Is Affordable Housing A Human Right?
Prime Minister Justin Trudeau seems to think so, and recently declared that the federal government would make “adequate housing” a right in Canadian law. At the same time, the Prime Minister announced a $40 billion plan over 10 years to a national “Human Rights-Based Housing Strategy.”
What Is The Rights-Based Housing Strategy?
The strategy has several components, first the government will provide $2,500.00 in annual rent support a year for low-income vulnerable families called the Canada Housing Benefit. Second, more social housing will be built across the country. Third, 100,000 new affordable housing units will be completed, along with repairs to 300,000 affordable housing units, and removing hundreds of thousands of households from “housing need.”
The plan is also geared to “protect” 385,000 households from losing their affordable housing (social housing), and commits to cut chronic homelessness in the nation for 50%. The aforementioned Canada Housing benefit will cost $4 billion over 8 years with cheques starting to get mailed in April 2020 until 2028, shortly after the next federal election in late 2019. The Canada Housing Benefit is the only part of the overall strategy that is receiving new government money, most of the funding for the $40 billion plan was announced in last year’s federal budget. The plan will also see certain federal lands transferred to private sector partners for housing development if they meet strict environmental standards.
Does This Mean Housing Prices Will Start To Cool?
While stakeholders and expert groups say the plan will have a positive impact on disadvantaged, low-income Canadians, the overall state of housing affordability for middle class Canadians will continue to worsen. The below graph outlines average family incomes and average home prices in some of Canada’s major cities. Overall, as supply constraints and price increases continue, first-time buyers will have to save and leverage more to afford their first home.