Contrary to popular belief and arguments in housing discourse across the globe, Canada’s housing crisis, as in Nigeria, goes beyond homes affordability and supply shortage, according to a new report which locates the crisis in what it calls a “financialized housing system.”
This system, the report explains, is one that idealizes homeownership and treats homes as financial assets instead of social goods. This is akin to Nigeria’s problem where the country’s wide housing gap and low homeownership rate are rooted in its financialised system which has little or no consideration for housing as basic human need.
In a rather curious way, Nigeria and Canada share some similarities in housing situation which is dire in both countries. Frequently cited housing problems in Canada, as it is in Nigeria, is unaffordability of available homes and shortage of adequate supply.
Nigeria is one of the most expensive housing markets in Africa which is why most of its citizens are renters, making it also one of a very active rental market where 80 percent of its 200 million population lives in rented accommodation, according to reports.
In Canada, most of the citizens are in the grip of a deepening housing crisis, yet not everyone agrees on what exactly the crisis is. Unlike Nigeria, however, the common narrative focuses on an affordability crisis for homeownership, attributed to either excessive demand from immigrants and foreign buyers or a lack of supply.
There is supply in Nigeria, coming from both public and private sector operators, but their best is not good enough as the country needs to build about 700,000 housing units annually for 20 years to be able to close its housing gap whereas its annual output, at the moment, is less than 100,000 units.
Canada’s housing market is among the most unaffordable, with one of the highest house-price-to-income ratios among the organization for economic co-operation for development (OECD) member states.
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A recent report by the duo of Yushu Zhu, Assistant Professor, Urban Studies and Public Policy at Simon Fraser University, and Hanan Ali, Assistant Researcher, Housing Policy, Urban Studies Programme of the same institution, explains that housing prices in Canada soared over 355 percent between 2000 and 2021, while median nominal income increased by only 113 per cent.
They point out, however, that today’s housing crisis in that country extends beyond unaffordable homes and supply shortages, stressing that “the crisis is rooted in a deeply financialized housing system that idealizes homeownership and treats homes as financial assets instead of social goods.”
Canada has been contending with housing crisis that has pushed many residents, especially immigrants which include many Nigerians who left Nigeria in search of greener pastures, finding homes in odd places including cemeteries and other locations not fit for human habitation in the country.
“The housing crisis is not new in Canada,” Zhu noted, citing a book on the evolution of Canadian housing policy written by historian John Bacher which says that, in the early 1900s, Canadians were “faced with the choice of accepting shelter that was overcrowded, poorly serviced, or below minimal building-code and sanitary standards.”
For over a century, the housing crisis has not only persisted but worsened. It got to a point when the Canadian authorities had to cap the number of foreign students coming to the country to study, believing that they added to the crisis.
The crisis is not without dire implications for the citizens and, as Zhu and Ali put it in their extensive report, “the convergence of diverse housing vulnerabilities have affected people from all walks of life.
“Renters, for instance, are facing rent increases double that of inflation, alongside evictions and displacement. Homelessness is on the rise, disproportionately affecting Indigenous and black people, gender minorities, and persons with disabilities.”
They added that homeownership is increasingly precarious such that over one-third of Canadian households own a home with a mortgage, and of those, two-thirds have trouble meeting their financial commitments.
“Decreasing percentages of both homeowners and renters can meet their financial commitments without any problems. As a result, many Canadians have had to sacrifice privacy, comfort, stability, and location, leading to hidden housing vulnerabilities like undesirable living conditions, overcrowding and dissatisfaction.
Many young adults are now delaying homeownership, staying in their parents’ homes longer, postponing starting families or relying on parental financial support to buy homes, which can widen intergenerational wealth gaps,” they noted.
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