Ontario’s Housing Affordability Crisis:
Housing has reached a crisis point in Ontario. Previously considered an urban issue, housing affordability is now impacting communities of all sizes across the province. As Ontarians spend more of their income on housing, they have less available to spend on other goods and services, resulting in wide-ranging implications for the business community and the overall economy.
While distinct, housing supply and affordability challenges are mutually reinforcing: as mid-high income earners are priced out of the real estate market, they are increasingly occupying market rental housing for longer, contributing to low vacancy rates and rising rental rates. This puts additional downward pressure on the limited supply of more affordable, non-market housing options, where waitlists can reach up to 12 years across the province, further compounding the homelessness crisis.
At the same time, social and economic pressures, such as inflation and supply chain challenges, are contributing to rising costs for housing development (which has not kept pace with demand), while hindering mobility along the housing continuum.
Meeting the provincial target of building 1.5 million homes by 2031 will require an all-hands-on-deck approach: the private, public, and non-profit sectors all have critical roles to play in fostering an inclusive labor force, championing affordable housing solutions, and promoting complete communities. This policy brief showcases several innovative partnerships and approaches underway across the province that aim to address housing affordability and supply, with policy recommendations to build upon the success of these models.
The housing affordability crisis is significantly impacting the ability of businesses to attract and retain talent, exacerbating challenges associated with ongoing labour shortages, an aging workforce, and the housing crisis itself, as the labor needed to build more housing is increasingly priced out of communities across the province.
The OCC’s most recent annual Business Confidence Survey found that most organizations in Ontario continue to report labor shortages in their respective industries (68%), with heightened job vacancies in the construction sector. Compounding these shortages is the record pace of net interprovincial migration losses, partly driven by poor housing affordability.
In an effort to help address overall labor shortages – including filling gaps in the skilled trades to meet housing targets – immigration into Ontario is expected to more than double by 2025. Ultimately, improving housing supply and affordability in Ontario will require domestic and local workforce development strategies, immigration, and dedicated housing and support for seniors, students, newcomers, and other equity-deserving groups.
To help address both labor and housing shortages, Regional Tourism Organization 12 / Explorers’ Edge is pursuing a concurrent approach to affordable housing and workforce development for the tourism industry in the Muskoka, Parry Sound, Almaguin, and Algonquin Park regions. The Catalyst Housing model aims to attract workers by providing below-market rental housing, alongside career, life skills, and financial literacy training. Each cycle of the model would take place over a potential two-year period, during which participants would work in the regional tourism industry.
The organization refers to this new model as a “workintegrated housing ecosystem.” The goals of the model include:
• Incentivizing and attracting workers to the region.
• Advancing careers in the tourism industry.
• Supporting mobility along the housing continuum.
The model seeks to leverage public, private, and non-profit sector investment, with a focus on social enterprise and social impact bonds to ensure sustainable operations. Recognizing disproportionate gaps in housing and employment for marginalized groups, the model intends to serve local residents, Indigenous people, immigrants, women, youth, and students.
The Aecon-Golden Mile (A-GM) project is a construction joint venture between Aecon Group Inc. and the Centre for Inclusive Economic Opportunity, Golden Mile, designed to help build prosperity through inclusive economic opportunities in the Greater Golden Mile district, a commercial area in the Scarborough district of Toronto, Ontario. A-GM is a community-owned (51%) construction company that prioritizes diversity and local hiring, training residents facing barriers to the labor market throughout the district. Most recently, A-GM has been recognized as a preferred vendor by EllisDon and Kilmer Group for Hydrovac services.
Many existing A-GM project positions do not require previous construction experience and offer competitive pay, tailored job training, and opportunities for advancement. The goals of the venture include:
• Becoming a contractor of choice for redevelopments in the Golden Mile area.
• Recruiting and training local residents facing barriers in the labor market, including newcomers, women, and other equity-deserving groups.
• Growing local economic opportunities and reinvesting in the community.
• Investing in employees, including full operation and staffing by local residents.