The fallout from the housing crisis means that as a city, we spend $30 million on emergency shelter costs every year. People experiencing homelessness engaging with police costs roughly $25M every year in Ottawa. We spend over $15 million a year on keeping people in hotels, because there is not enough affordable housing. Ending the housing crisis in our city means that we invest at least as much in solutions, as we do managing the crisis.
In order to make our city affordable, the smartest capital investment we can make is in non-profit housing.
I want to start by saying that homelessness is not inevitable and there are solutions to this crisis. Across the country and the world we have seen communities reduce homelessness and even end it altogether. We know that affordable non-profit housing is at the core of the solution.
Mass homelessness is a relatively new phenomenon. In the 1960’s and 70’s, Canada produced almost 20,000 affordable non-profit homes every year. As funding decreased for this type of housing stock, mass homelessness developed.
For the last 50 years, we have relied predominantly on the private market to resolve the housing crisis. Housing has become a commodity. One in five buyers in the housing market today are investors. Potential first time home-buyers are increasingly forced into the rental market, driving up rental prices for all. The average market rent in Ottawa today for a one-bedroom apartment is $2000.00. Clearly, relying on the private market alone is not working.
The fallout from the housing crisis means that as a city, we spend $30 million on emergency shelter costs every year. People experiencing homelessness engaging with police costs roughly $25M every year in Ottawa. We spend over $15 million a year on keeping people in hotels, because there is not enough affordable housing. Ending the housing crisis in our city means that we invest at least as much in solutions, as we do managing the crisis. We do this knowing that in the long-term costs go down, because providing housing is far less expensive than managing homelessness.
In order to make our city affordable, the smartest capital investment we can make is in non-profit housing. This simply means housing that is set apart from the private market, where there is no profit motive. It includes everything from supportive housing to coops. Rental costs are tied to an individual household’s income, rather than average market rent, ensuring that a household pays only 30% of their income on rent.
While market rents will continue to escalate, non-profit housing provides affordable housing stock in perpetuity. Further, in contrast to the calls simply for “more supply” to regain balance in the housing market, non-profit housing provides actual competition to the private market, because there are real affordable options. Increased private supply will not solve our housing crisis as long as so much of the market is made up of investors setting the terms, with little incentive to reduce costs.
We urge Committee members to act boldly and double the capital expenditure for non-profit affordable housing set in 2015, from $15 M to $30 M. We know that $15M no longer buys what it did seven years ago. In real terms, the amount of money for non-profit housing is going down, rather than up.
This goal comes from the Starts With Home campaign we launched for the municipal election. We set a target of doubling the yearly number of new non-profit housing options in the 10 year plan from 500 - 1000. We proposed doing this largely through a non-profit housing acquisition strategy, where the City or Ottawa Community Land Trust purchases older rental housing likely to be demolished, and turns it over to non-profits for affordable housing.
There are few things more important to creating a healthy, vibrant city than affordable housing. I am encouraged that 16 members of council have endorsed in whole or in part the Starts With Home campaign. You are in good company. With over 160 endorsing organizations and countless individuals, the broad-based support demonstrates that non-profit housing is no longer thought of as a social service sector issue alone but foundational to making our city liveable.
Small business groups such as the Board of Trade and Ottawa Coalition of BIA’s support the Starts With Home campaign because if you can’t afford to live here, you can’t work here either. Hospitals endorsed it because “hallway medicine” is largely due to people unable to leave because they have no affordable home to go to, effectively homeless. Seniors advocacy groups endorsed it because there are no affordable housing options in their own neighbourhood as they look to downsize and want to age in place, but can’t. Community Associations endorsed it because members increasingly see the impact of the housing crisis with visible encampments and increased homelessness. School boards endorsed it because kids are going to school hungry when parents have to choose between rent and food. The housing crisis permeates every part of our city.
Perhaps the best example of reducing homelessness, and is very close to ending it entirely is Finland. It did not get there overnight, but rather with almost 30 years of serious investment in non-profit housing. Finland, like Ottawa, used the Housing First approach, where a person is immediately placed in housing before expecting other aspects of their life to change such as employment, school, mental health recovery.
However, Housing First does not work unless there is actual housing to make it happen.
I encourage you to think in terms of an 8 year timeline rather than a four year timeline. Given the new faces around the Council table, most of you will be here for 8 years. We can get a lot of housing built in 8 years. With the new Rapid Housing Initiative funding for Ottawa announced this week, a rejigging of National Housing Strategy funding streams to target smarter non-profit housing investment, and an increasing level of public will to tackle this crisis seriously, we are well positioned as a City to be more ambitious in our housing goals.
We can do so much better. We’ve seen better and we’ve done better in the past, when Canada did not have mass homelessness. The difference is that we invested deeply in affordable, non-profit rental housing. I urge you to increase our city’s investment towards non-profit housing also. It is cheaper, smarter, and more compassionate to invest in making sure that everyone in our community has a home.