More Canadians find “no vacancy” when trying to rent, says FCM report
July 4th, 2012 - 2:12pm
OTTAWA - A report released today by the Federation of Canadian Municipalities (FCM) is sounding the alarm on the shortage of rental housing, which threatens Canada's economic recovery.
"Renewed investment in rental housing is crucial to protect Canada's economic recovery," said FCM president Karen Leibovici. "It will create new construction jobs, give cash-strapped Canadians more affordable housing options, and ease pressure on the home-ownership market where mortgages account for 68 per cent of skyrocketing household debt."
The report, No Vacancy: Rental Housing Trends in Canada, finds the shortage of available rental housing is worsening at the same time that more Canadians are being priced out of home ownership. The report is part of FCM's Quality of Life Reporting System (QOLRS) report series which highlights trends in 27 municipalities and urban regions that account for more than half of Canada's population, and includes many of Canada's largest urban and suburban centres.
Data collected from these 27 urban and suburban communities show household income failing to keep up with homeownership costs, which have risen three times faster than income since 2005. At the same time, the number of rental units has declined and the cost of renting in the QOLRS communities has grown by more than 20 per cent since 2000.
Although one third of Canadians are renters, less than 10 per cent of new housing starts in the QOLRS communities were intended for the rental market between 2001 and 2010, while existing rental units were converted to condominiums or allowed to deteriorate.
"Local governments are doing their part to increase and preserve the supply of rental and affordable housing, but we can't do it alone. We need the federal government to work with municipalities to lower investment barriers to rental housing and keep Canada's economic recovery on-track," said FCM president Karen Leibovici. "Tightening mortgage rules is only half the equation -as home buying slows down, you need to replace the lost construction jobs and you need to give Canadians somewhere else to live."
The report reinforces the findings of FCM's January 2012 report, The Housing Market and Canada's Economic Recovery, which proposed an array of federal tax incentives to stimulate the construction of new rental units and preserve existing rental stock.