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Home ownership for some Canadians continues to be out of reach. Here’s why

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Black people and lone seniors continued to face housing challenges in 2021 despite fewer households living in unaffordable situations, a recent report from Statistics Canada shows.

According to an expert, housing problems remained for some populations because of unaffordable rent, skyrocketing home prices, and the rising costs of living in urban cities like Toronto and Vancouver.

Rising rent costs in cities like Toronto are creating a huge barrier in terms of affording housing,” said Nemoy Lewis, an assistant professor in the School of Urban and Regional Planning at Ryerson University.

Read more: Cooling housing market shows short supply didn’t fuel COVID price surge: BMO economist

Lewis says the StatCan data signals to the fact that not enough is being done to safeguard some of the most vulnerable segments in the population.

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“More needs to be done,” he said, citing the need to get rid of vacancy decontrol and put a cap on rent hikes.

The Advocacy Centre for Tenants Ontario explains on its website that when a unit is vacated there are no limits and the landlord is allowed to charge any new rent that the market will bear. That recently vacated unit can cost the new tenant hundreds of dollars more in rent per month.

It is basically “a lack of regulations that would limit how much landlords are legally allowed to charge for unoccupied units,” the center stated.

Read more: More than $220K income needed to buy a home in Toronto, Vancouver: analysis

According to a housing affordability data from Ratehub.ca, people will need to be making more than $220,000 to buy a home in Toronto and Vancouver with a 20 per cent down payment.

While home prices have been going down in cities like Toronto, Vancouver, Winnipeg, Ottawa and Hamilton, the income required to purchase a home in these markets still remains higher due to stress test rates and rising mortgage rates, the report from Ratehub.ca states.

In a recent Canadian Income Survey released by Statistics Canada in March, the median after-tax income of Canadian families was shown to be $66,800 in 2020, which is in no way enough to afford a home in the country’s major cities.

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Black people least likely to be house owners

Moreover, households led by a Black person were the least likely to be owners at 37.0 per cent, compared with 42.0 per cent in 2018.

Of households led by persons designated as racialized, 62.0 per cent owned their dwelling in 2021, unchanged from 2018, the recent Statistics Canada report stated.

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In 2021, the report also showed that one in five Black-led households reported experiencing economic hardship in the past 12 months, with nearly two-thirds of those identifying COVID-19 as the cause.

Read more: What it’s like to rent as a Black Canadian: ‘I don’t even have a chance’

“One of those continued problems of black-led households is not having the ability to access affordable housing in major urban centers like Toronto, and various other urban centers across the country,” Lewis said.

However, Lewis says he’s not surprised by the data.

Lewis cited a study by the Wellesley Institute, a Toronto-based non-profit research and policy think tank, that showed that in 2020 black renters were twice as likely to experience evictions.

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“It’s because of unaffordable rent, so it didn’t surprise me that they’re more likely to experience economic hardships, which could explain why Black renters are experiencing higher eviction rates for nonpayment for rent,” he said.

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The Statistics Canada report says that more Black renter households (17.1 per cent) identified COVID-19 as the reason for economic hardship than homeowners (11.0 per cent).

Households led by a Black person were among those most affected, with 40.0 per cent reporting economic hardship and three-quarters of those attributing it to COVID-19, the report showed.

Lone senior renters struggling with unaffordable housing

Another group struggling with housing problems are lone seniors. According to the Statistics Canada report, it is more likely for senior renters to be living alone (49 per cent) in unaffordable housing than senior owners (18.8 per cent).

The affordability situation of lone seniors was also worse than that of seniors who lived alone in government-assisted housing, the report showed.

“Seniors continue to face affordability challenges and even displacement problems in cities with high living costs,” Lewis said.

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He explains that rental hikes in provinces like Ontario created significant challenges for seniors who are on a fixed income or on a pension.

“As rents continued to increase, the income of lone seniors remained stagnant…this should beg the question of what are the sacrifices that seniors are making in order to survive in an unaffordable rental market like Toronto?” Lewis said.

He says these people might be making sacrifices with respect to groceries, personal care items or medications that they might need just to afford rent.

What can be done?

Lewis says policymakers need to get rid of vacancy decontrol, which COVID-19 helped bring to the surface as a major issue faced by renters.

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“At the start of COVID, we saw that rents were on a decline, and what was happening is that folks that could have benefited from that were either having the hours at their jobs reduced or have lost their jobs,” he said.

He says people who were facing the biggest economic hardship during the pandemic didn’t have a stable income to provide to a landlord to demonstrate that they are deserving of that particular rental unit.

Read more: Here’s what it takes to buy a home in Canada’s ‘soul-crushing’ housing market

“The folks that benefited from those declining rents were the folks that were upper-middle-class income families that were able to continue to work from home and were able to continue to maintain their same salary,” Lewis said.

He says these groups were able to take advantage of the rent decline instead of the groups who were most vulnerable.

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Lewis says that having vacancy decontrol helps to incentivize landlords to force some of the most vulnerable segments of the population out of their homes in order to attract higher-income renters in those particular units.

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“If the data is showing that some folks are experiencing these economic hardships, then it should also suggest that we need to put safeguards in place to ensure that we’re not allowing rents to spiral out of control and exacerbating the affordability problems that some of these folks face,” he said.

“We also need to ensure we’re not creating income polarized cities and where you can only reside in Toronto if you’re wealthy,” he added.

— with files from The Canadian Press

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