Rethinking Housing in Canada: Lessons from Europe and Innovative Solutions

By Ian Bickis

Canada is currently facing a significant housing crisis, characterized by soaring prices and insufficient supply. Experts argue that adopting a combination of government-supported affordable housing, alternative models like co-operatives and co-housing, and advanced building techniques could play a transformative role in improving the country’s housing system. These concepts, increasingly relevant in Canada, are already well-established in various parts of Europe.

Learning from Europe

Carolyn Whitzman, a senior researcher at the University of Toronto’s School of Cities and the author of Home Truths: Fixing Canada’s Housing Crisis, highlights several modes of success in European countries. For instance, in Vienna, approximately a quarter of residents live in social housing, a model shaped by specific historical circumstances but offering valuable lessons for Canada. Furthermore, France is on a path to ensure 20% of its housing stock remains “non-market”—this includes government-subsidized or otherwise non-tradable homes—currently standing at around 17%. This is achieved by purchasing or constructing buildings while maintaining neighborhood diversity.

The Importance of Sustainable Funding

Whitzman points out that Canada once recognized the potential for non-market housing, having introduced similar targets in the 1970s. However, the federal government stepped back from housing construction in the 1990s, leading to a significant decline in affordable housing development. In contrast, countries like France, Denmark, and Austria have implemented long-term funding plans, utilizing systems where the government provides subsidized loans. After being paid back over decades, these funds are recycled into new housing projects. This revolving fund is recognized as a gold standard, promoting sustainability in housing policy over extended timelines.

In 2022, Denmark reported about 21% of its housing as non-market, while the Netherlands exceeded that figure at 34%. Canada, however, lags significantly, with only around 3.5% non-market housing. The federal government has rolled out various funding programs, including a $55 billion apartment construction loan initiative, yet experts believe existing programs are inadequate in meeting the needs of low-income populations, primarily due to unclear definitions of “affordable.”

Building a Diverse Housing Landscape

Sasha Tsenkova, a professor at the University of Calgary’s School of Architecture, Planning and Landscape, emphasizes that providing diverse housing options, including non-market rentals and various ownership models, is essential for a resilient housing system. A wider range of affordable choices allows people to progress more steadily up the housing ladder without feeling pressured to buy a home prematurely. This flexibility enhances life choices, mobility, and educational opportunities for individuals, particularly younger generations.

Diverse housing models—including co-operatives and co-housing—are increasingly gaining support. The federal government has earmarked $1.5 billion for the development of co-operative housing, while co-housing projects, like Treehouse Village Ecohousing in Nova Scotia and Little Mountain Cohousing in Vancouver, are offering innovative living solutions that challenge traditional notions of homeownership.

Innovations in Construction

In addition to evolving ownership models, advancements in construction techniques, such as modular building, are critical for increasing housing supply efficiently. Countries like Sweden have successfully employed these methods, resulting in quicker construction timelines and potentially lower costs. While Canada is beginning to explore modular construction, it requires stable demand and long-term commitments to realize its full potential.

Facing the Challenges Head-On

Despite Europe’s evident progress in addressing housing needs, they too are not immune to systemic issues like lengthy waiting lists for supportive housing and rising rents. Canada, emerging from decades of federal disinvestment in housing, is slowly ramping up its efforts. However, Whitzman notes that the process is just beginning; many of the current programs are still in early stages, and substantial adjustments are required to make real progress.

The journey to revamp Canada’s housing landscape is fraught with challenges, yet experts remain optimistic about the potential for innovative solutions. By examining successful models from Europe, establishing long-term funding commitments, and encouraging a diverse approach to housing, Canada can move towards a more equitable and stable housing system for all.

This report by The Canadian Press was first published November 3, 2024.

Ultimately, addressing Canada’s housing crisis requires a comprehensive approach that marries lessons learned from abroad with innovative ideas tailored to Canadian realities. As organizations and governments continue to explore these pathways, the potential for meaningful change in housing availability and affordability remains strong.