Latest news with #AustinThompson
Cision Canada
10 hours ago
- Business
- Cision Canada
Municipal government per-person spending in Canada hit near record levels
VANCOUVER, BC, June 26, 2025 /CNW/ - Municipal government spending in Canada hit near record levels in recent years, finds a new study by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank. "In light of record-high spending in municipalities across Canada, residents should consider whether or not crime, homelessness, public transit and other services have actually improved," said Austin Thompson, senior policy analyst at the Fraser Institute and author of The Expanding Finances of Local Governments in Canada. From 2000 to 2023, per-person spending (inflation-adjusted) increased by 25.2 per cent, reaching a record-high $5,974 per person in 2021 before declining slightly to $5,851 in 2023, the latest year of available data. During that same period, municipal government revenue—generated from property taxes and transfers from other levels of government—increased by 33.7 per cent per person (inflation-adjusted). And yet, among all three levels of government including federal and provincial, municipal government spending (adjusted for inflation) has actually experienced the slowest rate of growth over the last 10 years, underscoring the large spikes in spending at all government levels across Canada. "Despite claims from municipal policymakers about their dire financial positions, Canadians should understand the true state of finances at city hall so they can decide whether they're getting good value for their money," said Jake Fuss, director of fiscal studies at the Fraser Institute. The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians, their families and future generations by studying, measuring and broadly communicating the effects of government policies, entrepreneurship and choice on their well-being. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit SOURCE The Fraser Institute
Yahoo
23-05-2025
- Business
- Yahoo
Opinion: Housing will become affordable only if incomes grow faster
By Jake Fuss and Austin Thompson In a recent media scrum, former Vancouver mayor and new federal Housing Minister Gregor Robertson was asked: 'Should home prices go down?' His response: 'No, I think that we need to deliver more supply, make sure the market is stable. We need to be delivering more affordable housing.' That answer raises a followup question: what exactly does the Carney government mean when it promises 'affordable housing'? Rising house prices are nothing new. The sticker price for the average Canadian home typically rises, barring periods like the 2008-09 global financial crisis. And house prices aren't expected to fall anytime soon; forecasts point to continued growth. For homebuyers, however, what counts is not whether prices rise or not but whether they rise faster than incomes. By that measure, housing has become much less affordable in recent years. Consider the decade Minister Robertson was mayor: 2008-18. As the price of a typical single- or semi-detached Vancouver home rose from $690,000 to $1.98 million — by 187 per cent — the after-tax income of a typical Vancouver family rose just 15 per cent. Today, the typical single- or semi-detached home in Vancouver costs $2.38 million. Vancouver's housing market is in many ways unique, but price increases reflect a national trend: home prices have risen sharply even as income growth has stagnated, largely because immigration-fuelled population growth has generated housing demand that continues to far exceed new housing construction. Of course, housing can become more 'affordable' even as home prices rise so long as Canadians' after-tax incomes grow even faster. After-tax wage growth exceeded house price increases in the late 1980s, for example. Unfortunately, this seems unlikely to happen in the 2020s. As house prices have soared in recent years, wage growth has stagnated. In 2022, the latest year for which the data are available, the typical worker in our highest-wage province (Alberta) earned less than the typical worker in low-wage U.S. states like Mississippi and West Virginia. And from 2014 to 2024, Canada's real per capita GDP, an indicator of income and living standards, grew a mere 2.0 per cent compared to 19.6 per cent in the United States. In a recent analysis, economist Mike Moffatt estimated that if Canadian wages grew at the average rate of the past two decades and home prices didn't increase at all, it would still take 20 years to return to housing affordability levels of 2005. And of course, much could go wrong. If wage growth disappoints or mortgage rates or house prices rise, then the long march towards housing affordability may never end, which is awful news for young people looking to start a family. The federal government wants to double the rate of homebuilding in a decade. Is that realistic? Canada currently lacks the savings and investment required to fund that level of building. Nor, with tepid growth of our construction workforce, do we have the manpower to double output. And as always, local opposition to rapid housing development may prove hard to overcome. But even if somehow Canada did marshal the required resources and political capital, the end result, according to Minister Robertson, would only be to 'make sure the market is stable.' For many Canadians, 'stable' at today's prices means unaffordable — unless incomes rise. Clearly, housing supply is only half the battle. To achieve housing affordability on any reasonable timeline, the government needs to help facilitate not just a major expansion in homebuilding but also substantial growth in Canadian incomes — something the Trudeau government failed to do. The key is investment: to expand the housing supply, to grow the economy and to boost wages. In a capital-scarce economy such as Canada's, these goals may compete with one another. So governments need to adopt policies that attract investment, such as streamlining regulation and reforming capital gains taxes. Also, if rising incomes are to translate into improved affordability Canadians must keep more of what they earn. That will be difficult if increases in federal spending generate a higher tax burden. Ottawa must also craft immigration and residency policies that stop population growth from overwhelming housing supply and further increasing prices. A roadmap for addressing Canada's housing crisis Canadian home sales drop almost 10% from last year in return to 'quiet market' Canadians should think about housing affordability, not just in terms of housing supply but as part of a broader economic challenge where success depends on growing the economy, increasing saving and investment, and limiting how much governments take in taxes. Only a comprehensive strategy, centred on broad-based growth, will make the dream of homeownership a reality for future generations of Canadians. Jake Fuss and Austin Thompson are analysts at the Fraser Institute. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
