Housing crisis

Federal budget not doing enough to end housing crisis, Sask. experts say

Although the latest federal budget focused on housing issues, some Saskatchewan residents and housing advocates say it falls short of expectations for addressing these issues.

The 2022 budget, unveiled on Thursday, has been dubbed the “housing budget,” with $10.1 billion in spending over five years on housing, including measures to get more people into their own homes.

“I still can’t see myself owning a home,” Saskatoon resident Justine Yantz said. “It seems a bit of an impossible dream to me right now, since we can’t even save money.”

Yantz, a single mother of a 10-year-old daughter with autism, myotonic dystrophy and intellectual disability, receives $955 from the province a month through Saskatchewan’s income support program.

Nearly $700 goes for his rent and the rest barely covers his utilities.

Yantz said his spending has increased over the past two months as inflation has risen.

“I can’t buy things I used to buy, like books or clothes for my daughter. … We’ve never been so broke before.”

Justine Yantz poses with her daughter, Serena. Yantz says it’s been hard to make ends meet under Saskatchewan’s new income support program and feels left out of the federal budget. (Submitted by Justine Yantz)

The budget includes $475 million for a series of one-time $500 direct payments to “those facing housing affordability issues,” the federal government said.

But Yantz, who says she has to use her childcare benefits to pay her bills, doesn’t see herself represented in the budget.

“I don’t think $500 is enough. That doesn’t even cover my rent.”

“Clearly not a budget solution for the homeless”

The federal government’s spending plan does little for renters, says Toby Esterby, president of the Saskatoon Housing Initiatives Partnership, a nonprofit focused on homelessness and affordable housing.

“Seeing this budget and other policies so far, they see tenants as second-class occupiers, he said.

Esterby said tenants are facing high eviction rates, with many late payments, and the $500 one-time payment for those facing affordability issues wouldn’t even cover two weeks’ rent for most.

Additionally, he says most people struggling with homelessness “can’t get an appointment at a bank,” so “it’s arrogant and insulting to create a program that requires an account, a identity and an electronic connection to receive these funds”.

Toby Esterby, president of the Saskatoon Housing Initiatives Partnership, says the budget aims to improve housing affordability, primarily for people with median incomes. (Shaun Salen)

The budget also extends the federal Rapid Housing Initiative, pledging $1.5 billion over two years to create at least 6,000 new homes to address homelessness.

It’s a step in the right direction, but creating more homes alone cannot solve the housing crisis, Esterby said.

“It’s a very small percentage of the needs. We would need at least 20% of those 6,000 units just for Saskatoon, and that’s supposed to cover the whole country. Clearly not enough,” he said.

He also said the rapid housing initiative should include city-specific solutions, because what may work in Toronto or Vancouver won’t necessarily work in Saskatoon or Regina.

Proper consultation with people in need and the organizations that work with those people would have led to better solutions, Esterby said, but the budget instead aims to address housing affordability for those on the median income.

“This is a budget solution for housing. It’s clearly not a budget solution for homelessness,” he said. “You can’t solve homelessness by building a bunch of $300,000 houses.”

Payment of $500 for a “band-aid solution”

Len Usiskin is the CEO of Quint Development Corp., a non-profit organization that works to provide affordable and transitional housing in Saskatoon for people with rental issues.

He said while $10 billion in spending over five years sounds like a lot of money, it won’t go far when spread across the country.

He says that in September, Quint issued eviction notices to 11 tenants – about the number of notices they would normally issue over the course of an entire year.

“We saw the situation worsen in the last quarter of 2021. Between October and December, we saw the number of people in arrears increase significantly,” he said.

The $500 one-time payment appears to be a “band-aid solution”, he said, with few details attached and no definition of how “people facing affordability challenges” will be defined.

Len Usiskin, executive director of Quint Development Corp., says there are few details around a one-time $500 payment for those facing housing affordability issues. (Submitted by Len Usiskin)

He said Ottawa should have considered expanding the Canada Housing Benefit, which “subsidizes people’s rent on an ongoing basis.”

He also wants to see support for “affordable, not-for-profit rental providers, so we can then subsidize maintenance costs and provide support.”

Jason Childs, an associate professor of economics at the University of Regina, said the budget focused more on urban centers like Toronto, Vancouver and Montreal than Saskatchewan or Alberta, and noted that $10 billion in spending is a small fraction of the $450 billion budget.

“We’re talking about $2 billion in spending every year. Every year in Canada, residential construction investment is $250 billion. That’s not going to drastically move the needle anywhere,” he said. said Childs.

Jason Childs, an associate professor of economics at the University of Regina, says the 2022 budget is “an overall budget” with “a lot of inconsistencies.” (Radio Canada)

Part of the $10 billion in spending is a new Housing Acceleration Fund — worth $4 billion over five years — to help municipalities accelerate housing development, aiming to create 100,000 new homes over the next five years.

He is optimistic about the fund, but said 100,000 units will not meet demand as the influx of immigrants to Canada increases every year.

from Canada Immigration Plan 2021‒2023 aims to add 411,000 permanent residents in 2022 and 421,000 in 2023.

“Acceleration fund could reduce authorization time [for housing construction]but none of that is really going to change the supply of housing relative to the demand,” he said.

Additionally, the goal of 6,000 new housing units under the Rapid Housing Initiative “will be swallowed up by Toronto on its own, and won’t be enough for Saskatchewan or anywhere else,” said Childs.

“It’s an all-encompassing budget – which is headline-grabbing,” with “a lot of inconsistencies,” he said.

“He’s trying to do six different things, half of which contradict the other half.”

That won’t solve the housing problem in the immediate future, especially with inflation at its highest level in 30 years, Childs said.

“This budget was basically telling the Bank of Canada that you’re on your own to fix inflation, so we’re probably looking at a 1.5% increase in interest rates in six months.”

In a statement Friday, Saskatchewan’s premier also took aim at the federal budget, saying it “misses the mark on provincial priorities” such as the Canada Health Transfer and initiatives for the health sector. energy.

“This federal budget continues to invest in programming without having the economic stimulus incentives to pay for it in the future,” Scott Moe’s emailed statement read.

Some relief for homebuyers

Childs said the budget does not meet the needs of those on minimum wage — something Manish Shamnani, a mortgage associate with Dominion Lending Centers in Regina, also notes.

“A person on minimum wage absolutely cannot afford a house unless they are willing to opt for a smaller condo,” Shamnani said.

However, the new Tax-Free Savings Account introduced in the budget – which would give first-time homebuyers the opportunity to save up to $40,000 with tax-deductible contributions and withdrawals – will help. for first-time buyers, he said.

And the accelerator fund is a step in the right direction, but the “market is already crazy, with high demand and low supply” in places like the Greater Toronto Area, he said.

Manish Shamnani, mortgage associate at Dominion Lending Centres, says a new tax-free savings for first-time home buyers will help. (Submitted by Manish Shamnani)

In Saskatchewan, Shamnani said the housing market has seen relatively stable inventory.

“In the coming months, demand will still be there, mortgage rates will go up, but I don’t think house prices in Saskatoon will go down,” he said.

“A lot of it is ‘what’s the definition of affordable housing?'”