policies » Ren Thomas

Segregated or integrated? American and Canadian ethnic populations

Bill Rankin's map of Chicago

A couple of years ago, when I attended the Association of Collegiate Schools of Planning annual conference in Chicago, I was stunned to hear that Cleveland and Chicago are the most segregated cities in the US. As I’ve written before, Canadian cities simply don’t have these levels of segregation; obviously not for African American and Hispanic populations, but also not for other groups. Recently, I’ve come across a series of maps illustrating the difference between American cities that are more segregated vs. more integrated, thanks to some enlightened cartographers. It is very interesting to compare these maps to the (albeit simpler) maps of visible minorities in Canadian cities recently published by the Globe and Mail.

Bill Rankin‘s map of Chicago illustrates the sharp divides between white, black, Asian, Hispanic, and other ethnocultural groups. It was originally published in Perspecta, the journal of the Yale School of Architecture; Rankin is a PhD candidate in architecture and the history of science.

After seeing this, Eric Fischer produced similar maps for the 40 largest American cities. He used the same process as Rankin (one dot for every 25 people and same colour code, using the 2000 Census data).

We can see some segregation in New York City, but there are zones of integration.

Eric Fischer's map of New York City

Detroit’s 8-Mile district stands out as an example of entrenched segregation. Many of the maps of smaller cities, like Buffalo, Toledo, and Raleigh, highlight inner city concentrations of African Americans.

: Eric Fischer’s map of Detroit

Eric Fischer's map of Los Angeles

On the other hand, check out Riverside, CA, which looks very integrated. Los Angeles also has a lot of integration, and San Antonio is very integrated.

Eric Fischer's map of Riverside

A couple of weeks ago, the Globe and Mail posted a series of “heat maps” showing the concentration of visible minorities in Canadian cities. They don’t break down the statistics (from the 2006 Census) into specific ethnocultural groups, as is the usual Canadian trend; there are simply too many groups to map. But they are interesting nonetheless. The maps are interactive, allowing you to zoom in, so I can’t reproduce them here. Check them out at www.globeandmail.ca under Multiculturalism.

Vancouver’s map shows that in most census tracts in Vancouver, Burnaby, Richmond and Surrey, over 30% of the population are visible minorities. Toronto has a similar pattern: over 30% of the population in Toronto, Brampton, Mississauga, Richmond, and Ajax are visible minorities. The central Toronto map shows some interesting areas of lower concentration: areas around the subway lines, west Toronto and the Beaches. In Calgary, Winnipeg and Ottawa, the census tracts with over 30% visible minorities are mainly in the suburbs.

Montréal is even more fascinating because it shows a very different pattern. The visible minority population there is almost exclusively concentrated on the island of Montréal, with lower rates of concentration in the suburbs: the older pattern of immigrant settlement that we still see in smaller cities. This is likely due to sheer numbers: Toronto and Vancouver receive tens of thousands more immigrants each year than Montréal.

Obviously, the American maps show that not all cities south of the border are sharply segregated, but even in the smaller cities, like Toledo, Ohio, there are lingering segregated African American populations. This in itself is not an issue; the maps of Canadian cities show lots of neighbourhoods with high concentrations of visible minorities. The real issue is when these concentrations are due to poverty or discrimination (either societal or institutional, such as in the housing market). American housing research seems to indicate that much of the segregation is in fact due to these two factors. Entire programs are devoted to fixing this problem: Housing Choice Vouchers, for example, aim to remove people from entrenched areas of poverty into neighbourhoods where they may have better educational and job opportunities.

I think these maps illustrate again how different Canadian and American cities are in terms of ethnocultural groups: both in terms of their composition and their spatial dispersal. This continues to create policy differences between the US and Canada, not only in my own research areas of housing, transportation, and immigration, but in many other areas affecting municipalities: welfare provision, health care, and education to name a few.

Toronto’s “class divide”

Many researchers in Toronto have become experts at mapping the city’s spatial, cultural, ethnic, and political trends. A few years ago, the Globe and Mail even published a language map of Toronto based on the 2001 Census data for mother tongue. Richard Florida is now one of the latest to use the excellent mapping and research resources available at the Centre for Urban and Community Studies (CUCS).

Florida’s map shows the same differentiation that David Hulchanski did three years ago in his excellent report Toronto divided: A tale of three cities. This report received a lot of media attention, in part because its complexity and rigor left little doubt in its findings: Hulchanski, Associate Director (Research) of CUCS, carefully mapped many different characteristics using Census data spanning a thirty-year period, including income, housing tenure, transit use, ethnicity, immigration status, household size, and employment. The carefully-worded report raised some red flags: the decline of the middle class, the decrease in housing choices for low-income households, the shift of poor neighbourhoods from the inner city to the outer suburbs.

It’s common to say that people “choose” their neighbourhoods, but it’s money that buys choice. Many people in Toronto have little money and thus few choices…When most of the city is in a middle-income range, city residents can generally afford what the market has to offer…It is only when the percentage of those in the middle declined that we began to hear about “housing affordability” problems. If the incomes of a significant share of people in a city fall relative to the middle, the gap between rich and poor widens. Those closer to the bottom are more numerous and find it increasingly difficult to afford the largest single item in their budget–housing (either in mortgage payments or rent). J. David Hulchanski, Associate Director (Research), CUCS

Hulchanski, who has written volumes about affordable housing policy in Canada, wrote persuasively of the policy options that can help reverse these trends, and many writers echoed his concerns. Florida himself wrote an article in response in the Globe and Mail.

Florida, on the less thorough end of the spectrum, mapped “creative class”, “service class”, and “working class” occupations in the Toronto CMA. The Geography of Toronto’s Service Class, published by the Martin Prosperity Institute at U of T, shows how the “classes” were defined. Artists, doctors, teachers, managers, architects and computer programmers were all considered “creative class”. Cashiers, salespeople, police officers, food preparers, medical assistants, and administrative assistants were “service class”. And miners, welders, carpenters, truck drivers, production workers, and construction workers were in the “working class.” If you know Florida’s work, you know that he is preoccupied with class and that he tends to use loaded terms; “class” is not a casually-used word in the Canadian research arena.

The kind of work people do is the hallmark of social-economic class and the map shows a city where the dominant classes occupy, literally, two different social, economic, and geographic spaces. Richard Florida, www.creativeclass.com

Map from www.creativeclass.com

It is true that Toronto’s postindustrial shift has led to a decrease in manufacturing jobs, suburbanization of workplaces, concentration of high-paying service-sector work in the inner city, and gentrification around subway lines (all of which Hulchanski pointed out earlier, not to mention Tom Hutton and David Ley). But Florida’s definitions are directly responsible for his findings: how is a doctor in the “creative class”? A manager or computer programmer? And how do police offers and medical assistants get grouped in with cashiers and administrative assistants? It seems as though he has just mapped by salary level, not occupational category…in which case his results aren’t surprising.

Research involving income, occupation, ethnicity, and polarization need to be carefully articulated and worded to avoid clichés like “upper class people live in desirable areas while lower class people do not.” There is much more depth to the story than Florida lets on, although he is fairly well-versed in housing issues. The recently-released report on Canada’s Housing Bubble, produced by the Canadian Centre for Policy Alternatives, outlines how housing prices have risen faster than inflation, household incomes, and economic growth. Echoing Edward Jones’ report earlier this year (see my previous post), CCPA says that the housing market is “more unstable than it has been in over a generation.” All major cities in Canada are now experiencing housing price increases above their historical range, meaning the time is ripe for a crash. For Florida, who advocates the creative class and advises cities on how to bring these types to their cities, real estate is crucial: he has written about the need for more rental housing, which in his opinion keeps people mobile and able to search for employment in a wider range of locations. His recent publication on Toronto’s class divide has more to do with the city’s political landscape than housing, of course, and it has served its purpose of being provocative.

Elite? or just educated?

Having spent some time working in the US and frequently immersed in American academic journals and conferences, I am well aware that there is a latent anti-intellectual bias that tends to rear its head during, oh…say national elections, or on the eve of major policy reform. Canadians, apparently, share this apprehension of “minority elites”.

The recent media storm over the Canadian census long form (see my previous post) has ignited a seemingly latent populace that believes that research, and researchers themselves, are pointless exercises in readin’, writin’, book-learnin’ and other geeky pursuits that don’t matter: that data will only be used in order to harass and over-tax the less-educated, privacy-minded general public. (Have a look at some of the articles posted in every major Canadian news outlet concerning the recent Census developments, and more to the point, have a look at some of the comments the “general public” posted.) But it’s not just your “average Canadians” who question the educated population. In today’s Globe and Mail (“Tories stall census probe, ask to hear from average Canadians”), Industry Minister Tony Clement has “already dismissed the controversy as one that only occupies “some of the elites in our country,” a phrase he also used when Canadian academics criticized the federal government’s decision to prorogue Parliament.

Maybe in countries where a university education costs more than a Bentley, it would be correct to state that educated people are a bunch of rich snobs who might be a tad removed from the fray (I said maybe). The vast majority of Canadian universities are public schools, meaning they have government-subsidized tuitions that are considerably lower than their American counterparts. Although tuitions have risen steadily in the last fifteen years or so, Canadian student loans are still readily available to most students. The Social Sciences and Humanities Research Council (SSHRC) offers fellowships for Masters and PhD students. Admittedly, these have become rarer in recent years due to the Harper government’s decision to prioritize PhD topics directly related to the economy, and the National Sciences and Engineering Research Council (NSERC) just announced it would drop its Doctoral Fellowship program this year. However, it would seem that funding scarcity hasn’t had much of an effect on our already high education levels.

Higher education is fairly well-distributed among gender, ethnic groups and income levels in Canada. During the 1930s, a quarter of Canadian women were university educated, and to look at graduate schools now you’d be hard-pressed to find a majority of men in any discipline: women have out-numbered men in university admissions since 1981. In the 2006 Census, 25% of the Canadian population had a university degree higher than Bachelors level. By the way, this is lower than the 31% of Americans with this level of education. Almost half of the Canadian population (49%) has a college diploma, trade certification, or university degree. Of OECD countries, Canada has the highest percentage of the population (from 25 to 64 years old) with a post-secondary education (46%), slightly higher than the Japan (40%) and the US (39%), and considerably higher than the OECD average of 26%.

Many immigrants enter the country with educations far superior to those born in Canada. And because the vast majority of population growth in Canada is due to immigration, these university-educated immigrants have a major impact on our cities, our labour market, and our education systems. In 2006, 51% of recent immigrants to Canada had university degrees, compared to 19% of the Canadian-born population. Immigrants also out-perform native-born Canadians in prose, document literacy, numeracy and problem-solving, according to the International Adult Literacy and Skills Survey. Even more importantly, immigrants raised in China, India, or the Philippines (Canada’s three largest source countries for immigrants) know the importance of education and instill it in their children. Let me be clear: it is well known in the poorer parts of the world that education offers an escape route out of poverty. In most cases, the only way out. Many of my classmates at the University of Toronto were the children of immigrants who had only been able to complete high school educations or, occasionally, community college. We were the first generation to attend community colleges and universities en masse, and it was expected that we do so, because our parents could not afford to go themselves when they were our age. Despite their scrimping and saving, many of us were unable to pay tuition without government-subsidized public schools, government-funded loans, scholarships and fellowships.

While a university attendance is lower among the low-income population, Statistics Canada published a study in 2007 that found lower rates of attendance were due to differences in academic performance, parents’ level of education, parents’ expectations, the high school attended, and other such factors. Only 9.5% of the youth in the study reported that financial constraints were a barrier to university attendance. While this is still cause for concern, it is somewhat reassuring that the rapid ascent of tuitions in the 1990s have not have more serious effects.

I’m not sure that it’s accurate to describe this one-quarter of the Canadian population with Bachelors degrees as elite, or “the most powerful, best educated or best trained group in society” (Cambridge Dictionary). Can the half of the population with post-secondary educations, or the half of recent immigrants with university degrees, all be considered elites? While there are some groups in Canada who are under-represented in higher education (only 8% of Aboriginals have university degrees, but 41% have post-secondary educations), we are generally an educated bunch.

Perhaps that’s the real crisis in the Harper government: realizing yet again that Canadians aren’t as dumb as his 2008 re-election might suggest. First, we rose up in the tens of thousands to protest proroguing Parliament, and now that over 200 groups have protested the removal of the Census long form, he’s had to personally speak out on what he probably considered a minor technical issue that would only concern “elites”. After both of these crises, the Conservatives dropped in the polls, creating considerable distress for Harper’s minority Conservatives. An educated populace is a problem when your government acts more like a monarchy than a democratically-elected minority government that could topple at any time.

Sheng and Shanghai

Sheng Zhong recently defended her PhD dissertation at UBC School of Community and Regional Planning. Last year at the Association of American Geographers annual conference, she gave us a little preview of her research results on cultural production sites in Shanghai, focusing on one of the seventy government-designated sites, M50 on Suzhou Creek. She also published this case study in the 2009 issue of Critical Planning (Vol 16): From Fabrics to Fine Arts: Urban Restructuring and Formation of an Art District in Shanghai. Her research consisted of extensive interviews, surveys and site visits of most of these former industrial sites now destined as high-end cultural centers. The concept of the creative class might be controversial here, but Sheng’s research shows the Chinese government is jumping on the bandwagon that supposedly leads to economic growth and development, as suggested by Richard Florida.

In Sheng’s doctoral defense, she contrasted two cultural production sites, one of which developed on its own, as artists found the low-rent buildings vacated by industries that had relocated to the suburbs. The second was designated by the government and targeted for redevelopment. The contrast between the two was very interesting: the first had grown illegally for some time as artists occupied the various buildings on the site, then over a decade gentrified to the point where rents are almost at the upper limit of affordability for small-scale production. The second site was initially designed with high-end stores and upscale landscape architecture targeted to foreign tourists. It is under-used (the rents are too high and there may not be enough demand for the location) and the artwork sold there is unaffordable to the Chinese population.

Dr. Zhong will be starting a post-doctoral position at the National University of Singapore, where she will continue her research on urban redevelopment and the policies that impact growth and change in Chinese cities.

Update: As of February 2012, Sheng will be a lecturer at the brand new Xi’an Jiaotong-Liverpool University in Suzhou, a joint effort of China’s Xi’an Jiaotong University and the UK’s Liverpool University.

New food policy developments in Vancouver

Cypress Community Garden

Municipalities have become increasingly concerned about food security in the past few years. I’ve written before about Vancouver’s Food Policy Council and some of the work they’ve been doing, including encouraging a by-law to allow backyard chickens. Since then some notable developments have happened in the city.

A few weeks ago, Vancouver city council approved five community projects, agreeing to spend $100,000 on the small-scale projects. One aims to help people on social assistance or small fixed incomes can buy coupons at the beginning of each month for a small fee and redeem them later in the month for fresh fruits and vegetables at a mini-farmers market in the neighbourhood. Another funds the development of farmers markets; several Vancouver neighbourhoods worked with city council to streamline fees and fix restrictive zoning bylaws. Council has now approved the development of interim guidelines and zoning changes to develop new farmers markets and expand existing ones, including the very successful Kitsilano, West End, and Trout Lake markets. I visited the West End farmers market this weekend and found the vendors selling seasonal greens, peppers, berries, cheese, fresh lamb and eggs. The prices, as usual for Vancouver, started around the same as supermarket produce and went up from there, but there’s no denying the freshness of the food. I’m still not sure why farmers markets out here are so pricey, when a dollar or two at a market in Ottawa, London, or Toronto will get you a head of broccoli bigger than your own.

There are lots of other ways to get fresh produce in the city. Vancouver has some amazing community gardens, where residents pay a small fee for a garden plot and grow all sorts of fruits, vegetables and flowers. A friend of mine has a plot at the Cypress Community Garden, which cost her $30 for the summer. She goes to garden work parties with the many other gardeners in the area; Kitsilano is full of apartment dwellers who otherwise wouldn’t have the space to grow their own food.

You can also raise chickens and have access to your own fresh eggs daily, since the bylaw was passed to allow backyard chickens. You can check out all these developments on Vancouver’s Food Policy Council website.

Housing unaffordability is historically the norm

“Why doesn’t the president of the United States ever get up and say, ‘You can be a full-fledged American citizen and rent an apartment — it’s OK.” David Wessel, economics editor, Wall Street Journal

Americans now pay more for housing than ever before, according to a report by Harvard’s Joint Centre for Housing Studies. In its annual report The State of the Nation’s Housing 2010, researchers write that 18.6 million Americans spend more than half their incomes on housing, up from 13.8% in 2001. While this figure includes both owners and renters, 45.1% of renters are in the bottom income quartile. Homeownership is at a historical low, household income barely increased in the past decade, and rental vacancies are at a historical high. No wonder the authors are calling calling the first ten years of the 2000′s “the lost decade.” But housing “unaffordability” isn’t anything new, nor are our solutions to the problem.

While the Harvard researchers blame falling wages and high unemployment (9.9% in April 2010), high rental vacancy rates and low supply of the most affordable and smallest units are also major issues. Fewer homes were built in the US in 2009 than in any year since WWII, particularly multifamily homes: 62% fewer multifamily developments were begun in 2009 than in 2008. Demolition and conversion of existing low-income rental units is also a major cause for concern. Lower immigration rates are also taking their toll: there was a sharper decline in the number of foreign-born households under the age of 35 than in native-born households from 2009 to 2010. Minority households have been hit hard by the mortgage crisis. In 2009, minorities accounted for 37 percent of householders aged 25–44 and 39 percent of those under age 25. The minority homeownership rate is still expected to increase by 2020, despite lower incomes among foreign-born and minority households and lower immigration rates due to the economic recession.

Some progress has been made in terms of rental housing: rental conversions from foreclosed housing has already been done in many cities, but Housing and Urban Development (HUD) considering introducing market-rental units into its publicly-funded affordable housing developments in order to help pay for much-needed maintenance on the buildings. And the pro-homeownership policies keep coming, including the renewal of the federal tax credit for first-time homebuyers (and its expansion to repeat homebuyers) and Federal Reserve purchases of mortgage-backed securities to help keep interest rates low. But with the expiration of the tax credit program in April 2010, Harvard’s Joint Centre for Housing Studies warns that any good news may not be long-lasting. The problem, they say, is that there is unusually low demand for new homes. The ratio of housing and transportation costs to income has risen steadily over the past fifty years (see Figure 30 and 31 of the report).

As I’ve written before, without massive government programs to support homeownership and assistance for low-income renters, housing has ever been a good deal. Check out the CBC’s digital archives on the development of suburbs. In a video clip from 1954, the narrator explains how expensive homes are for the average person and how far people have to live (up to 50 miles from the city center) to afford them. In 1953, the average Canadian earned $971/month before taxes. Don Mills, the first suburb in Canada, had house prices beginning at $11,000 all the way up to $100,000. Rental rates at that time were $300/month for the average apartment in Toronto (already hovering around 30% of the average Canadian’s income, the level most housing authorities classify as affordable) and $100/month for a basic three-bedroom in the city centre. In the new market-rate high-rise apartment complexes in the suburbs of Toronto, apartments went for less than $100/month. In Montreal, then the largest city in the country, 70% of homes were apartments and the going rent was $70-100/month, only slightly more than the rents in Winnipeg ($80/month). A house in Vancouver was $2,000 cheaper than in the east at the time. While 1950s housing solutions (demolition of existing older housing to make room for low-income public housing developments in city centres, massive concrete high-rises in the suburbs) may have been questionable, they were quite desirable at the time: the wait for affordable housing, like the still-under-construction Regent Park) was 2 years for a $29-90/month rent-geared-to-income apartment. The average rent at Shannon Heights, a 1950s assisted rental development in Halifax, was only $90/month. Commuting to the city became a new drag, and buses quickly replaced streetcars and trains, steps were taken to make commuting more enjoyable. A 1963 video clip records a housewife saying that the lack of transportation options in the suburbs mean she spends considerable time driving her teenagers around; another says her family moved to the suburbs because that’s where they could get a mortgage.

Whatever housing problems we face today, whether it’s affordability or commute distance, they’re nothing new. Solutions to these problems, like artificially stimulating homeownership through tax incentives and policies, are likewise nothing new; housing affordability problems persist. Recently, researchers at the The New York Times compared the cost of living in a suburban house to an urban apartment in the New York City metro area, and found that the suburban option cost a surprising 18% more (“High-Rise, or House with Yard?” July 2, 2010): the big difference was the higher property taxes, and their comparison didn’t include the cost of home repairs. Even the The Wall Street Journal is publishing articles saying homeownership doesn’t work (“Is the Homeownership System Broken?”, June 22, 2010): WSJ economics editor David Wessel is quoted as saying, “So now we have a system where a lot of people own homes but don’t have any equity in them, which means you don’t get any of the virtues of investing in them. And the government has been forced to take over the mortgage financing system, which suggests that it wasn’t a very strong one if the government has to take it over.” This is quite a turn of events. Could North Americans be forging a new path in housing policy?

The Philippines: the new China/India?

It seems that I may no longer have to answer the question, “Why are you doing a case study of Filipinos?” Ever since the 2006 Census showed that Filipinos were the largest immigrant group entering the country, there has been increased interest in the status of the Filipino population in Canada, with a major focus on those who have entered the country under the Live-in Caregiver Program (LCP). It’s gotten to the point that to say you’re working with the Filipino population is to invite harassment at parties by people wanting to know why nannies aren’t allowed to bring their family members to Canada with them (an excellent question, but one outside of my field of study).

In June, the Vancouver Sun featured a special five-part series on Filipinos in BC, trying to paint a broader picture of the Filipino population than their reputation as “nannies and maids”. However, the articles succeeded only in painting a somewhat grim picture of the challenges new immigrants face, even well-educated Filipinos who are usually fluent in English. Many of the more recent Filipino arrivals came to Canada on temporary worker visas. This program started in 2001 and was intended to fill labour shortages in technology, such as jobs in the burgeoning oil sands in Alberta. It was then extended to all kinds of other areas such as nursing, trucking, construction, fast food industry, and retail. There have been complaints about the program as it is vulnerable to human rights abuses, although some temporary workers may now apply for permanent residency after two years. Still, as I found out during my fieldwork in Toronto, Canada offers a better deal than other countries: it takes ten years to qualify for residency in Germany and in Saudi Arabia, it is impossible to get permanent residency. There are many other challenges for newcomers, which is why many choose to move to the major cities, where substantial Filipino populations, cultural associations, and community groups can provide support.

As many of you know, my dissertation focuses on the housing and transportation choices of Filipino immigrants in Toronto. I am particularly interested in how these choices have changed over time as the city grew and changed. What kinds of jobs did new immigrants find when they entered the country? Where did they live? How did they travel? Structural changes in immigration policy have played a key role in these choices, such as the introduction of family class sponsorship in the 1970s, the creation of the LCP in the 1980s, and the temporary worker category in the 2000s. I will be writing more on my dissertation topic as I finish up my data analysis in the next few months.

Transportation governance in Toronto

I wrote recently about the fight to save Transit City, a proposal to extend LRT lines throughout Toronto’s inner suburban neighbourhoods. A while back, I had written about transportation governance in Metro Vancouver and its effects on public transit provision, and noted that Toronto was heading the same way. Well, it has: since 2009, the Metrolinx board has been completely divorced from public process.

Members of the Metrolinx board are appointed by the Minster of Transportation; they are not public officials elected by their municipalities. The current board, like the TransLink board in Metro Vancouver, is made up of mostly private sector business people who may or may not have conflicts of interest in transportation matters (ie. businesses that are located on a street with a proposed LRT line). Knowledge of transportation planning or experience taking public transit are not prerequisites; but to be fair, they never were, even when the board was made up of public officials. The Board can decide whether to hold meetings in public and how often to meet. There is no opportunity for the public to speak at meetings, even if they are allowed to attend, so there’s really no accountability for Metrolinx’ actions. The only recourse the public has is to complain to their MPP. But even if an MPP belongs to the party in power, they likely have no influence over who the Premier appoints as Minister of Transportation and who the Minister appoints to the Metrolinx Board.

It is bizarre that in Canada’s two largest cities, very small appointed boards decide the future of public transportation (11 sit on the TransLink board, and 15 on the Metrolinx board). It’s also a bit of an anachronism; we live in the area of downloaded responsibilities. The federal government offloads responsibility for housing and health care to the provinces; provinces download housing to the municipalities. Why would the province want such a tight grip on public transit provision? What is to be gained? Granted, these two boards are very short-lived so it’s hard to tell what their influence will be (Vancouver’s Canada Line notwithstanding). But like most transit advocates, I remain cynical about the whole issue of private-sector appointed boards making decisions about public spending, even if by some miracle they were actually public transit specialists. We need better governance in place for cities, especially on crucial issues like transportation and housing. Otherwise transportation board decisions will continue to be made as one-offs and there will be a lack of continuity in infrastructure projects and funding.

High homeownership bad for Canada?

I’ve often felt that homeownership is not the rosy American Dream that it claims to be. I find homeownership limiting, both economically and geographically: my parents and their friends, and now friends my own age, seem to sacrifice anything and everything in order to make mortgage payments. The years I worked at Canada Mortgage and Housing Corporation, taught me how the federal housing agency was created partly to help sell the idea of homeownership right after WWII and enable it through a series of government-backed programs and policies. Then there’s my own research in the area of immigrant settlement and housing choice, which included a serious look at Canadian federal housing policies that have slowly eroded rental housing, co-op housing and social housing as options while supporting homeownership through numerous incentives. Let’s just say that it’s no surprise that at age 36, I’m still a renter, bucking the DINK and yuppie trends, a little cynical about the myth that renting is just “throwing your money away.” After all, renting has allowed me to remain flexible, pick up and move to different cities, travel, and live in neighbourhoods I never could have afforded if I had bought.

It appears that Richard Florida agrees with me. Higher rates of renting, public transit use and residential mobility are all key themes in Florida’s latest book, The Great Reset: How New Ways of Living and Working Drive Post-Crash Prosperity, released two weeks ago (read a review of the book, and other Florida works and quirks, on Urbanophile). Florida belies the myth that housing is a good investment, particularly when it’s held for 20 or 30 years: the rate of return on housing in the US has generally been quite low, in fact from 1890 to 1990 it was exactly zero. We’ve all seen how difficult it can be to sell a house in recent years in the US, and in earlier recessionary times in Canada: my parents’ current house was bought for $20,000 less than a similar house a few blocks away because the owner had lost her job in the 1990s recession and had to sell quickly. A friend’s parents sold their house in 2007 for almost the same price they paid for it in the early 1980s because the mill in their town had closed, leaving most of the residents out of work.

Overinvestment in housing has decreased investment in other areas like medical technology, software and alternative energy. Florida has written before about the dangers of putting too many eggs in one basket: at the height of the mortgage crisis in the US (in a November 28, 2009 article in the Globe and Mail), he wrote that the mortgage system was directly responsible for the crisis, and that the era of overinvestment in homeownership and car ownership were over. Interestingly, Florida also applies his argument to individuals: Canadians carry more mortgage debt as a percentage of their disposable income than Americans, meaning we have far less to spend on other things. A friend of mine who works in mutual funds and investments tells me the average homeowner pays for their house two and a half times due to interest. This is probably no surprise to those of us living in the country’s biggest cities, where housing prices are astonomical and have not shown any decline in growth since the US mortgage crisis. In fact, housing prices in Canada increased 20% last year.

Florida argues that in cities with higher homeownership, unemployment is also higher because homeowners are less likely to pick up and move when things get tough. He believes that mobility is often the key to employment, and more flexible housing choices are key in times of economic instability. It seems there are other people out there like me, who prefer the flexibility of renting because we want to remain mobile and have no desire to live in one place for twenty years. We aren’t all that uncommon either: 40.1% of the Canadian population moved within the past five years, according to the 2006 Census; 14.1% moved within the last year. Florida correctly predicted that rental housing would play a major role in stabilizing the US economy after the mortgage crisis: families were able to move into foreclosed properties that were renovated and re-marketed as affordable rental housing. This was because the Obama administration wasted no time in investing $4.25 billion on the creation of tens of thousands of federally-subsidized rental units using the federal Making Homes Affordable program.

Vintage 1950s matchbooks featuring real estate ads

In his May 3rd article in the Globe and Mail, Florida goes as far as saying that “home ownership is an impediment to Canada’s long-term prosperity” because high house prices, low interest rates and lax government policies in Canada could spell trouble for the housing market. Even though people have been talking about the “bubble” for over fifteen years, Edward Jones’ recent report predicts Canada’s is about to burst. The federal government recently made it more difficult to get a mortgage and is considering other measures to tighten mortgage availability in order to protect the market from collapse. They eliminated the no down payment mortgage option before the US crisis began, but there is still a 5% down option. What is particularly interesting to me as a non-economist is how the housing market has historically been used to maintain or even increase consumer spending to stave off or recover from economic recession: besides the post-war era, we saw low interest rates brought in after the 1989 stock market crash in Canada and after 9/11 in the US to encourage people to keep buying homes. I guess there’s a fine line between “removing barriers to homeownership” to encourage spending and bringing on an economic meltdown by letting anyone with a a couple of bucks buy a house.

Massive marketing was required to sell the idea of homeownership as a stable, more respectable lifestyle choice. Let’s not forget that those first homes were practically given away at very low prices and low mortgage rates, their construction highly subsidized by federal governments in both the US and Canada. Those cherubic children, war brides and returning vets in 1940s suburban home ads were so convincing that most of us still believe homeowners are somehow better than renters: even Florida hints that switching from homeownership to renting might have “unforseen social costs” for cities and regions. Our own values and biases about homeownership drive the market. Yet a mere 60 years ago, renter households were the majority in both our countries.

The classic French text Un chez-moi à mon coût (2000) (edited by Eric Brassard), which I read at the urging of a fellow renter working at CMHC, carefully dissects all the economic myths of homeownership, arguing that it is often the non-economic factors that are the most influential. The book presents case studies of housing choices of a variety of professionals, both renters and owners, who argue that there is no sound economic argument for homeownership or against renting: it just comes down to personal preference. But we’re so invested in the homeownership ideal that investing in rental housing, or convincing middle-income families to rent, would take a lot of work. The tide may be turning in the US, but with high housing prices and fairly easy access to mortgages, we may not see this shift in Canada until our own mortgage crisis rears its ugly head.

Save Transit City

I’m getting pretty tired of writing about great policies and projects that we’ve proposed in Canada, only to have to write later that the government has decided not to fund them. Toronto’s Transit City project, an ambitious attempt to link the suburban parts of the region to reliable rapid transit through the construction of eight LRT lines, is under threat. Despite being approved by the federal and provincial governments, the province is threatening to cut Transit City funding by half, decreasing the viability of the project considerably.

A map showing the proposed LRTs

I’ve written before about how complex governance is when it comes to public transit in our municipalities. Vancouver’s struggles to build the UBC rapid transit line and many Canadian municipalities’ policies to better link transit and housing are detailed in several other posts. Even when projects are approved, it’s no guarantee they will be built because we have no stable source of funding for public transit and no consistent governance structure that enables the transfer of federal or provincial funds to municipalities. Transit City originally proposed eight lines: Sheppard (14 km), Finch West (17 km), Eglington Crosstown (33km), Scarborough, Don Mills, Jane, Scarborough Malvern, and Waterfront West. The province agreed to fund the first four back in 2007: of these, three are new lines (Sheppard, Finch West, and Eglinton) and the fourth is a retrofit of the existing Scarborough RT with four new stations. The province’s proposal to cut funding in half will put the Eglinton LRT, Scarborough RT, and Finch LRT at risk: the Sheppard line is already under construction while Eglington and Finch were to break ground this year and Scarborough in 2012.

As U of T Social Work professor David Hulchanski illustrated a couple of years ago, increased incomes in the areas around the existing two subway lines make it all but impossible for lower- and middle-income people to live close to rapid transit.

Hulchanski's map showing the need for rapid transit

Hulchanski’s most recent map shows the areas which have decreased in income in the past forty years against the proposed lines: the new LRT lines would be making transit much more accessible to the rapidly-growing areas of the region (read his plea for action on ttcriders.ca). My own work with immigrants in Toronto shows that they are willing to travel long distances on infrequent public transit buses only for a short time; eventually they succumb to buying one, two, and three cars. They live further and further out because that’s where affordable housing is…little realizing their transportation costs will eat away considerably at their savings.

Last week mayor David Miller recorded a public service announcement on the subway PA system telling people to call the Premier’s office and their MPPs to oppose the Transit City cuts. Many of the local mayors are also urging their citizens to do the same. All sorts of organizations, from Toronto Environmental Alliance to the Public Transit Coalition have links to the appropriate politicians, and there is a Save Transit City site. I urge you all to call, email, write the MPPs and Premier McGuinty and if you’re in the Toronto area, pack the Council chambers this Wednesday April 21st.

Ren Thomas

M.A., Ph.D. (Planning)

New food policy developments in Vancouver

Transportation governance in Toronto

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