Skip to main content
opinion

In late December, economists at National Bank Financial pointed out Canada’s expected population increase of more than 400,000 in 2021 will exceed population growth in the United States, a country nine times larger, for the first time ever.Sean Kilpatrick/The Canadian Press

In the years before the First World War – when Canada’s population surged to nearly eight million – immigration climbed to record levels. It peaked in 1913 at 400,900.

More than a century later, the country is poised to set new immigration records. Canada was on track to hit the Liberal government’s target of 401,000 in 2021. The aim is for 411,000 in 2022 and 421,000 in 2023.

This new surge is in part to make up for the pandemic year of 2020, when arrivals dropped to just 184,000, the lowest since the late 1990s. But the upward trend line stretches back to the late 1980s, first under the Progressive Conservatives, then Liberals, Conservatives and Liberals again. It is now supercharged.

Canada’s next wave of immigration set to add more fuel to overheated housing market

Immigration will help Canada build back better, but only if the country has all hands on deck

The policy of high and rising immigration is centred on the economy. The goal is to bolster current and future growth in the face of an aging population and low birth rates. But amid an emphasis on the benefits of immigration, what’s missing from the discussion is how to shoulder the main challenge a rapidly expanding population brings: namely, the demand for housing.

Population growth moves at the speed of a glacier. Looked at day to day its effect goes unseen, but over time it is like compound interest: inexorable and enormous. Canada’s population statistics bear this out. Pull back the lens to 2015. Canada has added another Metro Vancouver since Prime Minister Justin Trudeau’s Liberals won government. Canada’s population was 35.7 million then; by 2021, it was 38.3 million. That’s 2.6 million more people in six years.

In 2019, Statistics Canada reported that the country’s population growth rate, on a percentage basis, was the highest among the Group of Seven. Now, Canada’s growth – on an absolute basis – is the highest in the G7. In late December, economists at National Bank Financial pointed out Canada’s expected population increase of more than 400,000 in 2021 will exceed population growth in the United States, a country nine times larger, for the first time ever.

In the annual report to Parliament on immigration, questions of housing supply – or urban planning, or the adequacy of new public transit – are not even part of the discussion. Yet the bulk of newcomers to Canada settle in the country’s biggest cities, where housing is especially stretched.

After a wild housing market through the pandemic, the pressures pushing prices higher, and making urban homes scarce, are unlikely to wane. In 2020, prices spiked even though immigration was temporarily low because of the pandemic squeeze; what will the future bring, given the consistently rising population expected in the years to come? And that higher housing demand from immigration will land on top of existing strains in the market, from the low supply of units to buy or rent, to the steady underbuilding of recent decades.

As Canada pursues record immigration, the country has to explicitly plan to meet the challenges. We won’t reap the full benefits unless we do so. But the system for addressing all of this is fractured. Ottawa sets immigration targets yet new housing supply is dictated – and too often stymied – by municipal zoning.

Canada could welcome more than four million immigrants in the 2020s. That’s another Alberta. Greater urban housing density – which is the main solution – will become ever more essential to provide homes to current and future Canadians, in the places where the jobs are. Such density must be accompanied by major investments in transit. Canada’s long history of sprawl was never good planning. And as more people come, endless sprawl can’t be the answer.

The new federal cabinet includes a housing minister for the first time in three decades. In the housing mandate letter, there are calls to quell speculative demand (a temporary ban on foreign investors) and to increase supply (a $4-billion plan to build more housing in cities). Ottawa also wants to “help ensure a more stable Canadian housing market.” The current situation is the opposite: During the pandemic, the average home price shot up more than 30 per cent.

Ottawa is convening a so-called national housing supply summit later this year, bringing together the feds and the cities. It’s a start. For too long, a policy of population growth has been disconnected from all discussion of housing that growing population. For too long, there has been a little – or no – co-ordination. Housing policy has to catch up to immigration reality.

Keep your Opinions sharp and informed. Get the Opinion newsletter. Sign up today.