Human Resources Committee on June 6th, 2023

[The Chair, Liberal, Bobby Morrissey]

Thank you, Ms. Chabot.

We will now suspend.

For the benefit of the witnesses, we will resume 10 minutes following the announcement of the vote in the chamber. Until then, we'll suspend and we will resume at that timeline.

[The Chair, Liberal, Bobby Morrissey]

The committee will resume its meeting.

I thank the witnesses for standing by while members had to conduct their duty, which was to vote.

We will now resume with Madam Zarrillo for six minutes.

Madam Zarrillo, you have the floor.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you, Mr. Chair.

I appreciate the witnesses' patience with the vote.

I want to start my questioning with Mr. Sullivan.

Mr. Sullivan, I was a city councillor for about eight years. It was obvious that there was a gentrification going on, certainly in my riding of Port Moody—Coquitlam. We've just recently reported the third-highest rents in the country in my riding, and I can see it manifesting on the ground in communities as more and more people struggle to find homes.

My question to you is this: Why does Canada not have a healthy supply of stable rental tenure for people?

[Ray Sullivan]

It is very much a supply issue. Up until the mid-1990s, we invested in rental supply, generally with incentives for the private market, but as importantly, we invested in community non-profit and co-op housing. That investment curtailed drastically after the mid-1990s, so what we're seeing now is the impact of a failure to invest in those decades.

It has gotten better. We've recouped some of that ground in the past five years, especially under the national housing strategy, but a lot more needs to be done to get there. A lot of studies have shown that for every affordable rental home that gets built under national housing strategy programs, we're losing multiple homes—some say four times as many, and some say 10 times as many—in the private market that are renting at that “low end of the market” level. This is the kind of housing we need to preserve, and this is why an acquisition and preservation strategy is one good option to do some of that.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you very much.

When we talk about supply.... Unfortunately, I sat with a council that had a very high-level, macro view of supply and demand without really that finer point.

For the record, is there a serious lack of affordable housing supply and rental tenure in this country right now?

[Ray Sullivan]

Unquestionably.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Is that due to a lack of investment over 10 years, 20 years, 30 years, 40 years or all of it?

[Ray Sullivan]

It's about the last 30 years. It's great to see a lot of focus being paid to reinvesting in the supply of housing, especially rental housing and especially non-market and affordable rental housing. CMHC did come out with a study—I think it was just over a year ago—saying that we need to increase the pace of new home construction by over three million units to catch up and balance that market. It's coming up with a follow-up study to break that down by income groups. I think we need to target and keep our eye on affordability as we're trying to solve an affordability problem. We need supply, but we need to target the supply that is going to make the biggest impact, and that's the supply that's accessible to people with middle and more modest incomes, which is difficult for the private market to produce on its own.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

That was one of my questions here: How does the market create affordable, secure rental tenure for low-income and middle-income Canadians without government support?

[Ray Sullivan]

Mr. Brooks and the witness from EOLO talked about housing allowances and rental subsidies. That's definitely a part of it. However, the stability is really going to come from a solid supply of non-market housing, of co-op and non-profit housing dedicated for that purpose. Security of tenure is higher than in the private sector. Affordability, especially over time, gets stronger and stronger as it goes on. This is where, again, as I said before, I'm 100% on board with what Scotiabank called for last year: to double the supply, the relative supply, of non-market housing.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

You mentioned revisiting the national housing strategy. Has the federal minister or the federal ministry of housing convened a round table, a check-in or a review with non-profit and co-op providers across the country that you're aware of?

[Ray Sullivan]

The minister held some round tables on some national housing strategy programs just a few weeks ago. I've been working with the CMHC to develop a standing advisory group that can help to refine and create those kinds of programs that are benefiting from that practical, on-the-ground experience that our members bring. However, I do think it is time to step back and look more broadly at the national housing strategy, because enough has changed in the last five years. Programs that were designed for a period of stable costs and low interest are not necessarily going to be the right programs for today, where those things have changed.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you for that.

CMHC, when Romy Bowers came to this committee, talked about how they'd been out of the business of supportive housing for such a long time, they didn't necessarily have the skill base within the organization anymore. Are you seeing this round table that you just spoke of as an opportunity to work closer with CMHC and maybe re-educate them on how to work in these partnerships?

[Ray Sullivan]

Yes. Our members are that expertise. Our members for decades have been doing this work on the ground in communities. We're happy to collaborate in any way we can to strengthen that impact.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you so very much.

I also have a question for Christian from Aliferous.

What kind of supply do you feel is missing in the market right now?

[Christian Szpilfogel]

That's a really good question. As I was answering earlier, in my estimate, about 70% to 75% of housing is provided by very small landlords. To me, then, that's part of the tool of creating availability, but we need a balance between private market and publicly funded housing.

Mr. Sullivan has made some excellent points in terms of making sure that, while the private sector is a key tool for scale, we do have an opportunity to take a look at public housing and public funding for those of us in the private sector who can't necessarily provide that particular type of housing.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Madam Zarrillo.

Mr. Aitchison, you have five minutes. This will be the final round with these witnesses. You have the floor.

[Dr. Gaëlle Fedida]

Thanks, Mr. Chair.

I want to go back to you, Mr. Brooks. You referenced the number of units that the CMHC says we need to get built by 2030 to restore affordability. It's a crazy number, and certainly what we would have to do is at least double a year than the best year we've ever had.

Can you give us some thoughts on this? I mean, how corporations are treated in terms of taxes and incentives and all that kind of stuff is one thing, but on the physical act of building that many units, how are we going to do it?

[Michael Brooks]

Through you, Mr. Chair, that's the toughest question I've had so far: How are we going to do it?

Here's the problem: We don't have enough manpower in this country to double production of housing in the period that we're allotted. We need to tweak our immigration system to bring in a lot more skilled labour and not simply reward economic immigrants. We need to get into the high schools to tell our younger folks that a trade is a good career. Many more of them should be pursuing that career. So many in the labour pool right now are boomers like me, who will be retiring soon. That's another barrier.

Look, 2030 is seven years away. As I mentioned earlier, it takes five years to get approvals in a lot of cities in Canada. Even if we were to start right now with a rezoning application or a site plan approval application or whatever it is, it takes so long to get through some planning departments. We need to focus on speed.

We've always said in our industry that we need as-of-right zoning. When I started my career in the eighties, we had as-of-right zoning. You could put up an apartment building and just go in and apply for your building permit. As long as you were complying with the building code, you were building as of right. Maybe you'd look for a minor variance to close in the balconies. That was it in the eighties. Now everything is a “craft”. Everything has to go through series after series of meetings.

Those are two.

[Dr. Gaëlle Fedida]

I want to elaborate a little more on that. Clearly, all levels of government have skin in the game and have some responsibilities here. Municipalities are definitely on the leading edge of this and on the front lines of the housing crisis and the housing situation—and also a lot of the solutions.

If things were easier in terms of the municipal approvals process and there was more certainty, since investment likes certainty, do you think we might see any sorts of innovations in the construction industry that would make the construction process faster if there was some level of certainty in the process that made those investments pay off?

[Michael Brooks]

I'd love to see a modular construction industry in Canada. If we were able to build a big modular construction housing plant near a major market and have all the builders commit to buy from that modular housing company, that would be a great way to speed up construction. We don't have such an industry yet in Canada, and I'm not sure we'd have the scale yet unless we did aggregate buying, but I would love to see that.

Other initiatives are cross-laminated timber. CLT buildings go up much quicker, and they're much greener. That's another possible innovation.

[Dr. Gaëlle Fedida]

Could you speak as well to the concept of one of the things we've talked a lot about? The governing party and certainly our party have talked a lot about the concept of unloading underutilized federal buildings.

I know that the conversion of office space to residential space can be difficult and doesn't always make sense in terms of affordability, but what about options like free land? There are other options out there, particularly in larger centres, I'm thinking, that might be an option there. Can you speak to that?

[Michael Brooks]

I absolutely think that is an option. I know that in the city of Toronto they have an agency that has been looking to lever the city's vacant and underused land. I think that federally you have the Canada Lands corporation, which is charged with disposing of excess or surplus lands.

I'm thinking of the Downsview airport. There's a massive site at the end of a subway that could have a lot of housing on it, and there have to be other examples around the country where there are big federal land sites that could be used.

[Dr. Gaëlle Fedida]

That's great.

I think I'm out of time. Thank you.

[The Chair, Liberal, Bobby Morrissey]

You have a few seconds, but thank you, Mr. Aitchison.

Mr. Van Bynen, you have five minutes or less.