Short-term housing solutions are needed to accommodate the upcoming unprecedented surge in the number of new arrivals in Canada, says a new report by CIBC Economics.
The number of new international arrivals in 2023 might reach one million, it said.
“This kind of inflow suggests that existing policy tools will easily fall short of addressing the current and future increase in housing demand,” added the report.
The report said that in 2022, the actual increase in housing demand was notably stronger than official published figures suggest due to a growing share of permanent residents and non-permanent residents that arrived from outside Canada.
“Moreover, a growing pool of potential new arrivals from Ukraine and recent proposed changes to the treatment of visitor visas might work to notably increase that number in 2023,” it said.
“Any discussion regarding the housing market in Canada starts and ends with references to the growing number of new immigrants and to the government’s aggressive targets that are aimed at lifting the number of new immigrants by no less than 75% relative to pre-pandemic levels by 2025. This in an environment in which the rental market is getting tighter by the day/ However, to say that Canada will welcome 465,000 new immigrants in 2023 does not mean that net population growth due to immigration, and thus demand for housing, will rise by 465,000. To assess the impact on Canadian communities and housing, headline official Immigration Canada numbers are misleading. Rather, we need to measure international arrivals, i.e. visa issuances and arrivals for those visa recipients not already in Canada. New permanent residents that are already in Canada do not create incremental housing demand. Many permanent residents now receive their approvals from within Canada. This spiked during COVID, with 70% of permanent residents “landing” from within Canada in 2021, before falling dramatically in 2022 to about 42%.”
Together, permanent residents and NPR arrivals from outside Canada in 2022 amounted to an estimated 955,000, representing an unprecedented swing in housing demand in a single year that is currently not fully reflected in official figures, said the report.
(Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He worked for 35 years at the Calgary Herald, covering sports, crime, politics, health, faith, city and breaking news, and business. He works as well as a freelance writer for several national publications and as a consultant in communications and media relations/training. Mario was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list)
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