February 10, 2014
A Backgrounder for the Housing Action Lab on the Future of Housing in the Greater Toronto and Hamilton Area
This paper provides context and background on housing in the GTHA to help build a shared understanding of core elements, threats, and assumptions. It was prepared for Evergreen’s Housing Lab. The Mowat Centre produced this background brief on the region’s housing system challenges and available policy tools to support the Housing Action Lab being convened by Evergreen CityWorks and its partners with the goal of identifying and advancing scalable solutions that can help to overcome these threats.
The Greater Toronto and Hamilton Area’s (GTHA) housing system is increasingly failing to serve the region’s needs. Trends in land use and built form have encouraged inefficient sprawling development and energy-inefficient construction that is ecologically unsustainable and costly for municipalities, landlords and residents alike. Rising income inequality, soaring housing costs and the shortage of new affordable housing (especially rental) have all resulted in an affordability crisis for many low- and middle-income households while environmental pressures persist.
Our housing system is fragmented, with a range of governments, public agencies, residents’ groups, private enterprises and other organizations undertaking activities with little shared understanding of mutual interests and opportunities or shared vision of the overarching challenges, the public policy objectives, and how incentives can be aligned to help address them. As it stands, these widespread private concerns are not viewed, or organized, as public issues. As a result our region faces environmental, affordability and economic threats to our quality of life.
In response to this, Evergreen CityWorks and its partners are initiating a multi-year project to examine our system with the goal of identifying and advancing scalable solutions that can help to overcome these threats.
This brief is the first step in that conversation. Its purpose is not to identify solutions, but to provide context and background and to begin to build a shared understanding of the core elements of our housing system, to understand what factors produced these threats and identify our underlying assumptions about our housing system.
Our current housing system is not well-equipped to meet the needs of our population.
• Our current housing system presents an affordability threat. For too many households, the cost of adequate and suitable shelter is out of reach, creating ripple effects throughout their lives.
• Our current housing system presents an economic growth threat. Sprawl and congestion hurt productivity and high costs of housing dampen growth because people spend too much of their income on housing.
To address these threats, we need to understand the core elements of our housing system.
The interests and decisions of households, housing market actors, and government all shape our housing system in different ways. While we all share a collective interest in a well-functioning system, individual decisions by households and housing market actors reflect different priorities.
Decisions by individual actors are shaped by a wide range of incentives by governments. The broad policy landscape of investment tools, legislative and regulatory approaches, and revenue-related tools include a number of direct and indirect ways to shape those individual choices to support a well-functioning housing system for the GTHA.
The way these policy levers influence decisions is also framed by some important contextual challenges in the GTHA housing system. These include cultural expectations about home ownership and user fees and the fragmentation of responsibility and authority for the housing system between governments, between government departments, and between different housing system actors.
Scalable solutions to overcome our housing system need to bring together the disparate elements of the housing system to work in one direction.
• We have a number of major policy levers in effect to shape our housing system to better meet our needs (for example, The Big Move and the Growth Plan for the Greater Golden Horseshoe). However, these efforts alone have not been enough to overcome the housing system threats.
• The major challenge for the Action Lab is to find ways to start a new conversation, one that brings together all of these working parts in a way that makes clear what we need from our housing system and ensures that our investments, rules, and efforts all move in that direction.
• From that new foundation, the Action Lab can identify testable, scalable solutions to overcome the threats to our region posed by our current housing system.
February 10, 2014