A researcher associated with the Institute for Socio-Economic Research and Information (IRIS) takes a nuanced look at certain assertions that invariably come up when it comes to the housing crisis in Montreal and which eclipse the scope of the problem, in a analysis which appears on Wednesday.
Is Montreal affordable? If you ask the question to an elected official, you will often hear him recall that the Quebec metropolis remains affordable, if you compare it to Toronto or Vancouver, which is not false. Researcher Marie-Sophie Banville, who notably gave a course on the financialization of housing at Concordia before starting a doctorate in law at the University of Victoria, criticizes this comparison, however, which hides blind spots.
“The problem with that is that Toronto and Vancouver are setting North American and international affordability records. So, when we compare ourselves to Toronto and Vancouver, we put ourselves on a list where we absolutely do not want to be, ”she mentioned in an interview with the To have to Tuesday, on the eve of its first publication for IRIS.
Indeed, according to a ranking compiled by Oxford Economics in January, which the researcher mentions, Vancouver is the least affordable metropolis in North America, while Toronto comes in fourth on this list. Montreal, which remains more affordable than these two cities, has seen the resale value of properties on its territory increase by 314% between 2000 and 2022, i.e. at a faster rate than large North American cities such as Los Angeles. Angeles (+296%), San Francisco (+267%) and New York (+158%), raise the socio-economic record of IRIS.
“As a result, although real estate prices in Montreal remain, to this day, lower than those of major American metropolises, we nevertheless observe a meteoric rise in prices when properties change hands,” indicates the analysis. A situation which affects in particular the tenants of the metropolis, since the owners often have no other choice but to considerably increase the rent of the occupants of their accommodation to repay their mortgage, estimates Mme Banville.
“The trajectory in which Montreal finds itself is worrying”, adds the researcher, who believes “that we minimize the problem” when we compare the housing situation in the Quebec metropolis to that which prevails in Toronto and Vancouver.
Always building more
If we lack affordable housing, isn’t it enough to build more? This is the primary solution that the Canada Mortgage and Housing Corporation (CMHC) regularly mentions in its reports. In an analysis published last week, it predicts that it will be necessary to build 3.5 million more residential and rental units in the country by 2030 than what is envisaged based on the current rate of construction.
However, it is not just the supply that must be taken into consideration, but also the demand, notes Marie-Sophie Banville, who believes that the role of the various home ownership assistance programs piloted by CMHC in the scarcity of available housing should be taken into account.
“No matter how many times we repeat that we need to increase supply, if we don’t take our foot off the demand accelerator and change this culture of over-stimulating demand, we are doomed to continually repeat that we must increase the supply”, illustrates the researcher. She believes that CMHC should revise its home ownership programs to limit their impact on the tightening of the real estate market.
Joined by The duty, CMHC economist Francis Cortellino acknowledges that “buyer demand may play a role” in the lack of available housing on the market. He says, however, that it is on the supply of housing that we must bet to counter a long-term shortage. “We must practically double the number of dwellings compared to the status quo”, he insists.