According to recent report on housing affordability showed that over 10% of Canadian families, about 1.5 million people, were in ‘core housing need’ according to the 2021 census, with another 250,000 Canadians facing homelessness. This problem has not only led to more people using shelters and setting up tents in big cities, but also in medium and small towns, something Canada hasn’t seen since the Great Depression of the 1930s.
The reasons for this crisis are mostly systemic, having grown worse over the last few decades, making it harder for both potential homeowners and renters. These reasons include:
High inflation and high interest rates
Rising rents
Conversion of rental homes
Increased immigration
Not enough tradespeople
Lack of nonprofit and cooperative housing
Growing income gap
Overlapping factors
Smaller issues like NIMBY (not-in-my-backyard) attitudes, converting homes into AirBnB and other short-term rentals, and slow approval processes and land use rules in some areas
Homeownership Imbalance And Wealth Transfer
Home equity has become a key way to gain wealth and plan for retirement, especially for those lucky enough to own a home. However, this has caused an imbalance, leaving many people unable to buy a home, especially in big cities. The transfer of wealth from Boomers to Millennials makes it easier for some first-time buyers to make big down payments, raising home prices. This is combined with risky homebuying practices, like blind bids, which might not always raise prices but can hurt new buyers and lead to shady realtor tricks like phantom bids. Over a third of people under 40 have stopped trying to buy a home, with this number rising to over 40% in the West.
Nationwide Survey Reveals Canadians’ Concerns for 2024: Housing Crisis, Financial Worries, and Trust in Government
Between February 29 and March 6, 2024, Recent Data did a nationwide survey with 1,500 Canadians aged 18 and above to look at the many challenges Canadians expect in 2024, especially focusing on the ongoing housing crisis, money worries, and trust in government. The results show widespread worries about housing costs, financial security, and trust in government, highlighting the need for strong policy actions to address these issues and bring hope for a better future for everyone. This feeling not only reflects the struggles Canadians face but also shows a growing doubt about things getting better.
The Ongoing Housing Crisis
Canadians are very worried about the housing crisis, with a big 68% thinking housing will get less affordable and harder to get in 2024, while only 10% believe it will improve. This serious view highlights the urgent need to fix housing costs and availability.
First-time buyers are in a tough spot, with a huge 74% of Canadians thinking the housing market will be more expensive and less available for them, compared to only 5% who hope for better prices and access. Plus, a worrying 57% of people hoping to buy their first home feel negative about their chances or have given up, up from 48% in September 2023.
Governments at all levels need to focus on making housing more affordable, which might include building more homes, setting rent limits, and giving financial help to new buyers.
Financial Insecurity
There is a worrying trend in Canadians’ money security, with half (52%) feeling insecure about their finances, while 33% have some worries but think their money is okay. This concern grows with 71% of Canadians saying their household debt is rising, causing money problems and instability.
Expectations for economic recovery in 2024 are filled with doubt, as 65% of Canadians expect a slow and uncertain path. Moreover, 69% believe that inflation and the cost of living will keep rising, hurting people’s finances.
Many Canadians worry about the social gaps made worse by the current situation. Specifically, 53% of people are concerned about growing economic inequality and social differences.
Overall, these findings show widespread pessimism and uncertainty about 2024’s economic outlook. Policymakers should work on economic stability, controlling inflation, and affordability to rebuild trust. Actions to boost economic growth, keep prices steady, and help households with rising living costs may be needed to handle these challenges effectively.
Government Stability
Public trust in government policies and economic stability seems weak, with 61% of Canadians worried about governance, while 70% see global economic conditions and geopolitical risks as unstable. To rebuild trust and ensure stability, policymakers must focus on being clear, responsible, and effective in their governance. Also, working actively with global partners to handle geopolitical risks and encourage international cooperation is important for protecting Canada’s economic interests in an uncertain global world.
First-time buyers are in a tough spot, with a huge 74% of Canadians thinking the housing market will be more expensive and less available for them, compared to only 5% who hope for better prices and access. Plus, a worrying 57% of people hoping to buy their first home feel negative about their chances or have given up, up from 48% in September 2023.
