HOUSING AFFORDABILITY CRISIS FACED BY CALGARIANS
The cost of housing has been going up in Calgary, and across Alberta, in recent years.
This has created what some are calling a crisis around affordability. The housing affordability in Calgary is decreasing on various factors which leads to many problems in city.
The Press spoke to Mandeep Singh, a builder in SE Calgary about the issue and below is an excerpt of that conversation.
Why is the cost of housing going up in Calgary?
People are in need if houses due to the migration of immigrants within Canada from all over the world. I think Calgary is being in the similar situation with Ottawa in housing affordability. The main reason in the present scenario, thousands of people moved from Ukraine to Canada after the Russia- Ukraine was to protect their lives.
How much more housing do we need in Calgary?
Well, a lot, I think this question is very hard to give the exact number, but according to the data given by the city of Calgary there are more than 80,000 people looking for affordable housing in Calgary and this number is likely to grow by 20 percent in next few years.
How long would it take to build that?
This depends on the demand of every community and projects issued by the government. There are many communities where the demand is more the houses are constructed more frequently. For a one house it approximately takes 7-8 months for base to final.
What drew you to this industry?
I like this question, I moved to America from UK in 2015 and my elder brother was working in this business from last decade and I started working with him. I gained a lot of experience and learnt every process and after that, I completed my degree in this field and started working in Canada in 2022.
What changes have you seen in the housing industry in recent years?
There are many things which occurred in past few years and the main change was the cost of housing which increased by nearly 20% after 2020. The lot sizes are decreased and there are many rules changed by the city in the construction of house or basements.
How does the shrinking of lot sizes affect the issue?
The lot sizes are reduced to construct more houses on the same piece of land. Nowadays, the more houses are built in zero lots as compared to last few years. As a builder or developer, it saves the cost of fence and an amount of land.
What affect has changes in mortgage rules had?
Due to inflation, the market for new built houses is decreased due to high-interest rates on mortgages and taxes. The interest rate for mortgage increased to 10% from 4-5%. The demand for housing decreased and the demand for renting apartments and basements increased by one-third. Due to that, more apartments are constructed to save the space in new communities of Calgary.
When do you think affordability will improve?
According to me, the affordability will be improved by 2025, when the interest will be reduced. Many people are willing to buy new houses but due to high interest rates, the mortgage are not getting approved.
