Canada's leadership and housing affordability: Evidence from the Canadian real estate market

Abstract

This study aims to investigate the housing affordability crisis and if Canada's political leadership is part of the problem or part of the solution. Convergent parallel design was conducted to understand a research problem. Quantitative and qualitative data was collected to examine the research argument and to answer the research questions of who benefits from the existing housing situation and how the situation influences young Canadians. The results show that both government and bankers benefit from the existing shortage of residential property. While bankers work in their arena with the incentive to generate income and increase profit through facilitating mortgages, Canada's leadership at all levels regulates the real estate market with no incentive to improve the existing shortage. Offering affordable homes for Canadians is a government responsibility, but one that conflicts with other governments interests. Affordable houses require more focus on the supply side of the market to reduce the shortage, which conflicts with government's goal of generating more tax revenue since property tax is linked directly to real estate market prices. The study results show that Canada's leadership potential conflict of interest cannot be ignored and the challenge of high residential property prices creates a problem of brain drain among young Canadians. The Canadian government needs to work to increase the supply of residential property through new policies that encourage development and investment in new home construction. Canada, as the second largest country in the world by area, can mitigate this problem if the government were generous in offering lands for new development programs and removing current restrictions.