Canada’s housing crisis has made it

U of G professor Paul Anglin suggests that a solution to the housing crisis may be an increase in supply via development projects. CREDIT: UNSPLASH

Canada’s housing crisis has made it more difficult than ever to find student accommodations

U of G expert suggests that the increase in price and decrease in availability is due to a supply shortage

ALYSSA MARKS

The annual scramble to find student housing is currently in full swing. With many leases beginning in May, the end of the winter semester marks a stressful time for students, not only when it comes to finding housing, but also in relation to academic, personal, and professional responsibilities.

We’ve all been there. Finding housing—let alone affordable housing— during the pandemic and housing crisis has been a struggle to say the least. The increased rent rates, limited availability, and lower quality of houses have been the root of many students' frustrations.

According to Rentals.ca, Guelph’s rental market is one of the highest in all of Canada, with the average cost of a one-bedroom marked at a whopping $1,729. With this in mind, an individual must earn $5,763 pre-tax per month to be able to afford rent for a one-bedroom apartment in Guelph, reports GuelphToday.

Ariel Westfahl, a first-year student at U of G, shares these frustrations, as do many students. This is her first time entering the rental market, and it hasn’t been an easy process for her or her friends.

“The housing market has been very competitive, and finding a place under $700 a month with our preferences was a bit of a challenge. Due to the housing crisis, a lot of landlords were increasing their lease price which left us with fewer options,” she said in conversation with The Ontarion.

She added that, since there are fewer rental properties available in the Guelph area, it makes finding student housing competitive and difficult.

Ryleigh Klem, a fourth-year student, also experienced similar challenges in her house-hunting journey.

“I was searching for just a room since the people I’ve been living with are graduating. I ended up finding a place that I really like, but it definitely wasn’t a quick process. I probably went through a dozen house viewings over the course of three weeks. . . It wasn’t uncommon for me to find places that were $650 to $750 a month, not including utilities,” she told The Ontarion.

Klem attributes part of the issue to the low minimum wage rate in Ontario.

“Ontario’s minimum wage isn’t high enough and a lot of students work minimum wage jobs to support themselves. I can work 20 to 30 hours a week depending on the time in the semester, but I still find that about 60 per cent of my monthly income goes to rent.”

But what else is going on? Why has it been so difficult to find housing in Guelph? Experts suggest that there may be a number of things contributing to the housing crisis.

To start, Canada is approximately 300,000 houses short for students, reports CIBC. In a Canada census study, it was found that students who live on their own during the school year and return home for the summer to live with their parents are broadly marked as living with their parents. The census is used to estimate the need for housing in Canada. So, with this faulty statistic, developers are not building houses to respond to the student demand because the demand is not known in the first place.

With universities accepting more students than ever before–including international students–in the midst of a housing shortage, access to affordable student housing is a growing concern. As basic economics can tell us, when there is a growing demand and limited supply of something, prices are bound to rise.

Dr. Paul Anglin, professor of real estate in the Department of Marketing and Consumer Studies at the Lang School of Business and Economics, believes that the housing crisis is primarily a supply concern.

“In regards to affordability, if I were able to wave a magic wand and offer something, I think the activity must be on the supply side,” he said in conversation with The Ontarion.

Anglin also said that the influx of people from Toronto moving to other areas in the GTA, including Guelph, is also a concern when it comes to availability and affordability. This has also increased with COVID-19, where many people are moving from downtown Toronto to less populated areas like Guelph.

“Students are competing with many other users,” said Anglin. This means that the housing crisis is not only affecting students.

“Tightness of the rental market is affecting students, low income workers, people who are moving from place to place, [those who] have not yet found a place to own, and people who would like to buy. As you have likely heard, the price to buy a house has increased, and people are looking at staying in rental properties for longer to wait for housing prices to decrease.”

The solution lies in the increase of development and construction of houses, said Anglin. There is a Canada-wide shortage of houses–300,000 houses for students, as CIBC reported–and so Canada needs to respond to the increase in demand by boosting the supply.

However, Anglin said that this idea is not shared by some people and governments.

“Sometimes, people argue that the solution to the problem of high rents is rent control. There are a number of issues with this policy, especially if the real source of the problem is due to too little quantity supplied,” he said.

“One of these issues may be particularly relevant to students. If there is rent control, and rents do not adjust to excess demand, then the landlord can pick and choose which of the many qualified tenants actually get to move into the advertised unit. As you may imagine, that choice may involve considerations that prevent students from being the winner in this lottery.”

He added that these considerations may include the widely held bias that landlords do not like renting to students because of financial instability, potential destruction of property, and a lack of previous references.

In the end, Anglin concludes that if there are not enough houses to meet the demand, the prices will simply continue to grow. He suggested that provincial and municipal governments invest in housing construction and developments over the next few years in order to make housing more accessible for all.

In the meantime, students will likely continue to bear the heavy burden of high rent and a brutally competitive housing market with little hope of reprieve.