Housing Affordability
Housing affordability scorecard
We scored the parties' platforms to see how close they get us to achieving our goal of housing affordability. Download the scorecard and check out the full analysis below!
Table of Contents
UPDATED May 20, 2022 @ 15:33
Introduction
This election, Generation Squeeze is undertaking a rigorous assessment of Ontario provincial party platforms and commitments on four key issues: housing affordability, family affordability, climate change, and overall plans to budget for wellbeing for all generations.
Our mission: to help voters better understand how far each party's platform goes towards actually solving big problems facing Ontarians, and how these problems help prop up a broken generational system.
Instead of simply listing party promises, our assessment attempts to make meaning of these promises. We do this by evaluating the degree to which each platform advances each of the evidence-based actions needed to address key issues sustaining generational unfairness. Please visit our methodology page for more information on our approach to assessing party platforms.
On this page, you will find:
- Summary score table: The housing commitments made by each party in their platform are assigned a score. This score is determined based on the extent to which the actions proposed by the party advance the actions identified in our solutions framework on housing affordability.
- Detailed commentary: In depth discussion of the platform commitments made by each party that informed the scores, as well as the strengths and weaknesses of each commitment.
Gen Squeeze does not tell you who to vote for, and we don’t aim to portray any party in a favourable or unfavorable light. Our goal is to help voters be as informed as possible about the positions of all of the parties on big issues for generational fairness in Ontario. Please visit our methodology page for more information on our approach to platform analysis and our commitments to be non-partisan and evidence based.
Punchlines
The study investigates two questions: First, is any party promising enough to end the housing affordability crisis? Second, which platform aligns more with the evidence about what is required to restore affordability? The new, comprehensive analysis digs into the strengths and weaknesses in all four party platforms to answer both questions.
Findings:
No party is proposing to do enough to restore housing affordability for all.
Generation Squeeze worked over the past several years with academic and community experts to produce a comprehensive policy framework to fix the housing system. The framework points to 15 different action items. None of the Party platforms address all 15. As a result, there is reason to remain concerned that a very large gap between housing costs and local earnings will persist – for renters and aspiring owners. This is especially concerning given that Ontario has just suffered the worst erosion of housing affordability of any province at any time in the last half century.
Some platforms align more with the evidence than others
- The NDP and Greens promise two-thirds of the action items.
- The Liberals promise to address one-half.
- The Conservatives promise one-quarter
A key challenge
None of the parties propose to restore affordability for all by adapting policies so home prices will stall in order to give earnings a chance to catch up. As a result, all parties offer platforms that risk remaining culturally and politically addicted to high and rising home prices. This means parties consistently say too little about the need to:
- grow Ontario prosperity without relying on economic growth predominantly in real estate, which drives GDP by growing the major cost of living – housing – without producing much employment so that earnings for most Ontarians keep pace;
- reduce the home ownership tax shelter that incentivizes Ontarians to bank on high and rising home prices; or
- call on Statistics Canada to fix weaknesses in how it measures housing inflation, which contributes to monetary policy that inflicts collateral damage on housing affordability.
What separates the parties?
Not a commitment to get new homes built! All parties promise to support developers to build 1.5 million more homes. But the NDP, Greens and Liberal platforms are stronger than the Conservative platform in committing to support developers to build more purpose-built rentals, units with enough bedrooms to raise kids, and units that are energy efficient in support of climate change mitigation goals.
Renewing existing not-for-profit housing, and building more: The NDP, Greens and Liberals are all relatively strong on this issue, embracing recommendations made by the Ontario Non-Profit Housing Association. By contrast, the Conservative platform says very little, and allocates limited funding, for “non-profit” or “not-for-profit” housing.
Dialing up protection for renters: The NDP, Greens and Liberals all promise to strengthen rent controls, and discourage renovictions. The NDP and Greens support vacancy control, whereas the Liberals worry that vacancy control will deter development of enough new purpose-built rental units. The Conservative platform stands out for giving little focus to the issue of protection for renters, nor how to balance such protection with strategies to incentivize developers to build more purpose-built rental homes.
Dialing down obvious examples of harmful demand: Policy dialogue has matured in Ontario to the degree that it is now pretty common for political parties to commit to efforts to crack down on money laundering, implement a beneficial ownership registry, tax vacant homes, implement an anti-flipping tax, end “blind-bidding” to reduce the risk of some problematic real estate practices, create a province-wide short-term rental registry, and discourage non-residents from speculating in the Ontario housing market.
The Greens propose to do all of these things, followed closely by the NDPs and Liberals who propose all but one in the list. By contrast, the Conservatives only prioritize addressing about half of these commonly identified examples of ‘harmful demand.’
Approach to Platform Analysis
For the Ontario election, we focus our analysis on the three parties that elect representatives to fill the majority of the seats in the provincial legislature: the Conservative Party, the New Democratic Party, and the Liberal Party. We also include parties that elected at least one MPP who ran in the last election under the banner of that party. This means that our analysis includes the Ontario Green Party. We do not include parties with no representatives elected specifically as members of that party.
Our assessment of party commitments on housing affordability is based on our Housing Affordability Framework. This framework draws on the work of the Balanced Supply of Housing University-Community Partnership, the Gen Squeeze led Housing "Solutions Lab", and on the findings of Gen Squeeze's "Building Housing Common Ground" session and report. Read more about our framework design here.
To support the analysis of party platforms, we've translated our housing policy framework into 15 key criteria. Parties are assigned points based on their platform's response to each of these criteria. Score range from +1.0 to -1.0, assessed as follows:
Assessment |
Points |
|---|---|
|
No discernible commitments |
0 |
|
Commitments are somewhat capable of achieving the goal |
0.5 |
|
Commitments are capable of achieving the goal |
1.0 |
|
Commitments somewhat undermine progress towards the goal |
-0.5 |
|
Commitments undermine progress towards the goal |
-1.0 |
You can learn more about the rationale for our scoring approach and its limitations by reading our detailed methodology page.
Summary score table
The table below summarizes the scores of Conservative, NDP, Liberal and Green party on each of the 15 housing affordability criteria.
We welcome feedback from parties, including concerns that we may have misinterpreted elements of their platforms when assigning our scores. We commit to revising our scores in light of party evidence that their platforms or other election documents include commitments that align with the evaluation criteria.
Note for mobile/smartphone device users: The table below may not display properly on your smartphone screen. If the table appears to be cut-off, please return to this page on a desktop/laptop computer. We apologize for the inconvenience.
Detailed commentary
CLEAR GOALS AND PRINCIPLES
Criterion 1: Do the platforms embrace the goal that all Ontarians should be able to afford a good home by 2030?
In the National Housing Strategy, the arms-length Canada Mortgage and Housing Corporation commits to the goal that “By 2030, everyone in Canada has a home that they can afford and that meets their needs." Gen Squeeze has put this goal at the centre of our housing solutions framework. We believe parties should adopt this, or a similarly clear and ambitious goal.
The NDP refers specifically to this CMHC goal in its housing promises (p. 17), stating that “Ontario must do much more if this necessary goal is ever going to be achieved.” The party adds on page 6 of its full platform that “We’ll work hard to ensure every Ontarian has a decent, affordable place to live, wherever you live, whether you’re renting or buying.” For these reasons, we award a full point.
The Conservatives and Greens receive a half point for this criterion. Each of these parties commits to the goal that “all” residents or “everyone” should be able to afford a home that meets their needs.
Page 94 of the Conservative government’s 2022 budget says “Everyone in Ontario deserves to find housing that is right for them.” Page 30 of the Green platform promises a strategy to “mak[e] sure everyone has a safe, affordable and accessible place to call home.”
Neither the Conservatives nor the Greens provide a timeline by which to achieve this goal. By contrast, they both refer to 2030 as the timeline by which to achieve carbon reduction objectives. Since the Conservatives and Greens recognize that committing to timelines matters for some pressing intergenerational issues, the absence of timelines for housing promises is conspicuous.
The Liberals score zero points for this criterion. There is no language in the Liberal platform that promises “all” or “every” resident(s) should be able to afford a home that meets their needs. Nor does the platform commit to meet this goal by 2030. Like the other parties, the Liberal platform references 2030 as the timeline by which to achieve many climate mitigation objectives – so once again, the absence of a timeline for achieving a bold goal for housing affordability is concerning.
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Criterion 2: Do the platforms commit to the principle that housing is a human right?
One of the basic human rights is the right to adequate housing and shelter, recognized in the Universal Declaration of Human Rights, the International Covenant on Economic, Social and Cultural Rights, and in Canada’s own legislated National Housing Strategy.
The NDP, Liberal and Green parties receive a full point for this criterion. Page 76 of the NDP platform reads that “Access to a safe, affordable, and supportive place to live is a basic right.” Page 19 of the Liberal platform reads “We’ll work to establish housing as a fundamental human right in Ontario and provide people with safe and reliable shelter.” The Greens (p. 37 of their housing policy announcement) explain we “believe that everyone has a right to safe and affordable housing. It’s important that housing is not only treated as a commodity to buy and sell. Housing is a place for people and families to live.”
The Conservative Party earns a zero for this criterion. Its 2022 Budget refers to workers’ rights and rights to protest, but it does not embrace the language of a rights-based approach to housing.
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Criterion 3: Do the platforms commit to the principle that our housing system should make room for everyone?
This criterion reflects the principle that housing policy should be created with the intent of welcoming a diversity of people, incomes, quality housing forms, and tenures into all of our neighbourhoods and communities. This principle discourages NIMBY’ism (Not In MY Back Yard).
The Green Party earns a full point for this criterion. While the Greens don’t specifically refer to overcoming NIMBY’ism, page 34 of its full platform does promise to “encourage municipalities to meaningfully engage with prospective residents, not only current residents, when consulting on zoning changes and new developments to ensure all voices are heard during the planning process.” Page 40 articulates a commitment “to mandating universal design to ensure that all new housing is accessible for all and suitable for aging in place.” Page 31 promises to “mandate inclusionary zoning and require a minimum of 20% affordable units in all housing projects above a certain size.”
The Liberal party platform also does not point directly to combatting NIMBY’ism. However, pages 12-19 do refer often to “inclusionary zoning,” encouraging “the development of low-rise ‘missing middle’ multiplexes and other mid-rise housing options”, and aims to “make it easier for existing rental housing providers to add new rental suites.” As part of their efforts to end “exclusionary zoning policies,” the Liberals add (p. 16) “we'll make it easier to find out about and participate in community consultations and require municipalities to reach out to equity-deserving groups, advertise meetings on social media, provide accessible online options to participate and prioritize meeting times outside of regular working hours.” For these reasons, we award a full point.
The NDP platform doesn’t refer to NIMBY’ism, but does commit (p. 8) to “end exclusionary zoning” and “updating zoning rules to enable the construction of more affordable ‘missing middle’ housing, like duplexes, triplexes and townhomes.” The NDP discussion of exclusionary zoning also aims to distribute “an adequate supply of different housing options that are affordable, meet the diverse needs of different families, and are located where people want to live.” For this reason, we award a full point for this criterion.
The Conservative government’s 2022 budget features (p. 94) language to “Make homes for everyone,” referring to a more comprehensive policy announcement by the same name in March 2022. Both documents promise “policies and tools that support… missing middle housing” (Budget, p. 94). Like the other party platforms, the Conservative party doesn’t specifically refer to the value of overcoming NIMBY’ism. Unlike the other parties, the Conservative plan doesn’t refer to inclusionary zoning, nor does it make any mention of integrating rental and co-op housing in Ontario neighbourhoods. However, in light of the central importance that the Conservatives give to making “homes for everyone,” we award half a point.
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Criterion 4: Do the platforms demonstrate a commitment to the principle of Homes First, Investments Second?
Homes First, Investments Second means treating housing and residential land as a place to call home, not a way to get rich. The bottom line is that we cannot make housing more affordable while at the same time encouraging home values to increase (faster than local earnings) – which is what people want when they make an ‘investment’. Policymakers need to prioritize housing for homes first, investments second.
The NDP earn a full point for this criterion. Page 4 of their “Homes You Can Afford” supplementary platform document emphasizes that “housing is a human right, not an investment commodity.”
The Liberals also earn a full point. Page 7 of their platform promises to “tackl[e] the housing affordability crisis by prioritizing the people living in those homes – not developers or investors.”
The Greens earn a full point. A range of statements in their full housing document promise to "address speculation to put homes for people first."
Neither the Conservative government’s 2022 budget, nor its “Make homes for everyone” policy announcement, refers to housing being for “Homes First, Investments Second.” The documents don’t mention ‘commodification’ or ‘financialization’ of housing. Searches for the term ‘investment’ in these documents yields many references to specific Conservative housing investments – but little mention of the risks that result when Ontarians treat housing as an investment strategy more than a place to call home. Page 97 of the Budget does indicate that “Priority for Ontario housing should be given to Ontario homebuyers and families, not foreign speculators.” Had they referred to a broader range of speculators, and not just those abroad, we would have awarded a full point. For now, we award half a point.
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Criterion 5: Do the platforms embrace the logic that: to restore affordability for all, we need home prices minimally to stall, so earnings can catch up?
The widening gap between home prices and local earnings necessitates that home prices at least stall – or maybe fall – since restoring affordability means that a good home (whether in rental, co-op or ownership) needs to be in reach of what hard work can earn.
All 4 parties earn zero points for this criterion. Not one makes any mention of the need for home prices to stall so earnings can catch up. This is a fundamental failure on the part of all of Ontario’s political leaders – and a key reason to worry that none of the parties are up to the task of fixing Ontario’s dysfunctional housing system.
The absence of any political discourse during this election about the need for home prices to stall reflects the power of homeowner perspectives in electoral politics. The unspoken flip side of crushing unaffordability for younger and future generations is that rising home values make homeowners richer. The prospect of gaining wealth while you sleep and watch TV is a powerful incentive to look the other way while home prices continue to rise – even when Ontario just suffered the most rapid erosion of affordability – and rapid growth in housing wealth – of any province at any time in the last half century. Ontario’s housing system has never worked worse for protecting affordability… but it’s also never worked better for producing wealth for homeowners. See Gen Squeeze’s recently released report for more information.
Yes, the NDP and Liberals both indicate that their platforms aim to “cool” the housing market. However, we judge that this language is not sufficient to earn even partial points. We are looking for clear signals that parties aim to reorganize policy so that home prices minimally stall for years to come to give earnings a real chance to catch up. We expect parties to resist describing the housing market as “strong” or “healthy” when home prices rise. The housing market may be “strong” at producing wealth windfalls for owners when home prices rise. But the housing market is “strong” at producing affordability when home prices stall (or fall).
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SCALE UP NON-MARKET HOUSING
Criterion 6: Do the platforms protect and upgrade existing non-market homes?
This criterion includes investments in necessary repairs to existing housing, as well as accessibility and climate upgrades.
The NDP plans to establish a new public agency, “Housing Ontario,” to finance, build and protect existing affordable housing supply. Page 18 of “Homes You Can Afford” states that “We’ll extend the lifespan of 260,000 affordable homes.” Guided by estimates from the Ontario Non-Profit Housing Association, the NDP platform explains that “The cost of replacing Ontario’s community housing units is an estimated $65 billion. Instead, $2.6 billion in spending will ensure capital repairs to these homes, so they stay safe and efficient for years to come. An NDP government will contribute 40 per cent to these capital repairs, to be matched by the federal government, with the remaining 20 per cent split between municipalities and contributions from community housing providers.” We award a full point.
Guided by the same Ontario Non-Profit Housing Association estimate of the number of non-market homes in need of repair, the Green party promises to “Restore 260,000 existing community housing units over the next decade,” allocating identical amounts to the NDP – $104 million a year over the next many years. The Green Party receives a full point.
Page 13 of the Liberal platform promises to “retain and repair tens of thousands of existing affordable homes.” Page 2 of their platform costing promises dollars that are on par with the NDP and Greens to “preserve and repair $260,000 existing social and community housing units by investing a net $1[billion] over 10 years.” We award a full point.
Page 96 of the 2022 Conservative budget indicates that “through the Community Housing Renewal Strategy and the government’s response to COVID-19, Ontario has invested more than $3 billion between 2020 and 2022 to support community housing and help to prevent homelessness.” It adds that the “government has also introduced a new regulatory framework under the community Housing Renewal Strategy to make the system more sustainable over the long term.” However, Conservative documentation is short on details about the scale of future investments to carry on this important work, and also doesn’t reference cost estimates identified by the Ontario Non-Profit Housing Association. The Conservative platform receives only half a point.
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Criterion 7: Do the platforms create new non-market homes?
This criterion includes the entire spectrum of non-market housing – shelters, transitional and social housing – plus a range of rental and ownership options for low and middle income earners. Actions to expand non-market housing can include purpose built construction, donated lands, providing loans and capital, adopting inclusionary zoning, and incentives or programs to convert existing market housing to non-market tenure.
The Greens, NDP and Liberals have similar platform commitments on building new non-market housing. All promise tens of thousands of new social and community housing units. All promise tens of thousands of additional supportive and assisted living housing units for Ontarians with mental health, addictions, or other support needs.
It is difficult to compare the platforms with a lot of a certainty due to challenges interpreting when and how they account for capital investments versus operating costs. The Greens appear to be investing more in total than the Liberals and NDP. The Liberals appear stronger at investing in operating supports for non-market housing by comparison with the NDP, but the total number of new non-market units that the NDP promise appears to be greater than the Liberals.
All three parties are promising modest funds for co-op housing. The NDP also offers modest funds for a Land Trust.
Altogether, we judge that each of the Greens, NDP and Liberal is committing to make important, incremental progress to achieve this criterion. We award each party half a point.
The Conservative Party stands apart from the other three parties for having little to say about future investments in community housing. Their 2022 budget doesn’t use the terms ‘non-profit’ or ‘non-market’ housing. The budget is also light on details about investments to build new community or social housing, beyond what the Conservative suggest they have already allocated. For this reason, we award no points for this criterion.
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Criterion 8: Do the platforms create new strategies to serve the most vulnerable?
Specific housing options may be required to adequately meet the needs of some groups who are socially and/or economically marginalized. This criterion includes housing for people who are homeless or at-risk of homelessness, shelter options for women and families escaping violence, and supportive housing for those with mental health or addictions issues. Also included in this criterion is housing for Indigenous people in Ontario.
All of the parties include some commitments to supporting the most vulnerable, including those who are homeless, or those harmed by the ongoing legacy of colonialism.
We award the Conservatives and Liberals a half point. Each party proposes investments that will make some progress towards meeting the unique housing needs of vulnerable groups, such as emphasizing the language of “Housing First” approaches to support people with a range of complex mental health, addiction and other struggles that are often the result of various systemic inequalities in society. But by comparison with the Greens and NDP, the impact of Conservative and Liberal party proposals is likely to be qualitatively different, and more modest.
Interestingly, what earns the Greens and NDP this more favourable assessment is NOT a policy listed in their housing literature – it is their promises to fix Ontario’s social safety net. This is important for housing, as recipients of disability or social assistance benefits pay for their housing costs out of the income support they receive through these programs.
The Greens have been out front on this issue, leading public dialogue in Ontario to double the value of social assistance and disability benefits. But both the Greens and NDP propose to inject an extra $6 billion annually to double the benefits paid by the Ontario Disability Support Program; and an extra $3 billion annually to double the benefits paid by Ontario Works. The Liberals and Conservative don’t propose changes with the same order of magnitude.
The investments proposed first by the Ontario Greens – and taken up by the NDP – would provide positive leadership in Canada that hopefully other provinces might follow. We award a full point to the Greens and NDP for this distinctively different housing-related commitment.
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FIX THE REGULAR MARKET
Criterion 9: Do the platforms include action to dial down the most obvious examples of “harmful demand”?
This criterion includes harmful demand from what Gen Squeeze often refers to as the ‘easy villains’ in the housing market – money launderers, speculators, foreign buyers, tax cheats, house flippers, shady real estate agents, and short-term rental operators.
Policy dialogue has matured in Ontario to the degree that it is now pretty common for political parties to commit to efforts to address many of the most obvious examples of ‘harmful demand’.
The Green party aims to “crack down on money laundering,” implement “a beneficial ownership registry,” create “a province-wide vacant homes tax,” “implement an anti-flipping tax on quick turn around sales,” in addition to ensuring fair taxation of condo presales, end “blind-bidding” to reduce the risk of some problematic real estate practices, “create a province-wide short-term rental registry,” and “expand the non-resident speculation tax.” This represents a comprehensive list of policy recommendations to dial down the most obvious examples of harmful demand. We award a full point.
The NDP and Liberals are also strong on this criterion. The NDP plan to “crack down on money laundering,” “end hidden ownership,” “introduce an annual speculation and vacancy tax,” “track and tax pre-construction condo flipping,” “regulate short term rentals.” If the NDP plan is missing anything, it is about discouraging house flipping more generally, and efforts to reduce shady real estate agent practices. Still, the list of promises is strong enough to warrant a full point.
Similarly, the Liberal platform promises to “combat money laundering,” “ban new non-resident ownership,” “ensure condo flippers pay appropriate taxes,” “create a publicly accessible beneficial homeownership registry which will help crack down on bad actors,” “introduce a ‘use it or lose it’ tax on developers sitting on land ready for development, implement a “bill of rights” for prospective buyers to be protected from shady real estate practices. While the platform doesn’t have an obvious mention of the need to better regulate short-term rentals, this list of plans to address obvious examples of harmful demand is relatively comprehensive. We therefore award a full point.
The Conservative 2022 Budget promises to increase the non-resident speculation tax rate to match what exists in BC. It promises to support municipalities to adopt vacant home taxes – something that Gen Squeeze has been urging in Ontario since 2016. The Conservatives commit to “cracking down on unethical developers,” and cutting “red tape” that often permits NIMBYs to resist adding density and rental housing to neighbourhoods that privilege single-detached homes. However, our search for other important measures to dial down harmful demand turned up short. Neither the Conservative budget nor the More Homes for Everyone policy announcement proposes to crack down on money launderers, house-flippers, shady real estate practices, corporate hiding of beneficial ownership, or the tendency for homes to be taken off the market for locals in order to cater to vacationers as short-term rentals. Accordingly, we award only half a point for this criterion.
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Criterion 10: Do the platforms include action to dial up, and upgrade, the right kind of supply in the regular market?
This criterion includes efforts to increase housing supply in ways that combat sprawl, and encourage density and mixed-use in urban land already reserved for residences (protecting land required for industry, farming and green-space). It also includes an emphasis on protecting and stabilizing the existing supply of affordable homes by adding so-called ‘missing middle’ housing, family-sized units, and purpose-built rental; and efforts to incorporate low/zero-emission goals into supply-side housing policy.
There is consensus among the four parties that Ontario needs to build more homes as a key part of the strategy to restore affordability, and to get these homes built at a faster rate than ever before. All parties have adopted the target of developers building 1.5 million more homes over the next decade, as proposed by the Housing Affordability Task Force appointed by the Conservative government. All four parties also propose prioritizing ‘missing middle’ housing, and changing zoning policies to support municipalities to approve such projects as efficiently as possible. Each party also focuses on adding density on land already zoned for residences, transportation or industry in order preserve land in the greenbelt – although protecting the greenbelt, wetlands and farmland is a particularly strong focus of the Greens.
The Conservative party is banking on growing the supply of housing to restore affordability more than relying on other housing policy tools, emphasizing cutting “red tape” and accelerating municipal decision to get more built. However, neither the Conservative 2022 budget, nor its earlier More Homes for Everyone policy announcement, mentions purpose-built rental housing as part of the kinds of homes to be built. This is an important weakness. Another weakness is the Conservative lack of attention to the importance of building new homes with enough bedrooms to raise kids. Finally, the Conservative party has little to say about opportunities to fight housing unaffordability AND climate change simultaneously by ensuring that newly built homes meet energy efficiency and renewable energy goals. For the above reasons, we award half a point to the Conservatives for this criterion.
By comparison with the Conservative platform, the NDP platform has a strong focus on building “purpose-built rental” homes, that are “energy efficient,” and with “family-friendly options” integrated into missing-middle housing throughout neighbourhoods. We award a full point.
The Green party platform (p. 30) observes “We urgently need to build more well-designed, affordable, purpose-built rental housing;” and they propose to “Amend the Building Code, so all new commercial and residential buildings are built with the lowest carbon footprint possible and net zero by 2028.” On page 10 of its housing policy, the Green party also specifically refers to working with municipalities to prioritize building “homes with multiple bedrooms to allow for growing families.” For these reasons, we award a full point.
The Liberal platform offers a lot of detail about how it will change zoning to accelerate the addition of missing middle housing for families, and has a strong emphasis on purpose-built rental housing. Like the Greens, the Liberals propose (p. 63) to “update the Ontario Building Code so all new buildings and renovations are built to leading energy-efficiency and climate resiliency standards by 2025.” We award a full point.
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Criterion 11: Do the platforms dial up protections for renters?
This criterion includes protecting existing affordable rental units as more rental units are built, mandating rental building replacement upon redevelopment, and tenant protection and assistance policies – balanced with landlord and developer needs. Protecting rental options is growing in importance in Ontario, and across Canada, as rising home prices push home ownership out of reach for many younger people, newcomers of any age, and the 20% of seniors who are renters.
The Conservative party stands out for taking limited action on this criterion, which is a key part of a comprehensive plan to restore housing affordability. In addition to weakening rent controls during its first mandate, the 2022 Conservative budget makes no mention of risks of renoviction or demoviction – and includes no plans to mitigate the resulting harms for renters. Other than a modest investment ($19.2 million) to increase the capacity of the Ontario Land Tribunal and Landlord and Tenant Board to resolve cases faster, the Conservatives give little attention to how best to balance concerns about renoviction and demoviction with the interests of developers and operators needing to repair older buildings – or who hope to add more rental units on existing properties. For these reasons, we award no points to the Conservatives.
The NDP and Green parties both promise to restore rent control for all rental buildings, and limit the degree to which tenant turnover results in rising rents (aka vacancy decontrol). There is a strong focus in both platforms on discouraging renovictions, as well as funding to enhance the capacity of the Landlord and Tenant Board. These commitments are generally in line with the kinds of tenant protection and assistance policies that renter advocacy organizations often emphasize – although those groups will ultimately seek more specificity about what the proposed renter protections entail.
We award both the NDP and Green parties a full point. However, we also encourage both parties to design renter protection policies with due care, to continue to incentivize developers to build more purpose-built rental housing. Strong policy must balance the need to protect existing renters with the need to incentivize construction of new units for those currently struggling to find affordable rentals.
The Liberal Party emphasizes its commitment to “bring back rent control” (p. 12). It also combats renovictions by means of a $15 million investment to clear the backlog in the landlord tenant board that deals with allegations of illegal renovictions (p. 16). While monitoring the ways in which landlords may use tenant turnover to raise rents, the Liberal party implies concern that vacancy control will deter development of enough new purpose-built rental units. This means that the Liberals offer an alternate route to managing the balancing act that we identify above for the NDP and Greens. Managing this balancing act is a judgement call, and reasonable people will disagree about what is the best judgement. With this analysis, we identify the difference between the three parties, and award the Liberals, along with the Greens and NDP, a full point for the criterion.
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BREAK THE ADDICTION TO HIGH HOME VALUES
Why? Because unless Canadians’ incomes drastically increase, it will be extremely difficult to achieve and maintain the goal (everyone able to afford a home that meets their needs) in a context of high and rising home values.
The problem is that past and current policy has encouraged treating home and land ownership as an investment and retirement strategy, with many households now expecting or depending on home value increases for their financial security and wealth.
Canada’s overall economy is also problematically dependent on ever-rising home values and the additional consumer spending, GDP increases, and investment returns this creates.
Altogether, Canada has become addicted to an unsustainable housing system, and we need to figure out ways to break this addiction.
This can include government strategies that prioritize growing economic prosperity without relying on growth in real estate. It also can include policy that helps Canadians gain wealth outside of homeownership, rebalances taxation of income vs. real estate windfalls, and protects households which would be made vulnerable if home prices drop.
Criterion 12: Do the platforms propose to reduce reliance on real estate to drive economic growth?
Real estate, rental and leasing represents the largest contributor to Canada’s Gross Domestic Product (GDP) at 14%. This industrial sector is bigger than manufacturing; bigger than mining, oil and gas; bigger than construction; bigger than health care; bigger than financial services; bigger than professional, scientific and technical services; and so on. Real estate has also grown as a share of GDP in all provinces over the last two decades, and often has been the fastest growing part of provincial economies.
Anchoring our economic growth on real estate would be a fine economic strategy – if Canada was also generating a large portion of its employment in this same industrial sector. But we don’t. Canadians find less than 2% of employment in the real estate sector. No other industrial sector has such a big gap between its share of GDP and its share of employment.
This is a problem. It signals that Canadians have been growing our economy by increasing the major cost of living, and without generating jobs in that industrial sector in numbers sufficient to ensure that local earnings keep pace, especially in urban centres. The 2% who find employment in real estate generally attract high incomes. Existing property owners, gain housing wealth, which will propel our spending and consumption, and drive up GDP. It’s one way to grow an economy – but it’s not a good way if we prioritize hard work paying off for younger people and newcomers to Canada. Paying off in terms of generating earnings that can cover their primary cost of living – housing.
None of the four parties make explicit that they prioritize growing economic prosperity without relying on growth in real estate. For this reason, we award no points to any of the parties for this criterion.
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Criterion 13: Do the platforms support increasing housing wealth taxes and lower income taxes?
One key reason Canada is addicted to high home values is our relatively low taxation of residential property wealth. In the context of runaway prices, the home ownership tax shelter inflates demand and average costs, contributes to inequalities and unaffordability, and makes homeowners increasingly dependent on high and rising values. Canadians need a tax shift. This means that our political parties should commit to raising taxes on housing wealth, which will allow us to depend less on income taxes –especially income taxes on lower and middle-earners, and renters.
In criterion 9, we already gave parties credit for their efforts to change tax policy in order to discourage various kinds of harmful demand. Several parties propose taxes on empty homes, unused land, house flipping, non-resident speculators, etc. See that criterion for our analyses of these policy ideas in the platforms.
For criterion 13, we search for evidence of a broader shift to generally tax housing wealth more, in order to create new opportunities to tax income less, especially for middle and lower earners.
The NDP platform stands out in this area for an important step forward, and a partial step back. On page 13 of its housing policy, the NDP promises to “work with municipalities to enable progressive residential property taxes, letting them shift more of the tax burden onto properties worth more than $2 million.” This proposal is a step toward the Gen Squeeze proposal to add a modest price on housing inequity by introducing a progressive (deferrable) annual surtax on home value above $1 million. Note, however, that we recommend that the surtax be implemented at the provincial or federal level so as to avoid inefficient variation between regions or communities within provinces. Still, we award a full point to the NDP for this policy recommendation.
We also subtract half a point from the NDP for this criterion because the party proposes (p. 2 of its costed platform) to “tax the richest 1% by raising capital gains that are included in taxable income from 50% to 100% on corporations (excluding small businesses), and individuals with net worth over $3 million. This new capital gains adjustment includes a primary residence exemption” (emphasis added). The proposal to tax more capital gains is an important example of taxing wealth more. However, exempting wealth held in principal residences further incentivizes Ontarians to treat their principal residence as an investment. Why shouldn’t wealth in a principal residence be counted in overall wealth – especially for those with housing wealth above $3 million? Housing is the most common kind of wealth that Ontarians hold. The net value held in principal residence in Ontario increased by over $1 trillion dollars (after inflation) since 1977. 68% of that wealth went to home owners over age 55, while only 11% went to those under age 45. Ignoring the generational wealth inequalities caused by the rapid escalation in home prices exacerbates intergenerational tensions and inequities.
In total, the NDP earns half a point for this criterion: a full point for promoting additional progressive taxation on home value above $2 million, minus half a point for reinforcing and expanding the home ownership tax shelter.
The Green Party (p. 32) proposes to “implement a multiple property speculation tax on people and corporations who own more than two houses or condominium units in Ontario. The tax will begin at 20% on the third home and increase with each additional property owned” – and its costed platform (p. 6) suggests the rate will rise as high as 30%. We require further information to understand this commitment, but acknowledge that this proposal signals that the Greens aim to tax housing wealth more for those owning multiple homes.
In addition, the costed platform of the Greens (p. 6) promises to “work with the Federal government to implement a wealth Tax, 1% over $10M, 2% over $50M, 3% over $100M over 3 years.” We struggled to find more information about this proposal in Green platform materials (and welcome the party drawing our attention to where we can find it). In particular, we are unclear whether the proposal would include one’s principal residence in the calculation of wealth. If so, then this proposal would also represent an incremental step toward the tax shift recommended by Gen Squeeze. For these reasons, we award the Greens half a point for this criterion.
The Liberal party receives no point for this criterion. The party does propose to tax more those who are very high earners with incomes above $500,000, but this proposal continues to focus on taxing income, not wealth – even though research shows that it is returns to capital/wealth that are driving inequality in Canada, and across the globe. Housing is the most common kind of capital that Ontarians own. But the Liberal platform does not propose adding progressivity to the taxation of home value above $1 million, or other policy strategies that could reduce the home ownership tax shelter.
The Conservative party also receives no point for this criterion. Its 2022 budget does not once mention the word ‘wealth’.
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Criterion 14: Do the platforms propose to reduce the collateral damage from the cheap credit system?
Statistics Canada underestimates the contribution of rising home prices to inflation. The Bank of Canada uses this (inaccurate) inflation signal to guide decisions on interest rates – keeping them at historic low levels because inflation is reported to be modest. Low interest rates decrease the cost of taking on a larger mortgage. Buyers who are able to borrow more bid up home prices. Rising prices aren’t adequately captured by Statistics Canada in inflation data… and there’s your feedback loop, sustaining the cheap credit system and growing the gap between home prices and earnings.
None of the four parties earns points for this criterion. This is a surprise, since it would not cost their governments any money to call on Statistics Canada to remedy how its calculation of inflation presently does not include what’s actually happening to the average price of housing.
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Criterion 15: Do the platforms cushion the impact of a price drop?
Unless the earnings of Ontarians dramatically increase (which is unlikely), the only way to close the affordability gap is to stall housing prices – while simultaneously mitigating the risks this may create for highly leveraged households and the Canadian economy more generally.
Since none of the parties has stated explicitly that restoring affordability for all requires home prices to stall to give earnings a chance to catch up, it’s unsurprising that no party is strong at talking about cushioning the impact of a price drop. We award no points.
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