Op-ed by Mayor Gregor Robertson, published in the Vancouver Sun
For most of us, housing is our biggest expense. One out of every five dollars we earn goes to build, buy, rent and run our homes. Facing high home prices, large personal debts, and an uncertain economy, fewer Canadians can buy a new home today than in the past, and they are choosing to rent instead.
Unfortunately, in many cities, finding an affordable place to rent is nearly impossible.
The most immediate problem is supply. Vacancy rates under three per cent push rents up; here in Vancouver it’s 1.4 per cent.
Vacancy rates this low force our young people to move out of the city, threaten seniors on fixed incomes, and have a negative impact on local businesses.
That’s why this spring’s federal budget must put Canada’s rental housing market on solid ground, by pursuing low-cost, high-leverage policies that get jobs on the ground and build housing Canadians can afford.
Building and renovating rental housing will give cash-strapped Canadians more affordable housing options in a time when they’re being increasingly priced out. It will also create thousands of construction jobs to replace the 50,000 lost to slower new housing starts.
We’re calling on the federal government to use its spring budget to introduce cost-effective market incentives to encourage private-sector investment in rental housing.
. Low-interest loans underwritten by the Canada Mortgage and Housing Corporation (CMHC) to finance new rental construction.
. Tax reform to encourage owners to renovate and retain rental properties, providing an incentive to preserve affordable rental housing.
. Help for landlords to make rental housing more energy efficient, reducing costs and easing pressure on rents.
Each of these measures is designed to encourage private investment where it’s needed the most. While each has costs, they will generate enough direct economic activity and indirect long-term economic growth to offset these costs.
Under Canada’s Economic Action Plan, federal, municipal and provincial/territorial governments worked together to create jobs, fight the recession and build our cities.
Now that stimulus spending is over, we must keep the economic recovery on track. An important first step is building a strong, sustainable rental housing market that creates jobs and meets the housing needs of Canadians.
Vancouver Mayor Gregor Robertson is chairman of the Federation of Canadian Municipalities’ Big City Mayors’ Caucus.