The Blog: A City for Whom? Thoughts on Calgary’s Housing Crisis

Calgary’s residential vacancy rate the lowest in the country and its rental costs among the highest. The residential vacancy rate is hovering around 1.4 per cent, and the average rent for a two-bedroom apartment in Calgary is $1,267. Faced with a housing crisis, Premier Jim Prentice delivered a choice line: “I believe that the only real solution for this is the market.”

This is a surprising statement about an industry that has been carefully orchestrated and guided by government policy. First, the nature of land as a commodity is an issue. Karl Polanyi describes the establishment of land as commodity an “entirely fictitious” though necessary and useful exercise: one cannot really produce land, store it in warehouses, or convert entire landscapes into raw elements (though some try). So while it’s not a real commodity, in the same way that linen coats or widgets are, it gets treated as one as a basic part of a market system – one can’t have a factory without a place to put it. To turn land into commodity, it has to be given a status through laws, in institutions, and so on: this is called government intervention.

Beyond this theoretical feature of land-as-commodity, consider also the fact that housing has been massively shaped by the Canada Mortgage and Housing Corporation (CMHC), a Crown corporation. Historically the CMHC has financed suburbanization across the country through low-cost mortgages, and today, ensures residential mortgage loans as part of its mandate. As Richard Harris argues, a particular kind of housing (suburbs) and a particular way of financing it (CMHC) made it the only readily available housing option for most post-war Canadians.

All this is to say: it’s a bit rich that Prentice is deploying “the market” as the solution, when “the market” is itself orchestrated by government policy. This is a way of avoiding the issue, while explicitly offering support for the beneficiaries of the current system.

Who benefits from the current system? High housing prices are great for people who happen to own lots of housing, build housing, and invest in housing. If you happen to rent property, high demand works in your favour. If you sell homes, sell mortgages, or sink a chunk of your paycheque into a mortgage payment on a regular basis, a higher price, higher property value, and high demand probably work in your favour.

An unfortunate result of suburbanization and the accompanying home-ownership craze, as David Harvey has noted, has been a new kind of politics: focusing community action towards the defence of property values and individualized identities. By contrast, a functioning democracy might allow for the following questions to be worked out politically: what kind of city do we want to live in? Who is included? Who is excluded? How should we allocate our collective resources?

Narrowing the discourse about housing (and cities generally) to simple “market realities” excludes social actors that aren’t major market players – like the working poor, the young, the homeless, the unlucky – and is a way of avoiding what should be a political and democratic conversation, and turning it into a decidedly more private and profitable one.

 – Joël Laforest is an Urban Studies major and contributor to the UrbanCSA blog


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