with housing just about everywhere is not that there isn't enough housing being built in the poor parts of town, but rather that most of the land belongs to the more well-off and they don't want any new housing built in their neighbourhoods. (Unfortunately, I don't seem to be able to add a link to the episode due to a compatibility problem between Linux and the Apple universe. If you want to see if you can get it to work, the episode is titled "We're Not Going to Pay Rent" and was originally aired on August 17th, 2018.) And when you look at the rules that Guelph has governing zoning, it is very hard not to believe that ultimately this is what underlies a lot of it---the people who already own houses simply do not want to be even slightly discomforted in order to provide housing for other people. Indeed, at a recent municipal breakfast meeting I had this attitude starkly presented to me. A fellow baby-boomer told me that he wants the value of his house to go up and up forever because that's money in his bank. When I suggested that we need to think about other people, he said "I own my own home, and so do my children. I don't care about my grandchildren, and I certainly don't care about anyone else's. I did OK and they can find their own way." 

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I will let that statement speak for itself. Thus ends my series on housing in Guelph. My next article will be on a very different subject. 

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And now a word from a poorly paid, yet hard-working writer---.

For many years I was quite bitter about the quality of journalism I was reading. For example, I would get angry when a reporter just repeated a figure from a politician instead of attempting to describe it as a percentage so the reader could put it into a context. I'd say to myself "why couldn't that guy to a little bit of research to figure out whether or not this is a substantial issue or just more empty spin?" Writing this blog has given me some insight into this. Research takes a LOT more time than simply showing up, asking a few questions, and, editing the response into a story. 

I have also learned to respect those reporters. By hammering out those little stories they were recording the history of the community. Now that they are gone we aren't creating a record of the city for future generations. Some future version of myself will not be able to go to the public library and wade through volume after volume of copies of the old "Guelph Mercury" to learn in detail what was happening in the city back in the early 21st century. That really is a tragedy. We do have a group of people trying to fill the gap---guys like Adam Donaldson and myself. But we need community support if we are going to make this business model work. Nothing that requires this level of effort can be sustained unless people get paid to do it. (And certainly, unless some more money comes down the pipeline, everything we do is just one computer crash away from disappearing forever.) 

I get new supporters as I publish new articles. (Thanks to Stephanie, Ralph, and, Nina for being so awesome!)  But I need to keep reminding folks to support the Back-Grounder. As little as a dollar a month helps---if lots of people do it. You can use the Patreon button at the upper right side to set up a regular subscription and there is also a "tip jar" for one-time contributions.  Even if you can't afford to help financially, it really helps if you spread the word through your favourite social media. My last article went viral, and that works wonders for subscriptions.