Thank goodness for immigration, but about
affordable housing…

Absent immigration, Canada’s labour market could soon be relying on 70-somethings on walkers. It’s is the only reason we still have an acceptable working-age labour force, according to the Financial Accountability Office of Ontario (FAO). 

Since the mid 2010s, immigrants have contributed at least 63 per cent of the increase in Ontario’s labour force.  Moreover, the share of immigrants in the vital working age of 25-54 has leapt from 44 per cent in in the 1980s to well over 60 per cent today. 

Immigrants are in general much younger on average than Ontarians as a whole.  They also earn less. But from scientists to small-business entrepreneurs to farm labourers, from construction to manufacturing and to healthcare, the 272,424 permanent residents in Ontario made a massive contribution to our economic growth in 2022.

“As Ontario’s labour market becomes increasingly dependent on immigration, the employment outcomes of immigrants will have an important role in our province’s economic growth,” says the FAO.

But even with high immigration, Ontario’s population overall continues to age. Current immigration levels can “only partially offset the projected decline in the province’s working age population.”

Despite how much we need them, though, new Canadians are being targeted as as the cause of the affordable housing crisis.

Not long ago the same accusing finger was pointed at, variously, short-term accommodations (STAs), developer indifference, and real-estate speculation.

It is true. Home prices and rents have skyrocketed. What to do?

How about back to the future? Say 50 years?

There was once a tax shelter, now long abandoned, aimed at spurring a massive construction of rental apartments. 

Between 1974 and 1982 a tax measure known as MURB — a multi-unit residential building write-off program — allowed investors to claim depreciation, and specified other costs, of a multi-unit building against unrelated income. The program encouraged the construction of nearly 200,000 new apartments at a cost of $2.4 billion in foregone taxes. 

That old-time MURB scheme certainly had its faults: inflated valuations, poor construction, no clear criteria of what affordability meant, tax shelter abuse, and an overall lack of good governance and oversight.

But surely we could address those shortcomings. Since the elimination of that MURB program in 1982, tax policy in relation to housing starts has remained largely static. Today’s tax regulations are actually less favourable to rental development by those with financial means than they have ever been.

Want affordable housing? Let the rich pay. The Canada Mortgage & Housing Corporation (CMHC) asserts “urgent action” is needed.

Admittedly, an improved MURB alone won’t solve our current housing affordability shortfall.

We need 3.5 million new homes by 2030. That is too big a task for one silver bullet.

Thankfully, municipalities like the County have made surplus lands available and created affordable housing corporations to pitch in. Queen’s Park and Ottawa have also taken positive measures.

Certainly all levels of government must expressly innovate and incentivize building.

Relying on public sector expenditures alone, though, without harnessing wealth and the private sector, is an unsustainable folly in my view.

Just maybe a new and improved MURB could be a significant component in a coordinated, public-private national strategy.

That would be infinitely more “constructive” than blaming our hard-working and much needed immigrants.

-Bill Roberts