Tell me if you’ve heard this one before: a nurse, a programmer and an electrician walk into a province. What do they all get?
Ostensibly a job, as promised by last year’s UCP campaign to court skilled workers from Ontario with the promise of greener, more affordable pastures. But Alberta is Calling also led with the prospect of affordable housing, highlighting the drastically cheaper cost of living compared with the sky-high prices in Toronto.
But now more than ever, that promise rings hollow, as newcomers to Alberta find themselves locked out of an increasingly tight housing market and longtime residents get squeezed in ways they thought only Torontonians and Vancouverites could.
Affordable housing is defined as monthly payments of 30 per cent or less of one’s monthly income. This is a metric that is increasingly out of reach for many households. The City of Calgary estimates that 80,000 households in the city cannot afford housing on the market.
Prices surged between 2021 and 2022, peaking at highs of around 77 per cent over 2016 levels for townhouses, and an average of 60 per cent higher across all other housing types. Pent-up demand caused by the pandemic is definitely a factor, but the 2023 elevation in real benchmark prices signals that demand is at a sustained high, as prices soar beyond the rate of inflation despite the market cool in 2022.
The average price of a single-family home has risen 30 per cent since 2016, with apartments and townhouses rising 51 and 44 per cent respectively. For renters, some tenants have experienced hikes of nearly $1,000 per month.
This comes as people are being squeezed across the economy. According to Statistics Canada, the real median after-tax income for people not defined as being in a census family fell by $3,000 in Calgary over the past 11 years. In 2021, 236,000 Calgarians fell into this category. Calgary has experienced fatally low real income growth, with the number of Calgarians classified as low-income — both families with children and otherwise — expected to rise in the coming years.
And this is a city that has, in some respects, rebounded well since the pandemic. The city is expected to flirt with a total of two million inhabitants between now and the early 2030s. Employment rates are almost at pre-pandemic levels and migration to Calgary — both internal and external — has increased by nearly 150 per cent since 2020. The city is expected to grow by more than 100,000 residents over the next five years.
Migrants have answered Alberta’s siren call, and are finding the dream of a more-affordable lifestyle more hollow than promised.
So what is to be done, as the market-based approach to housing deepens the crisis in affordability? It’s encouraging to see council accept the recommendations of the Affordable Housing Task Force for information. The zoning question has, of course, been sticky in Calgary. But the city simply has to adopt new zoning measures to unlock the potential for denser, affordable, multi-family developments that can address the crisis now.
There are other stop-gap measures the city should consider. One would see the province strengthen regulations against investor-owned housing to keep the demands of shareholder-value maximization out of the housing question. Calgary has been identified as a zone of lax control on that front. Alberta has, at 24 per cent, the highest rate of apartment units owned by Real Estate Investment Trusts, according to research published in the Journal of Urban Affairs in 2020.
Alberta also needs rent control, capping rental hikes to a set value that doesn’t push shelter costs to unaffordable highs, so tenants can predictably plan their finances. ACORN has advocated for this, along with a rental registry that catalogues the rental price paid by the previous tenant of every rental in the city.
Every order of government must take action to address the crisis. Publicly funded and maintained housing offers such an opportunity. Since markets cannot be reasonably expected to lower housing prices with supply increases alone, government needs to step in to prevent those higher prices from abolishing Calgary’s ostensible affordability advantage.
More market-based supply simply isn’t enough. We need publicly funded, affordable housing now.
Alexander Shevalier is the president of the Calgary and District Labour Council