By Tim Querengesser
Boomtown’s burst popped by housing bust
Recently, I realized how truly desperate Ottawa’s rental housing market is. A man offered me $550 per month, over $100 more than the asking price, to rent my twelve-by-seven foot space — for his wife and himself, over the telephone, sight unseen.
Statistics from various groups watching the market further illustrate the problem.
For one, there are literally no apartments vacant in Ottawa. For every 1,000 apartment units, only seven are vacant. That’s because only 144 apartment units were built in the entire region of Ottawa-Carleton in 1999. Of these, none were priced under $840 per month, the benchmark the region considers “affordable.”
With provincial housing subsidies cut in the mid ‘90’s, it doesn’t make sense to build rental housing any more. There’s no money to be made. That’s why since 1995, there’s been no new rental developments in Centretown.
It’s much more profitable to build for the buyer’s market, dominated by those well-paid high-tech professionals who are multiplying faster than rabbits. Judging by the lineups at every apartment with a “for rent” sign this summer, the shortage is having a profound effect.
Rent controls on vacant units have been abandoned. So now renters are being thrown into a brutally tight housing market where vacant units are worth their weight in gold. Landlords can charge whatever the market will bear. Many units have jumped up in price, and those who can’t afford the higher fees are out of luck.
“Even though they’re not getting paid dot.com salaries,” says Catherine Boucher, executive co-ordinator at the Centretown Citizens Ottawa Corporation, “they’re competing with dot.com people for housing.”
Ottawa may be Silicon Valley North, but it’s also home to two large universities, and a college. Where are the students going to live? If the problem is bad now, imagine it in three years. That’s when two years of high school students graduating in the same year arrives on Ottawa’s doorstep.
The city is trying to help, but it can’t fix the lack of funding from the province. They’ve tried tax initiatives and breaks on zoning for rental housing developments, but this isn’t enough.
While we enjoy tax cuts and a vibrant economy, subsidies for housing have disappeared. If we want the boom in Ottawa to continue, we need to make room for everyone. We need affordable places to live, not just yuppie condominiums with triple digit price-tags. We need to attract talented people to Ottawa, not scare them away with Canada’s lowest vacancy rate. We need to have landlords compete for our business, not have tenants fighting over grossly over priced apartments.
Bring back the funding, Mike Harris, or you’ll have to look for somewhere new to live yourself.