Fix Housing 6: Stop Homelessness from Growing With These 3 Actions

We seem to be forgetting that homelessness is part of the housing affordability continuum.

This is the sixth in a series of common sense solutions for achieving housing affordability for all.

1.5m Canadian Households are Living on the Edge

Have you seen a tent pop up recently in a local park?

There’s a good chance that could be someone who, until very recently, had a place of their own to live. Someone who was in “core housing need” and just fell off a cliff.

What is core housing need?

• Technically, it’s a household that spends more than 30% of their pre-tax income on housing, or is living in below-standard housing for their family needs.

• Practically, it’s a household that is a paycheque or two away from losing their home or getting evicted. 

In other words, families and individuals who are dangerously close to falling into homelessness.

The Housing Assessment Resource Tool (HART) out of the University of British Columbia shows the extent of core housing need and tells us what level of affordability is actually needed for households with the lowest incomes to attain and retain housing. (Credit here to our good friend Carolyn Whitzman for her work in developing the HART.)

Across Canada, there are 1.5 million households in core housing need. In the City of Ottawa, it’s about 45,000 households. The HART Housing Needs Assessment tool can quickly pull up the number for your city.

To Address Homelessness, First Stop it From Growing

It is possible to functionally end chronic homelessness. We will be talking more about how in the weeks to come.

But the first step in ending homelessness is to prevent the problem from growing. All those living in core housing need – how do we prevent them from slipping into homelessness?

Through action on three fronts.

1. Preserve existing affordable housing through acquisition funds and land trusts

You may know that the bulk of affordable housing in Canada was built before the 1990s. Private sector builders, who supply around 95% of Canadian housing, had an incentive to build market-affordable private rental housing given federal government incentives at the time. 

As it ages, much of that housing stock ends up on the resale market. Unfortunately, all too often, it gets acquired, renovated and relisted as high-end rentals that many households cannot afford. 

For each affordable community (or social) housing unit we build in Canada, we lose about 15 private market affordable units through redevelopment and re-pricing.

We can slow down the loss of affordable housing by creating acquisition funds and land trusts. 

An acquisition fund is a government-supported pot of money to buy aging rental properties, and preserve them as affordable units. (For anyone looking to do a deeper dive, read this HART paper on acquisition funds.)

With access to an acquisition fund, non-profit housing organizations would be able to purchase many of these properties and keep them affordable into the future by removing the profit margin and ensuring that they are kept in good condition.

A land trust is a specific type of acquisition fund. It is typically a not-for-profit organization, capitalized with public money, that acquires affordable properties as they come on the market, and keeps these units in perpetuity as affordable properties. Governments at all levels should be funding land trusts to keep the community housing stock from deteriorating.

2. Provide housing allowance to keep families and individuals in their existing homes

The wait for affordable community housing has grown to 14 years in Toronto. It is 6 years in Montreal. Other cities aren’t as transparent, but wait times like this for housing geared to income are common throughout the country.

Given these wait times, for low and moderate income households on the edge, often the best short-term solution is to provide a housing allowance. This allowance, typically around $500 a month, is designed to keep them in their existing homes and our of shelters.

While housing allowances come with a significant price tag, cities provide them in recognition that the alternative – homelessness – costs everyone a lot more. Estimates published in 2017 are that Canadian taxpayers spend about $53,000 a year per person experiencing homelessness – through the costs associated with providing shelter, health and legal services. A $6,000 annual housing allowance suddenly seems like a bargain.

3. Rapidly rehouse those who fall into homelessness

Falling into homelessness can quickly lead to a downward spiral. Homelessness makes managing health issues and keeping a job much harder. The best thing we can do for those experiencing homelessness is to get them back into stable housing as quickly as possible.

While each municipality has their own approach to rehousing, the practice of the City of Ottawa illustrates how many municipalities could do better. In Ottawa, an individual or family that slips into homelessness is managed through the emergency shelter system. They can join the waitlist for affordable housing, but will often sit on that waitlist for years.

Once they are considered chronically homeless, i.e., homeless for more than 180 days, a whole other system of support kicks in, with a case worker helping to find permanent housing. But that six months can be too long for many to keep their head above water.

We need to redesign our programs to catch people falling into homelessness and quickly get them back into stable housing. But rapid rehousing assumes there is available affordable housing.

Not a replacement for building new affordable units

That’s currently not the case. It is why we have previously talked about how Canada should work to add a million community housing units by 2030.  

And how federal and provincial governments can build and own community housing at a low fiscal cost – i.e, with little impact on debt or deficit levels.

That needs to happen with a sense of urgency.

Canadian housing affordability needs to include addressing homelessness

We’ve previously discussed how housing is a system, with homelessness impacting affordable community housing impacting market-based rentals impacting ownership. 

The current discussion on housing affordability in Canada is focused primarily on density, home ownership and purpose-built rentals. 

We need to broaden that discussion to include solutions for homelessness. You can’t solve one part of the Canadian housing affordability crisis in isolation of the others.