Policy Shifts and Crown Land Reforms: A Pathway to Alleviating Canada’s Housing Crisis
Crown lands which constitutes about 89% of Canada’s landmass, holds significant potential to alleviate the housing shortage.
Canada’s housing crisis has reached critical levels, with escalating property prices, an acute shortage of affordable housing, and rising homelessness. Among the myriad of factors contributing to this crisis is the underutilization and mismanagement of Crown land. Crown land, which constitutes about 89% of Canada’s landmass, holds significant potential to alleviate the housing shortage. However, current policies surrounding Crown land are restrictive and often counterproductive. This article explores the necessary policy shifts and Crown land reforms required to address Canada’s housing crisis effectively, with a focus on how these reforms can reduce housing prices.
The Current State of the Housing Crisis in Canada
Canada's housing market has experienced unprecedented growth over the past two decades. As of 2023, the average home price in Canada was over $700,000, with cities like Toronto and Vancouver seeing averages exceeding $1 million . This surge in prices has far outpaced wage growth, making homeownership increasingly unattainable for many Canadians. Additionally, rental prices have also soared, with major urban centers witnessing double-digit percentage increases annually .
Several factors contribute to this crisis:
Crown Land: An Untapped Resource
Crown land in Canada is owned by the federal and provincial governments and constitutes approximately 89% of the country’s total land area, with 41% managed federally and 48% provincially. The majority of this land is located in rural and remote areas, but significant portions exist within or near urban centers where housing demand is most acute.
Potential of Crown Land for Housing
Policy Shifts Needed for Effective Crown Land Reform
1. Decentralization and Devolution of Control
One of the primary challenges in utilizing Crown land for housing is the centralized control exerted by federal and provincial governments. To unlock the potential of Crown land, there needs to be a decentralization of control, allowing local municipalities greater authority in decision-making. This would enable local governments to address housing shortages based on their specific needs and circumstances.
Case Study: Norway’s Decentralized Land Management
Norway has implemented a successful model of decentralized land management, where local municipalities have significant control over land use decisions. This approach has led to more efficient and responsive housing policies tailored to local needs .
2. Land Transfer Programs
To expedite the development of Crown land, the federal and provincial governments should establish land transfer programs that transfer underutilized Crown land to municipalities, non-profit organizations, and Indigenous communities for housing development. This would not only increase the supply of affordable housing but also empower local communities to take an active role in solving the housing crisis.
Indigenous Land Claims and Housing
Indigenous communities across Canada have long advocated for the return of traditional lands. Transferring Crown land to Indigenous communities for housing development could serve a dual purpose: addressing historical grievances and alleviating housing shortages .
3. Public-Private Partnerships
Reforming Crown land policies to encourage public-private partnerships (PPPs) can attract private investment into affordable housing projects. Governments could offer incentives such as long-term leases, tax breaks, or low-interest loans to private developers in exchange for a commitment to build affordable housing on Crown land.
Example: Singapore’s Public Housing Model
Singapore’s public housing system is a successful example of how government land can be used in collaboration with private developers to provide affordable housing. Approximately 80% of Singapore’s population lives in public housing, which is built on government-owned land through PPPs .
4. Zoning and Regulatory Reforms
Current zoning laws and regulatory frameworks often restrict the development of Crown land for residential purposes. There needs to be a comprehensive review and reform of these laws to facilitate the development of affordable housing on Crown land. This could include relaxing zoning restrictions, streamlining the approval process, and reducing bureaucratic red tape.
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Case Study: Vancouver’s Housing Crisis
Vancouver’s restrictive zoning laws have been a significant factor in its housing crisis. Recent efforts to relax these laws, particularly in areas near transit hubs, have shown promise in increasing housing supply and reducing prices .
5. Indigenous Rights and Crown Land Use
A significant portion of Crown land overlaps with traditional Indigenous territories. Any policy shifts must prioritize Indigenous rights, ensuring that land use decisions are made in partnership with Indigenous communities. This would involve respecting treaty rights, engaging in meaningful consultation, and providing opportunities for Indigenous-led housing developments on Crown land.
Truth and Reconciliation Commission Recommendations
The Truth and Reconciliation Commission of Canada has emphasized the need for a renewed relationship between Indigenous peoples and the Canadian government, including in matters of land use. Implementing these recommendations could help address the housing needs of Indigenous communities while respecting their rights .
Economic and Social Impact of Crown Land Reforms
1. Reduction in Housing Prices
By increasing the supply of land available for residential development, Crown land reforms can directly contribute to lowering housing prices. An influx of new housing units, particularly affordable ones, would ease the demand pressure currently driving up prices.
Economic Modeling and Projections
Economic models suggest that a 10% increase in land availability for housing could reduce home prices by up to 5% in high-demand urban areas . This could make homeownership more attainable for a broader segment of the population.
2. Economic Stimulus
Developing Crown land for housing would also act as an economic stimulus, creating jobs in construction, real estate, and related industries. The increased economic activity would generate additional tax revenue for governments, which could be reinvested in further housing initiatives.
Case Study: Australia’s Land Release Program
Australia’s land release program, which made government-owned land available for development, resulted in significant economic benefits, including job creation and increased tax revenue .
3. Social Equity and Inclusion
Utilizing Crown land for affordable housing can help address social inequalities by providing housing opportunities to marginalized communities, including low-income families, Indigenous peoples, and new immigrants. This would contribute to more inclusive and equitable urban development.
Affordable Housing in Toronto
Toronto’s recent initiatives to develop affordable housing on city-owned land have been instrumental in providing housing for low-income residents, demonstrating the potential social benefits of similar reforms at the federal and provincial levels .
Conclusion
Canada's housing crisis is a complex and multifaceted issue that requires bold and innovative solutions. Reforming Crown land policies represents a significant opportunity to address this crisis by unlocking vast amounts of underutilized land for residential development. By decentralizing control, establishing land transfer programs, fostering public-private partnerships, reforming zoning laws, and prioritizing Indigenous rights, Canada can significantly increase its housing supply, reduce prices, and create more inclusive communities.
The implementation of these reforms will require strong political will, intergovernmental cooperation, and the active participation of all stakeholders, including Indigenous communities, private developers, and local governments. However, the potential benefits—more affordable housing, reduced prices, economic growth, and greater social equity—make this a critical avenue for addressing Canada’s housing crisis.
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Modular Housing Evangelist | Ecosystem enabler | ex-CMHC innovation & partnerships advisor | Fractional advisor | Proud generalist | Perpetually curious
4moGood article Ali Salman. Canada has so much land, although much of it either undeveloped or poorly suited to development. The cost of infrastructure development is steep and mainly justifiable through long term investments in economic development. Charging it all as upfront charge on developers or as downstream residential property taxes is unviable. Such a wicked problem. It’s like we are in an ocean and dying of thirst.