The Frontier Centre for Public Policy has today released Housing Affordability and the Standard of Living in Calgary, a new report authored by Wendell Cox, a senior fellow with the Frontier Centre.
Mr Cox is an expert in land use and transportation policy and the co-author of the annual Demographia International Housing Affordability Survey, which has examined metropolitan areas in Canada, Australia, Ireland, New Zealand, the United Kingdom and the United States since 2004.
In this report, Mr Cox draws on evidence from the Demographia survey, and his knowledge of the role of housing affordability in poverty reduction, to make recommendations for Calgary to address the severe deterioration in housing affordability that has occurred in the city since 2000.
Historically, Calgary was characterized by broad-based housing affordability. Until 2000, the median single-family house price was approximately 3.0 times the median household income. Over the last decade, Calgary has developed its stronger urban-containment planning regime (Plan It Calgary), and house prices have escalated strongly. The most recent data indicate that the median single-family house is approximately 4.8 times the median household income, a 60 per cent increase since 2000.
The report finds that at today’s house prices, 64,000 fewer Calgary-area households qualify for a mortgage on the average-priced house than would qualify if the house price to income ratio had remained at the same level as in 2005.
The report also recommends that the city council and surrounding jurisdictions should focus on improving the standard of living in Calgary and eradicating poverty by reforming a number of policies around housing affordability, land supply and infrastructure financing.
“Housing costs are the largest element of household budgets, so rising house prices can have a significant impact on the standard of living of the population – particularly for lower income households,” said Mr Cox.
Municipal government policies can have real and significant impacts on housing affordability and on the public’s standard of living.
“Municipal governments should commit to housing affordability as the first principle of urban planning to bring house prices back under control, and improve the standard of living for everyone in Saskatoon,” Mr Cox concluded.
View the entire study at: http://archive.fcpp.org/posts/housing-affordability-and-the-standard-of-living-in-calgary