Separating Spin from Reality: What’s Really Driving Canada’s Housing Crisis?

Introduction

Welcome back to our series fact-checking Pierre Poilievre’s recent interview with Dr. Jordan Peterson. In Part 1, we unpacked the claim about Canada’s per-worker investment gap and the deceptive tactics behind it. Now, in Part 2, we’re diving into the housing crisis—a cornerstone of the interview where Poilievre claimed that “government-imposed costs and bureaucratic delays account for 60% of housing prices in cities like Vancouver.”

As always, we’ll separate fact from spin, highlight relevant context, and address how this impacts everyday Canadians. I’ll also layer in examples from Toronto, Vancouver, Montreal, and Calgary—cities with vastly different approaches to housing policy—to give you a full picture.

Breaking Down the Claim

Poilievre didn’t stop at pointing fingers. He promised to fix the housing crisis by cutting development charges, streamlining permitting processes, and incentivizing municipalities to build homes faster. Sounds good on paper, right? But as I’ve said before: Conservative solutions often serve corporations more than people.

Here’s the problem: The claim that government-imposed costs account for 60% of housing prices is misleading, and the solutions offered are already being tested—with limited success.

Government-Imposed Costs and Delays: What the Numbers Really Say

Let’s start with the 60% figure. Poilievre suggested that development charges and bureaucratic delays are the main culprits driving housing prices in Vancouver. However, available data paints a different picture.

• Development Charges: In Toronto, development charges for a typical new condo average $137,040, or about 11% of the total cost of a $1.2M home. In Vancouver, fees are higher, averaging $644,000 per unit in certain projects, or about 20%-30% of the total cost. These fees fund essential infrastructure—roads, transit, water systems—and aren’t the largest driver of housing costs.
• Bureaucratic Delays: In cities like Vancouver, permitting timelines can stretch two years or more, increasing financing costs for developers. But delays alone don’t account for 60% of housing prices. In Calgary, where permits are processed faster (around 10 months), housing remains more affordable, yet similar barriers exist in attracting developers to build affordable units.

What Really Drives Housing Costs?

The root causes of Canada’s housing crisis go far beyond government fees and delays:

1. Land Prices: In Vancouver and Toronto, sky-high land costs—driven by speculation and limited supply—are the largest contributors to housing prices.
2. Speculative Demand: Investor-driven purchases inflate prices, pushing homes out of reach for average Canadians.
3. Construction Costs: Rising material and labour costs add significant pressure, especially in regions like Toronto, where the demand for skilled trades exceeds supply.

How Do These Claims Hold Up Across Canada?

• Toronto: Ontario has already introduced measures to reduce development charges through Bill 23, but this has barely moved the needle on housing prices. Toronto’s programs, like the Open Door Affordable Housing Program, have incentivized developers with fee reductions and tax exemptions, yet the market remains focused on high-margin projects.
• Vancouver: Vancouver has offered fee reductions for affordable housing and allowed duplexes in single-family zones. However, with land costs that can account for up to 80% of a project’s value, the impact of reduced charges is negligible.
• Montreal: With lower development fees (around $25,000 per unit) and strict affordable housing mandates (e.g., the “20-20-20 bylaw”), Montreal has created a more balanced housing environment. Still, rent control policies discourage private investment in new rental housing.
• Calgary: In Calgary, development charges are the lowest among major cities, averaging $17,000 per unit. Combined with shorter permitting times, housing prices in Calgary remain significantly lower than in Vancouver or Toronto. However, Calgary’s affordability is also due to its abundant land supply, a factor not replicable in other markets.

Poilievre’s Promises: Do They Hold Up?

Poilievre’s proposed solutions—cutting fees, streamlining permits, and incentivizing municipalities—might sound appealing, but they’re already being implemented in many cities. The results? Limited success. Why? Because these measures don’t address the core issues of speculative demand, land prices, and construction costs.

Even Dr. Peterson seemed skeptical during the interview, noting, “If you just reduce these regulatory burdens, are you really going to create homes at a price people can afford, or does that money just get pocketed elsewhere?”

Exactly. Without controls on speculation or meaningful policies to increase affordable housing, the benefits of reduced fees rarely trickle down to buyers.

Why This Matters to You

The housing crisis isn’t a simple issue with a one-size-fits-all solution. Poilievre’s approach focuses on fees and red tape, but this ignores the structural drivers of unaffordability. Worse, it oversimplifies the issue in a way that appeals to frustration while deflecting attention from policies that could actually help Canadians.

Here’s what I want you to take away:

• Cutting development charges and red tape alone won’t fix housing prices.
• The biggest beneficiaries of these measures are often developers and investors, not the average Canadian looking for a home.
• If we want real solutions, we need policies that address land speculation, encourage affordable housing development, and protect renters and first-time buyers.

Read Part 3 Here – To export and increase emissions or protect the environment? 

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