A PRIMER ON
AFFORDABLE HOUSING AND
HOMELESSNESS
By: Nick Falvo
Presentation to United Church Women
Location: Barrhaven United Church
Ottawa, Ontario
February 17, 2014
Nick Falvo: United Church Women (Feb. 17, 2014)
Overview
• Government support for housing
• Social assistance
• Social housing
• Homelessness
• “Housing First”
• Summary
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Nick Falvo: United Church Women (Feb. 17, 2014)
A Well-Kept Secret
Direct Spending and Tax Expenditures
Homeowners
Private
Renters
Average subsidy
per household
Average pre-tax
household income
(2008)
$2,600
$400
$93K
$46K
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Nick Falvo: United Church Women (Feb. 17, 2014)
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Ex’s of Support to Ontario Homeowners
Type of Support
Annual Amount
Non-Taxation of
Imputed Net Rent
Non-Taxation of Capital Gains on
Principal Residences
Exemption of Imputed Rents
from GST
$2.9 B
$1.9B
$1.2B
Nick Falvo: United Church Women (Feb. 17, 2014)
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Imputed Rent
• When a landlord rents a unit to a tenant, the landlord is
taxed on that rental income.
• When a landlord (effectively) rents to her/himself, that
(imputed) rental income “is not taxed under the income
tax regime” the way “net rental income” would be taxed if
they rented to another person.
• It’s not actual rental income. Hence the term “imputed
rent.”
Nick Falvo: United Church Women (Feb. 17, 2014)
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Capital Gains on
Principal Residences
“Capital gains realized on the sale of a principal residence
are non-taxable under the income tax regime in Canada. In
comparison, 50% of capital gains from other investments
(e.g., equities) realized in a year are taxed at income tax
rates.”
— Frank Clayton
Nick Falvo: United Church Women (Feb. 17, 2014)
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The Economics of Newly-Built Housing
New Housing in Toronto
New one- or two-bedroom apt
Household Salary Needed
$1,500
$60,000
Nick Falvo: United Church Women (Feb. 17, 2014)
SA Shelter Allowance, Ottawa
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Nick Falvo: United Church Women (Feb. 17, 2014)
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SA Shelter Allowance, Ottawa (cont’d)
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Social Housing
• Social housing generally refers to housing for low-
income households that benefits from substantial funding
from senior levels of government.
• Usually, social housing is owned and operated by a not-
for-profit entity.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Social Housing (cont’d)
• A crucial point about ‘social housing’ is that a significant
proportion of tenants who live there pay reduced rent. This is
usually referred to as Rent Geared to Income (RGI).
• Though the precise rent scale varies across Canada and
across programs (and years), tenants in RGI units typically
pay between 25% and 30% of their before-tax monthly income.
• The highest amount of rent a tenant would be charged in social
housing would be ‘break even rent’—that is, the actual market
rent that would be charged on the private market. This
happens in private non-profit and co-op housing (with tenants
who are ‘middle-income’). These would not be RGI units.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Rent Levels in Social Housing Compared
Nick Falvo: United Church Women (Feb. 17, 2014)
Who Has Social Housing?
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Ottawa’s Waiting List
City of Ottawa’s Centralized Waiting List, 2012
Household Type
# of Households
Median Wait Time
(in Years)
Families
(with children)
Single Adults
Seniors
2 Adults
3+ Adults
3,665
3.1
3,543
1,965
522
150
5.4
3.2
3.6
2.9
Nick Falvo: United Church Women (Feb. 17, 2014)
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Tenants
• 1/3 of social housing tenants in Ontario are
seniors. Most prefer all-seniors buildings, and
non-profit housing authorities find them to be very
good tenants.
• 10% of Ontario’s stock of social housing is
“supportive housing.”
Nick Falvo: United Church Women (Feb. 17, 2014)
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Inadequate Housing, Children in Care
“Two studies have been done in Toronto looking at the role
of housing with respect to children in care. Results of both
studies indicate that the state of the family’s housing was a
factor in one in five cases in which a child was temporarily
admitted into care. Results from the Toronto research also
indicate that, in one in 10 cases, housing status delayed
the return home of a child from care.”
— Falvo, 2012
Nick Falvo: United Church Women (Feb. 17, 2014)
Developing
Social Housing
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Social Housing in Toronto: Basic Math
• $200K to build new unit of social housing
(including cost of land). Amount gets paid over
30 years
• $300/month (from tenant) to cover operating
deficit.
• After 30 years, major repairs necessary.
Nick Falvo: United Church Women (Feb. 17, 2014)
Social Housing in Ottawa
Cost of Building a Large One-Bedroom Apartment
(or Small Two-Bedroom Apartment)
Construction
$200/ft2
Soft Costs
An additional 10%-17%
i.e. architect, legal fees, other professionals
Land
Sometimes free
TOTAL
$200,000
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Social Housing in Ottawa (cont’d)
• It might cost less than half of that to acquire an already-
existing unit (from a private landlord, for example).
• But such a unit likely would not last as long as a newly-
built one.
• And for some types of supportive housing (i.e. for persons
with physical disabilities), housing must be purpose-built.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Land
• Centretown Citizens Ottawa Corporation (CCOC)
provides social housing in Ottawa. CCOC often pays full
market value of the land for their units.
• CCOC cannot afford to buy land in downtown Ottawa at
market rates and build new. But they can afford to
acquire already-existing units downtown.
• For example, when carrying out new construction, CCOC
could not afford to pay the full cost of land in the Market,
Centretown, Hintonburg or the main streets of Little Italy
or Chinatown.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Land (cont’d)
• Sometimes the City of Ottawa (or another level of
government) donates the land.
• Other times, a level of government will offer CCOC a long-
term lease for one dollar (or for $30,000 or $40,000 a
year).
Nick Falvo: United Church Women (Feb. 17, 2014)
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Land (cont’d)
• Government funding cycles make it challenging for non-
profit housing providers to ‘jump on’ good land
opportunities.
• City of Ottawa might issue an RFP in July and then
announce results in November.
• But there might be a great deal on land in June; and
owner of the land will not wait. Seller wants to close in
three months.
Nick Falvo: United Church Women (Feb. 17, 2014)
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New Social Housing in
Ottawa
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Examples of AHI Projects in Ottawa
Provider
Address
# of Units
Year Completed
Ottawa Salus
930-934 Gladstone
19
2002
Ottawa
Community
Housing
380 Somerset W
(Hartman’s)
60
2005
Multifaith Housing 138 Somerset
Initiative
10
2007
CCOC
424 Metcalfe (Beaver
Barracks – Phase I)
160
2010
Shepherds of
Good Hope
1053-1057 Merivale
(“The Oaks”)
55
2011
Nick Falvo: United Church Women (Feb. 17, 2014)
Beaver Barracks
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Nick Falvo: United Church Women (Feb. 17, 2014)
Beaver Barracks (cont’d)
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Nick Falvo: United Church Women (Feb. 17, 2014)
Beaver Barracks (cont’d)
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Nick Falvo: United Church Women (Feb. 17, 2014)
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Shepherds of Good Hope (“The Oaks”)
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Ex’s of New AHI Coop Units in Ottawa
Provider
Address
# of Units
Completed
Blue Heron Co-operative
Homes
750 March Road
83
2006
McLean Cooperative
Homes
155-343 Parkin Circle
63
2008
Eastern Ontario Christian
Seniors Co-op
220 Viewmount
Crescent
69
2012
Nick Falvo: United Church Women (Feb. 17, 2014)
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Blue Heron Housing Co-operative
Nick Falvo: United Church Women (Feb. 17, 2014)
MacLean Co-operative Homes
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Eastern Ontario Christian Seniors Co-op
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But Where Does This
Leave Us?
Nick Falvo: United Church Women (Feb. 17, 2014)
Canada Compared
Rates of Social Renting
Country
%
Netherlands
34
Sweden
32
France
19
England
18
Canada
5
United States
3
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Nick Falvo: United Church Women (Feb. 17, 2014)
Rental Housing Production
Rental Production in Canada:
Annual Average by 5-year Period
120,000
Non-Profit & Co-op
3,
70
0
Private Rental
9,
00
0
2,
20
0
32,900
39,700
18,200
24,900
11,200
0
50-54
55-59
60-64
65-69
70-74
75-79
80-84
85-89
90-94
14,200
14,200
6,200
95-99
Source: Greg Suttor- Canadian Housing Statistics; ONPHA; AHI data.
4,
10
0
59,100
56,700
00
19
,6
00
0
50
1,
20,000
75,200
72,200
1,
4
00
40,000
16
,1
00
6
1,
20
,0
00
0
40
9,
0
40
1,
60,000
Public Housing
00
,5
17
0
40
9,
80,000
1,
90
0
100,000
00-04
05-09
Nick Falvo: United Church Women (Feb. 17, 2014)
Homelessness
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Nick Falvo: United Church Women (Feb. 17, 2014)
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Causes
Traditionally, two schools of thought:
1. Individual risk factors
2. Socioeconomic factors affecting entire
jurisdictions
Nick Falvo: United Church Women (Feb. 17, 2014)
Causes (cont’d)
Ex’s of Individual Risk Factors:
• Mental health diagnosis
• Heavy use of drugs or alcohol
• Lack of education/skills
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Nick Falvo: United Church Women (Feb. 17, 2014)
Causes (cont’d)
Examples of Socioeconomic Factors Affecting Entire
Jurisdictions
• High unemployment rate
• Lack of affordable housing
• Inadequate social assistance benefits
• Reductions in psychiatric beds
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Causes (cont’d)
Since early 1990s: convergence of opinions
1. Structural factors matter
2. Those most at risk tend to have individual
risk factors
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Impact on Health
“Homeless people in their forties and fifties often develop
health disabilities that are more commonly seen only in
people who are decades older.”
—Dr. Stephen Hwang
Nick Falvo: United Church Women (Feb. 17, 2014)
Impact on Health (cont’d)
• Homeless people more likely to have:
29X Hep C
20X Epilepsy
5X
Heart Disease
4X
Cancer
2X
Diabetes
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Nick Falvo: United Church Women (Feb. 17, 2014)
Mental Health
• Depression 17% (8% in pop)
• Anxiety 11%
• Bipolar 8%
(1%)
(1%)
• Schizophrenia 5% (1%)
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Social Costs (cont’d)
• 2000 article in JAMA reported on death rates
among homeless men in Toronto:
→The mean age of death was 46 years.
→The mortality rate for homeless male youth 8X
rate of of their non-homeless counterparts.
→Homeless men 9X more likely to be murdered
than their housed counterparts.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Social Costs (cont’d)
• 1998 Toronto study
→ Over half of all female street youth become pregnant.
→300 babies are born to homeless women each year in
Toronto
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Violence
• More than 1/3 of homeless persons report being
physically assaulted or beaten up in previous year
• Stranger 56%
• Acquaintance 38%
• Police 35%
• Another shelter resident 27%
• Partner or spouse 21%
• Shelter staff 15%
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Sexual Violence
• 1 in 5 homeless women report being sexually
assaulted or raped in previous year.
Nick Falvo: United Church Women (Feb. 17, 2014)
“Housing First”
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Throne Speech, 2013
• “Our Government will…[b]uild on the successful
Housing First approach and its renewed
Homelessness Partnering Strategy to help house
vulnerable Canadians…”
— Throne Speech (Canada), Oct. 2013
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Housing First
My Definition (for the purpose of today’s class)
Providing a homeless person with immediate
access to permanent housing.
The alternative to Housing First: the “treatment first”
approach (also known as the “continuum of care”
approach)—i.e. fix person’s behaviour (i.e. addictions,
mental health, etc.) before giving them permanent housing.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Difference between HF and Treatment First
Based on slide from S.Tsemberis
Housing First
No requirement for readiness to
move directly to permanent
housing
Permanent
housing
Transitional
housing
Shelter
placement
Homeless
Treatment First
Client must demonstrate
readiness for each step
Nick Falvo: United Church Women (Feb. 17, 2014)
At Home/Chez Soi Study
• 5-city, random control study
• $110 million
• Results expected imminently
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Summary
• Senior levels of government in Canada provide various
forms of support for housing, including for homeowners.
• Social assistance (i.e. ‘welfare’) provides assistance to
many low-income Canadians, but, for the most part, not
enough for appropriate private-rental accommodation.
• Fewer than half of very low-income Canadians are
fortunate enough to live in “social housing” (which
involves subsidized rent levels).
Nick Falvo: United Church Women (Feb. 17, 2014)
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Summary (cont’d)
• Indeed, there are lengthy waiting lists for social housing
all across Canada.
• The percentage of Canadian households who live in
social housing is considerably lower than the OECD
average.
• Canada’s rate of ‘social renting’ is 5%. In The
Netherlands, the rate is 34%. In Sweden, it’s 32%.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Summary (cont’d)
• People who are homeless (i.e. sleeping in emergency
shelters or outside) experience certain health problems at
much higher rates than the general population.
• They also die much more quickly.
• They are also considerably more likely to be assaulted
(both physically and sexually).
Nick Falvo: United Church Women (Feb. 17, 2014)
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Summary (cont’d)
• Over the past decade, it has become quite trendy for
senior levels of government in Canada to claim that they
believe in the Housing First principle.
• In other words, they state that they hold the philosophical
view that homeless persons should be given immediate
access to affordable housing.
• Note: This is not the same thing as agreeing to provide
sufficient funding for every homeless person to live in
affordable housing.
Nick Falvo: United Church Women (Feb. 17, 2014)
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Summary (cont’d)
• Results of the At Home/Chez Soi study will be released
later this year.
• Some people believe that these results will make it more
palatable for senior levels of government to provide more
resources so that homeless persons can be provided with
more affordable housing.
Nick Falvo: United Church Women (Feb. 17, 2014)
Thank You
Nick Falvo
PhD Candidate (Public Policy)
Carleton University
falvo.nicholas@gmail.com
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