As the Canadian real estate market experiences an unprecedented surge, the dream of homeownership has become increasingly unattainable for a larger portion of the population. Habitat for Humanity, a renowned charity that has long been associated with helping low-income families achieve their homeownership dreams, is witnessing a significant shift in the demographic it serves. In response to soaring home prices and growing affordability challenges, Habitat for Humanity is now stepping in to support higher-income Canadians, including those earning about $100,000 annually. This change reflects the escalating housing crisis in Canada and the urgent need for innovative solutions. In this blog, we explore how Habitat for Humanity is adapting to the changing landscape and the broader implications of unaffordable housing.

For nearly four decades, Habitat for Humanity has been a beacon of hope for low-income families, offering no-interest loans to help them purchase homes and build better futures. However, the organization has seen a remarkable shift in its client base as the average home price in Canada has surged by a staggering 40 percent in just five years. Traditional middle-income earners are now among those struggling to afford homeownership, creating a new challenge for Habitat for Humanity.

The real estate market’s rapid inflation has had far-reaching consequences, with homes in major cities like Vancouver and Toronto surpassing the $1-million mark. Even in other regions of southern Ontario, property prices have crept dangerously close to this threshold, effectively excluding many from the housing market.

Toronto, Canada’s second-priciest real estate market, is emblematic of this crisis. The typical home price has surged 53 percent in the last five years, reaching an eye-watering $1,171,300. To keep pace with these skyrocketing prices, the income required to qualify for a Habitat for Humanity no-interest loan has dramatically increased.

To accommodate the changing landscape, Habitat for Humanity has adjusted its assistance criteria. Previously, the charity served families primarily from the services sector, including retail employees. Now, it extends support to residents with higher-paying jobs in the medical field, government, and other professions. This shift allows a broader range of Canadians to access the organization’s much-needed aid.

With the rising costs of homes, the size of Habitat’s loans and bank mortgages in the Toronto region has expanded accordingly. In 2022, the average mortgage was $809,363, compared to $437,959 in 2018. This change demonstrates the immense strain that unaffordable housing places on the housing system.

The unaffordable housing crisis is not limited to major cities like Toronto and Vancouver. Even in cities like Edmonton, where home prices are relatively lower, prospective homeowners are grappling with the escalating costs of daily necessities, making it increasingly difficult to save for a down payment.

While organizations like Habitat for Humanity and Options For Homes play vital roles in aiding households to secure affordable housing, their efforts alone cannot resolve the housing crisis. Collaborative efforts from government bodies, private sector stakeholders, and nonprofits are essential to find sustainable solutions.

The repercussions of unaffordable housing extend far beyond individual families. As the cost of living rises faster than wages, middle and lower-income households face significant financial stress, leaving them with little to no savings. This loss of stability and security has societal implications, hindering individual potential and hampering community and national development.

Habitat for Humanity’s shift in assisting higher-income Canadians reflects the alarming reality of the Canadian housing market’s affordability crisis. With home prices soaring and housing becoming increasingly out of reach for many, collaborative efforts and innovative solutions are necessary to address this urgent issue. By working together, we can strive towards creating a more inclusive and affordable housing landscape that empowers all Canadians to achieve their dream of homeownership and secure a brighter future for themselves and their communities.