Tuesday, November 5, 2024

What European housing models could do for Canada’s affordability problems

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TORONTO — Housing experts who have long promoted moving new home construction from suburbs to urban centres are calling for a similar approach to policy, saying several ideas currently percolating on the fringes of society in Canada have proven successful elsewhere and deserve a more central place in the national conversation.

They argue widespread adoption of government-supported affordable housing, the growth of alternative models like co-operatives and co-housing, and the increased use of advanced building techniques could all play a role in improving Canada’s housing system.

Such ideas, which have started to gain more traction in Canada in recent years, are already well-entrenched in many parts of Europe.

“There’s plenty of really exciting examples for Canada to learn from,” said Carolyn Whitzman, senior researcher at the University of Toronto School of Cities and author of the recently published book “Home Truths: Fixing Canada’s Housing Crisis.”

The situation in some places like Vienna — where a quarter of residents live in social housing — came about through very specific historical circumstances, but other regions show what’s still possible today.

France has committed to making 20 per cent of its housing “non-market” — whether government-subsidized or otherwise outside the private sphere — through a combination of buying buildings and constructing new ones. It has already reached the roughly 17 per cent mark while managing to integrate the homes into existing neighbourhoods to maintain diversity, Whitzman said.

She noted Canada had adopted the same non-market building targets in the 1970s, but abandoned the approach in the 1990s when the federal government got out of the business of housing construction and funding dried up.

Places like France, Denmark and Austria have made longer-term funding plans for affordable homes by implementing systems where governments provide subsidized loans, which, when paid back decades later, are then recycled into new ones.

“That sort of revolving fund is like a gold standard because it means that the policy is sustainable,” said Whitzman. “It does need to be thought of in 30-year timelines.”

The Danish system has helped create about 21 per cent non-market housing as of 2022, according to the most recent data from the Organization for Economic Co-Operation and Development, which notes the Netherlands stands at 34 per cent. Canada has about 3.5 per cent, the OECD found.

The federal government has rolled out numerous funding programs to increase housing, including a $55-billion apartment construction loan program, a $14-billion affordable housing fund and $4 billion for the rapid housing initiative.

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