Canadian leaders are a curious type of people. They always want to reinvent something, or make it uniquely Canadian. Take our military procurement. We live next door to the most advanced military in the world. Canadian companies or Canadian subsidiaries of American companies, build advanced weaponry, ships, and airplanes. To resupply and reequip the military, we could just ask the Americans what we could use. Instead we use procurement as a form of nation-building and job creation by adding “Canadian” features. Reinventing the Canadian wheel so to speak.
This was common for decades in the rail and transport industry. Canadian equipment was based on US specs, but there were “Canadianisms” added. This added cost and time to projects. Back to the military for a second, how long does it take to get new helicopters, fighter jets, and ships still?
We are told by all the experts that Canada has a housing crisis. Demand has outstripped supply, and despite the “best” efforts of governments, shovels are not getting into the ground fast enough. Just look around at the current housing prices and see how expensive things are. Increased demand plus reduced supply equals super high prices. And that is if you want to buy a house, or can afford to buy a house. The rental market is even tighter.
Fear not, because politicians have a plan. Or many plans. Sort of. I guess. Maybe. One plan is to have the Canadian Mortgage and Housing Corporation and the federal government develop a set of home plans that can be pre-approved and built rapidly. Those plans, once created, will be given to builders for free. This all sounds great so far except for one thing – this has been done before. In fact, this set of plans still exist.
Canada had one of the largest military mobilizations by the end of World War Two, over 1.1 million people. Many of these were young people looking to start their lives after their military service. All needed somewhere to live.
The Central Mortgage and Housing Corporation (now Canadian) launched a contest – The Canadian Small Homes Competition – in preparation for this housing challenge. Resulting from this competition, a book of home designs called “67 Homes for Canadians.”
This book of designs, combined with the National Housing Act that provided mortgages at a rate of 4.5 per cent over a fixed term of 15, 20, or 25 years, put Canada on the path of fixing its Baby Boom housing crisis.
The homes in the book should look very familiar to everyone in Canada. The designs in the book, and other subsequent books, are the epitome of 1940s and 1950s residential construction. The homes offered two, three, or four bedrooms, and averaging between 750-1,250 square feet in size. Simple and affordable were the buzzwords here.
To “solve” our housing crisis, we only need to look to our past. Very few updates are needed to these designs like changing out the oil-fired furnace for something greener and cleaner. With this, and the Bank of Canada lowering its prime rate to 4.75 per cent (with more cuts to come) it should be easy to get more people into homes and solve this crisis, right?
Except I don’t believe that some of the parties involved want to really solve this housing crisis. House prices have more than doubled in many markets in the last five years. New home starts are up, so too are the costs involved. There is only so much blame that can be put on the pandemic for supply issues. Similarly, only so much blame can go to having a lack of qualified trades people to build the homes, or available land, or zoning regulations. What about profit?
Yes, all these new homes cost more money to build, but the builders see more profit created from the construction too. Every business along the line – from design, to construction, to sales – are making more money in this “housing crisis.” Creating more supply would soften demand, thus lowering the profit for every party involved. Governments, of course, get to cash-in on this twice. First in increased taxes through homes that are worth more in a superheated market. Secondly, by spending time looking like they are considering, pondering, reflecting, and pontificating on a problem with the goal to solve it. If all these officials (elected and otherwise) didn’t have a housing crisis to solve, whatever would they do with their time?
The reinvention of the Canadian housing wheel is an ongoing struggle. It is made worse by those who profit the most from having a crisis in the first place. Sadly, the ones who actually live in the housing crisis, who are stuck paying more for less housing, or enduring precarious housing, are the ones who pay the most and get the least.
This column was originally published in the August 21, 2024 print edition of The Morrisburg Leader.