New homes are constructed in Ottawa in August, 2023.Sean Kilpatrick/The Canadian Press
An international survey released earlier this year measured a sharp drop-off in the happiness of Canadian youth but did not reveal the cause, making the finding a screen onto which anyone could project their pet theory. Maybe it was social media, or student debts or a dread of climate change.
A follow-up report shows that the most obvious explanation was the right one: young people can’t afford homes.
Economic stress accounted for half of a steep decline in happiness among Canadian youth between 2008 and 2025. And housing affordability was the biggest factor in that.
Politicians should not be complacent about this. A widening happiness gap between younger and older Canadians – who report significantly higher levels of contentment – is a political storm waiting to erupt. Governments that fail to take this seriously will eventually face wrath at the ballot box.
Editorial: Ottawa builds its housing plan on shifting sands
Also, quite apart from political self-interest, a dose of compassion is in order. The kids are clearly not all right. Although Canada’s motto does not promise happiness, as is the case to the south, the well-being of citizens must be a top concern of government. And that includes their mental well-being.
Unfortunately, debates over how youth are doing too often devolve into crude stereotypes about kids being too demanding or not wanting to work hard. This ignores that the job market is brutal now for youth. And the reality of buying a home is simply different than it was a generation or two ago.
The relationship between income and housing costs has widened so dramatically that saving for a down payment on the average income would take around 16 years in Vancouver and 15 in Toronto. Prices have also gone up dramatically in smaller cities that once served as cheaper places to enter the housing ladder.
A recent drop in home prices was not enough to make them affordable for many people. And it has prompted a slowdown in construction, laying the groundwork for greater housing shortages down the road. Meanwhile, rents have softened but remain stubbornly high.
Canada’s housing crisis has created a happiness crisis
There are policy solutions that can help.
This space has argued for reductions in development charges. These are fees, levied primarily in Ontario and British Columbia, on new homes. They are ostensibly to fund the cost of providing infrastructure to those new homes but are routinely used to keep taxes low for existing home-owners. They can add more than $100,000 to the price of a home.
It’s good that the federal and Ontario governments have moved together to reduce these fees. British Columbia has made a nod in this direction by allowing some of these fees to be deferred, but should strike a similar deal with Ottawa.
All levels of governments also need to make it easier to build. That can be done through reducing red tape, by making it simple and straightforward to get permits and by changing zoning rules to allow more types of homes.
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The federal government had been making progress on zoning reform through its Housing Accelerator Fund. Money from this fund went to cities that made it easier to build, including by allowing small multiple-unit buildings in areas traditionally reserved for single-family homes. Unfortunately, Ottawa has made clear it is unwilling to hold cities to their commitments. A stiffer backbone is required.
A home is not only a house, of course. In major cities, the proportion of people who rent is gradually climbing. More than half of residents in Vancouver and Montreal are tenants and nearly 50 per cent of Toronto households rent. It’s a cultural shift that will make home ownership increasingly not the default reality of adulthood. Many young people who rent now will be lifelong tenants.
Some cities have waived development fees on purpose-built rental buildings, which is a good idea. However, to make apartment dwelling better suited for people as they marry and have children, cities need to encourage larger units. Years of investor-driven condo development have left a glut of very small units.
As well, cities need to remember that well-thought-out public space is even more important to people without backyards. Parks, squares, waterfronts and spacious sidewalks are crucial to urban living.
Not everyone will buy a home, and there need to be good options available for them. But for those who do want to buy, the prospect should not feel unattainable. Because unhappiness will breed desperation – and eventually anger.