Ottawa voters see housing affordability as key election issue

OTTAWA · Housing affordability is a major concern for Ottawa voters ahead of the Oct. 26 municipal election. Many hope newly elected leaders at city hall can accelerate solutions to the high cost of buying or renting a home. Experts say the core issue is a mismatch of too much demand and not enough supply. A rapid increase in immigration, including international students and temporary foreign workers, has strained the rental market in particular.

"They can get on a plane this morning and arrive here tonight, but you can't put a house on a production line this morning and have it ready tonight," said Steve Pomeroy, an industry professor at the Canadian Housing Evidence Collaborative at McMaster University. For decades, the industry focused more on condos and single-family homes, exacerbating the supply issue. Costs for builders have also risen, with taxes, fees and land prices increasing. "Development land has gotten relatively scarce and that's driven the price up," said Mike Moffatt, the founding director of the Missing Middle Initiative at the University of Ottawa.

The COVID-19 pandemic further impacted construction through supply chain issues, rising costs and labour disruptions. In Ottawa, the asking rent for a one-bedroom apartment topped $2,000 per month in the first quarter of last year and has since fallen to $1,900, though the average rent actually paid continued to grow. Canada Mortgage and Housing Corporation data shows average rent for row houses and apartment units is higher in the city's outskirts. While changes to federal immigration policies have slowed construction nationally, Ottawa's housing pipeline remains active, with rental units being built at a pace not seen in decades.

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Moffatt calls that an "understated good news story," helped by government loan programs and GST breaks. He said as those units come online rents should "stay flat" or decline. Pomeroy, however, said the improvements are being seen at the higher end of the market, not among those most squeezed. "So lots of supply, but not at affordable rents," he said. CMHC declined a request to discuss its data and projections. Meanwhile, public housing remains under intense pressure, with Ottawa’s centralized waitlist for rent-geared-to-income assistance at 16,398 households. Only just over 700 households have received accommodation so far this year, with an average wait of five to eight years.

Cities are looking to make it easier for builders to construct housing. Earlier this year, Ottawa overhauled its development guidelines with new rules to allow four units of housing on any serviced residential lot. Carolyn Whitzman, a senior housing researcher at the University of Toronto School of Cities, said this is a "big part" of what cities can do. "The more plexes and small-scale apartment buildings we can help support, we can approve, the more likely that we're going to end up with more housing that families can afford close to jobs and services," she said. The rules also encourage larger developments near transit hubs.

Developers have pushed to streamline the approval process and paperwork, noting that delays add significant cost. "Like anything in life, time is money," said Moffatt. Reducing development charges, which Ottawa has agreed to do with financial help from higher levels of government, is also seen as key. These fees are paid per unit to fund supporting infrastructure. However, experts caution that such measures alone will not create housing affordable to all. "You throw all of that at a project and you might get affordability for starting professionals, like moderate-income affordability. You won't get a new build that is affordable to people on minimum wage," said Whitzman.

According to Statistics Canada data from 2024, more than 110,000 Ottawa households spend over 30 percent of their income on accommodations, a traditional budgeting benchmark. The data also found roughly 6.8 percent of households live in homes with an unsuitable number of rooms for the occupants. Pomeroy notes that unlike most industries, a boost in supply does not automatically lower prices in housing. "The industry won’t screw itself by building below cost," he said. Municipalities can use tools like inclusionary zoning, which requires a proportion of affordable units in exchange for allowing taller buildings near transit, though this approach has lost favour with the Ontario government and some housing experts.

With files from CBC News