Ontario's context

Ontario’s housing context, challenges and needs

Ontario has a very high level of housing need relative to the Canadian average, as measured through the CMHC indicator of core housing need (CHN). A household is considered to be in CHN if it is housing that is inadequate (requires major repairs), unsuitable (does not have sufficient bedrooms for the number of occupants) or unaffordable (costs more than 30% of before-tax household income) and would have to spend more than 30% of income to access alternative local housing that meets these standards. Based on Census 2021 data, of the total number of Canadian households in CHN, 44.1% of these households are in Ontario (Statistics Canada, Census of Population 2021).

While most Ontario households live in acceptable housing — housing which is affordable, does not require major repairs, and is not overcrowded — a significant minority of households continue to experience difficulty accessing acceptable housing. Housing needs are more prevalent amongst some of Ontario’s most vulnerable groups.

Housing challenges faced by Ontarians relate to affordability, supply, and the aging stock of most affordable housing:

• Affordability challenges: House prices and rents have risen much faster than household incomes, creating a widening affordability gap.
• Insufficient supply: Substantial housing construction is needed to keep up with rapid population growth and demand.
• Aging social and affordable housing stock: A large proportion of the most affordable housing (for example, rental and government-subsidized housing) is 40 years old or more and at risk of loss due to poor condition and expiring obligations to provide subsidized housing.

Housing affordability

While the proportion of households experiencing suitability and adequacy issues has remained relatively stable over the past 10 years, the proportion of households who do not live in housing that is affordable has increased (Census of Population 2011–2021). Rents and house prices have increased rapidly over this period, but incomes have not risen at the same rate.^{footnote 1[1]}

Rental housing has traditionally provided the more affordable housing option in Ontario, especially in urban areas. However, affordability of rental housing has eroded as rent growth has remained high for the past decade and has accelerated in the past few years. While the last 2 years have seen record construction of purpose-built rental, this is a recent shift after almost 3 decades of very low rental construction (CMHC).

Housing supply

Before the launch of NHS programs in 2017, no new social housing had been constructed through federal or provincial social housing programs in Ontario since 1995, although some housing providers had created units that offer below market rents to households under affordable housing programs.

As of December 2023, Service Managers (SMs) reported that an estimated 183,720 ^{footnote 2[2]} unique households were on Centralized Waitlists for social housing — rent-geared-to-income (RGI) assistance — in Ontario. In that same year, 14,079 households were able to move from the waitlists into housing (both RGI and portable housing benefits). As community housing providers’ historical operating agreements expire, mortgages mature and buildings age, there is a risk of losing community stock as providers’ original obligations end and some providers’ financial sustainability is at risk.

A key objective of NHS programs is to increase the supply of affordable rental housing through the creation of new units and the preservation of existing social and affordable housing units. In addition to its delivery of NHS programming in partnership with the federal government, Ontario has also led a number of new housing supply initiatives since the outset of the NHS to help support municipalities to build the homes Ontarians need (see Section 2 for more details).

Rental housing construction in Ontario has also lagged demand over the past two decades, contributing to tight market conditions and the need for more new rental supply. Most of Ontario’s purpose-built rental supply is now 40 years old or more — 81% of all purpose-built units were built in 1980 or earlier and over the period of 2000 to 2019, only 7.2% of all housing starts in Ontario have been purpose-built rentals.

As home ownership has become progressively more expensive, households in Ontario are increasingly renting, creating further demand for new rental supply. From 2011 to 2021, the growth in renter households (+24.1%) was more than triple the growth in owner households (+7.7%; Statistics Canada, Census of Population). Concerningly, renter households in Ontario experience much higher rates of housing need. As of 2021, 23.6% of Ontario renter households were in CHN, compared to 6.2% of owner households (Statistics Canada, Census of Population).

While Ontario continues to face housing supply issues, more recent trends have been promising as rental starts have shown increases each year for the past 10 successive years. 2023 had the highest rental starts on record and over the last 4 years (2020–2023) 16.9% of all housing starts in Ontario have been purpose-built rentals (CMHC). In addition, Ontario has also made significant progress in the repair of its community housing stock (see Section 3 for details).

Housing need and impacts on vulnerable populations

Two different measures of poverty and housing need, CHN and the Low-Income Measure-After Tax (LIM-AT), suggest that more than 10% of Ontarians fall below the threshold for each measure, with about 639,805 households in CHN and 1.4 million people below the LIM-AT (Statistics Canada, Census of Population, 2021).

As of 2021, Ontario households experienced one of the highest rates of CHN among PTs, with 12.1% of all Ontario households in CHN. The most common reason for a household to be in CHN is affordability challenges. The rate of CHN has declined more than 2 full percentage points over the past 5 years (from 15.3% in 2016). This decrease in CHN is driven largely by improvements in household incomes; however, Statistics Canada has cautioned that some of the increase in household income is due to temporary income supports during the pandemic rather than sustained increases.

As noted at the outset, another way of looking at Ontario’s high rate of CHN is by considering the provincial share of all households in CHN across the nation. When assessed this way 44% of all Canadian households in CHN reside in Ontario. This is by far the highest proportion in Canada (BC is in second place with 18%).

There are also differences in the prevalence of CHN across certain subsets of the population (for example, seniors, Indigenous people).^{footnote 3[3]}

In 2021, seniors had slightly elevated levels of CHN need overall (10.7%) compared to the overall Ontario population (9.3%). However, the percentage of seniors residing in unaffordable housing (costing 30% or more of total before-tax household income) was lower (18.4%) compared to the overall Ontario population (20%) (Statistics Canada, Census of Population 2021). That said, there is still a high prevalence of CHN among single senior households relative to the general population.

As of 2023, approximately 72,717 seniors were living in RGI social housing units, representing about 42% of all RGI social housing tenants, with approximately 73,831 seniors were on RGI wait lists. As this population continues to increase, more accessibility supports will be needed for seniors to age in place. (Source of information Service Manager Annual Information Return 2023. The information reported excludes the City of Hamilton’s data).

Individuals who identify as Indigenous living off-reserve experience higher rates of core housing need (11.3%) compared to the Ontario population overall (9.3%). These individuals experience more than twice the average rate of housing adequacy problems (14.4% vs. 5.6% overall) (Statistics Canada, Census of Population 2021). As of the 2021 Census, 16.9% of Indigenous individuals were in the LIM-AT category, almost double the rate of all Ontarians (Statistics Canada, Census of Population, 2021).

Ontario’s housing and homelessness system and program delivery

Ontario’s housing and homelessness programs are delivered locally by 47 SMs partners, and 2 Indigenous Program Administrators (IPAs) within a framework that is overseen by the province.

The Ontario government sets the overall vision and establishes the legislative and policy framework for housing and homelessness initiatives through the Housing Services Act, 2011. Within the framework, SMs identify needs in their communities, develop 10–year local housing and homelessness plans and design and deliver services to people either directly or through their partners (for example, housing providers). SMs consist of municipalities and District Social Services Administration Boards (DSSABs) that serve northern communities.

Ontario also works in partnership with its 2 IPAs to deliver housing and homelessness services (such as supportive housing) that best serve Indigenous peoples off-reserve. To do this, it engages with the IPAs on both systems planning and program design.

NHS principles and human rights-based approach to housing

Ontario’s approach to housing is aligned with the NHS principles set out under the three themes of People, Communities and Partnership. Ontario and the federal government have agreed to outcomes and targets for their shared investments that focus on eliminating or reducing housing need for many Ontario households, repairing and sustaining the existing social housing stock, and increasing the supply of community housing over time.

Ontario’s housing approach also complements the NHS goal of helping advance Canada’s obligations in relation to housing under the International Covenant on Economic, Social and Cultural Rights. The federal human rights-based approach to housing (as enshrined in the National Housing Strategy Act, 2019) represents the fulfilment of those obligations.