Good morning,
The housing crisis gripping many parts of Canada, especially British Columbia, is a story of changing demographics and failure by governments over decades to foresee the problems that have now been realized. It’s a tale of winners (mostly older, well-off Canadians) and those without the same advantages (including young Canadians and new arrivals.)
It’s also a story about numbers: number of units Canada will be short, based on current building trends, to accommodate the population in 2030 (3.5 million more units will be needed than what is currently in the works, according to Canada Mortgage and Housing); number of housing units promised; number of housing units in the first phase of construction (housing starts); number of units in the planning phase (permits issued).
All the figures can make for numbing storytelling.
But Globe graphics editor Murat Yukselir’s work offers an at-a-glance report card of how each province is doing on housing starts and permits based on the common denominator of per 100,000 population. The simple, interactive thumbnail graphics reveal changes over time as a reader moves their cursor across the picture.
Murat worked with reporter Frances Bula, using data provided by CMHC and by the B.C. and Ontario governments, to explain how and why British Columbia is well ahead of Ontario on housing starts and on issuing building permits. One metric is an indication of where each province is at now in addressing their respective housing crises. The other metric indicates where each of them will likely be within about a year, based on projects in the advanced planning stages.
Mid-year figures released last month by CMHC showed that B.C. housing starts were down eight per cent compared with the previous year. Ontario’s showed a 17-per-cent decrease in starts. Housing starts are defined by CMHC as projects in which the foundation has been poured and the building is emerging from the ground.
A closer look shows that B.C.’s mid-year results are only down relative to last year because last year was a record year. In fact, housing starts for 2024 are still well above the five-year average.
On permits, Frances found that B.C. increased the number of housing units permitted between January to May this year by 15.4 per cent over the same period last year. B.C.’s numbers were double the Canadian increase for that period.
Murat’s comparison shows that for the first two quarters of this year, B.C. issued about 438 building permits per 100,000 population. Ontario issued 279.
Murat’s numbers reveal other interesting trends nationwide.
Alberta had the highest number of housing starts and permits issued among the provinces for the first two quarters of this year, based on Murat’s comparison by population. Quebec, New Brunswick, Nova Scotia and Prince Edward Island all outperformed Ontario in housing starts. Those provinces, as well as Manitoba, also issued more building permits based on population than Ontario did.
Frances notes that British Columbia is pushing to build against the headwinds that are also facing housing development in Ontario: high land costs and the evaporation of offshore investors.
Economists, developers and housing analysts interviewed by The Globe said British Columbia has had a head start on tackling the housing problem, with the province and municipal governments moving earlier than other provinces to incentivize developers to build rentals.
Economist Bryan Yu at Central 1 Credit Union noted that although starts for condo projects are down by 20 per cent in B.C., rental project starts are rising, helped along with incentives from the provincial and federal governments in the form of low-interest financing.
Still, analysts who spoke to Frances worry B.C. will slow down just as Ontario has.
High interest rates, labour costs and construction material prices are structural problems that aren’t going away. Permitting times in city halls haven’t sped up sufficiently, and there is no agreement on a different funding model to build needed infrastructure for new neighbourhoods, meaning developers must pay.
Builders in B.C. are also navigating a host of regulatory changes by the B.C. NDP government that are making investment in new rental construction more risky with stringent rules limiting landlords’ ability to raise rents and a requirement to give tenants three to four months’ notice before evicting them in the event of a building sale.
Recently, it’s not just condo projects that are being put on hold in B.C. Developers of large rental projects are also showing signs of stress, analysts note.
This is the weekly British Columbia newsletter written by B.C. Editor Wendy Cox. If you’re reading this on the web, or it was forwarded to you from someone else, you can sign up for it and all Globe newsletters here.