Soaring housing costs limiting population mobility across Canada: CMHC

Canada Mortgage and Housing Corp. says high housing costs are restricting population mobility in the country, as Canadians are finding that it’s too pricey to buy or rent in cities where they seek jobs.

The federal housing agency’s analysis shows that a 1% increase of housing prices in a destination city leads to a corresponding 1% decline in the number of people moving there.

CMHC deputy chief economist Aled ab Iorwerth says the inability to move due to high housing costs is felt by both current workers and those new to the workforce, which limits skill development and reduces the economic growth of major cities.

Employers in cities with more expensive housing are subsequently forced to offer higher salaries to attract skilled workers to compensate for their cost of living, which raises business expenses and lowers productivity.

The analysis says Toronto, one of the two most expensive major cities in the country to purchase a new home, could boost its population by 3% if it doubled its housing starts over the next decade.

It says that while many attribute the lack of affordability in Toronto and Vancouver to their growing populations, data shows Calgary and Edmonton have remained relatively more affordable despite faster population growth over the past two decades, as housing supply has kept up better.

The Canadian Press

The Canadian Press is a national news agency headquartered in Toronto and founded in 1917.