Study shows that 45% of Hamilton renters live in unaffordable housing
- Oluseyi Olomodosi
- 03 Dec 2019
Over the next few weeks the Social Planning and Research Council of Hamilton (SPRC) will be publishing documents on the rental housing crisis in Hamilton. According to the initial reports they’ve released, 45% of Hamilton’s renters live in unaffordable housing and use disproportionate amounts of their income for shelter.
The SPRC is a Hamilton non-profit that aims to improve Hamiltonians’ quality of life through research and community development, service, and engagement. The initial reports are part of a 15-part series that outlines the city’s current rental landscape.
The crux of the findings they’ve released so far is that Hamilton’s rental prices are rising at a rate that residents can’t keep up with. As the price of rent increases quickly, renters end up spending a greater portion of their income on housing and having less left for other necessities such as food, clothing, and education, as well as leisurely pursuits like entertainment.
It is worth noting that the problem extends beyond Hamilton and seems to be part of a wider trend of growing financial insecurity. Feed Ontario’s annual hunger report, which was published this week, reports a province-wide increase in the number of individuals accessing food banks since 2018.
According to the report, 1 in 10 Ontarians cannot afford a basic standard of living. This includes a “concerning” number of people with full or part-time employment. The past year saw a 27% increase in the number of employed individuals who accessed Ontario food banks.
5,000 children are visiting Hamilton food banks a month — and the number is growing because families are using more than half of their income on housing.
This is heartbreaking.
Housing is a human right—everyone deserves affordable housing. https://t.co/aZKGyEMKBm
— Andrea Horwath (@AndreaHorwath) November 13, 2019
The Hamilton region was one of the regions with the greatest discrepancy between the amount required to afford a basic standard of living, and the average income of those accessing food banks, even when government assistance was taken into account. One of the biggest reasons for this is the lack of affordable housing.
While increases in local property value come with significant benefits in terms of investment and attracting new businesses and young professionals, it also comes with significant downsides that are worth addressing.
The influx of outside business, investment, and home buyers undoubtedly brings a lot of value to the city, kickstarting both economic and development, but unfortunately, it can also come at the expense of some of Hamilton’s existing residents.
Since 2015, rental prices in the region have been growing exponentially. Based on data from the Canada Mortgage and Housing Corporation, the SPRC says that from 2015-2018 Hamilton’s rental prices rose at a rate 3.5 times higher than inflation. This has lead to a difference of approximately $125/month between the average cost of Hamilton rent and what the average cost would be if rental price increases were in line with inflation.
This figure actually understates the issue, according to the SPRC, as it takes into account the prices paid by current renters. The price of rent in available units is likely much higher, meaning those hoping to rent in Hamilton today would be looking at an even bigger gap.
As rent increases for existing units and higher quality, more expensive units are built, rental prices continue to skyrocket at a rate above the provincial average. This is compounded by the fact that eviction notices for reasons other than non-payment of rent have more than doubled. A large number of these evictions are due to renovations done to turn existing units into more expensive, higher quality ones.
Because current market prices for units are significantly higher than they were in the past, and because they continue to increase, any residents who move elsewhere in the city – either by choice or by eviction – are likely to end up having to pay significantly more than their previous rent, or downgrade in order to mitigate the cost.
These types of evictions are highest in some of Hamilton’s most affordable areas, such as Corktown and Stinson. When people move out, it allows these affordable prices to continually increase and eventually lose their affordability. This compounds the problem.
Because wage increases haven’t kept up with rental price increases, Hamiltonians are needing to pay a bigger part of their income for shelter. The SPRC’s report says that 45.4% of Hamilton’s renters live in unaffordable housing. This means that they spend around 30% of their income on housing costs. 20% of Hamilton’s renters spend half of their income or more on housing.
Despite Hamilton’s pasty reputation as being less expensive to live in than other places, the report paints a picture of a concerning level of unaffordability. One reason for the gap between perception and fact is that Hamilton’s housing market is often looked at through a Toronto lens.
Even though Hamilton’s rental costs are lower than Toronto’s, unaffordability also takes into account other factors such as income. When looked at from this perspective, Hamilton’s unaffordability problem is very real and no better than the provincial average.
Beyond financial burden, the city’s unaffordable housing landscape also creates a lot of practical problems for residents. For instance, an individual might get a better job on the other side of the city but be unable to move because the cost of rent is prohibitive.
If the commute is too burdensome, this limits their ability to earn more income, advance in their careers, and ideally be able to afford better rent. It leads to situations where people end up stuck in their current positions or, far too often, stuck in declining situations they can’t do much about.
The SPRC report references a study from the Canadian Centre for Policy Alternatives, which shows that someone earning minimum wage would have to work 54 hours a week to afford a one-bedroom apartment in Hamilton.
The remaining SPRC bulletins will focus on impacts to renters and the difficulties they face, as well as the buildings that they live in.
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