I call this meeting to order.
Welcome back to meeting number 23 of the House of Commons Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities.
Pursuant to the orders of reference of April 11 and May 26, 2020, the committee is resuming its study on the government's response to the COVID-19 pandemic.
Today's meeting is taking place via video conference, and the proceedings will be made available on the House of Commons website. The webcast will always show the person speaking, rather than the entirety of the committee.
Before speaking, please wait until I recognize you by name. When you are ready to speak, please click on the microphone icon to activate your mike. I remind everyone to please use the language channel of the language they are speaking.
I want to begin by thanking our witnesses for their patience with our aborted attempt at this meeting last week and for their co-operation in agreeing to reappear this week. I also want to let members of Parliament know that with regard to our second panel, we received a cancellation from MKO less than two hours ago, so we have only one witness for the second panel. The witnesses on the first panel have graciously agreed to remain.
For the first hour we're going to have representatives from Homeward Trust Edmonton and from Mortgage Professionals Canada. For the second hour we'll have Front d'action populaire en réaménagement urbain as well as the witnesses from the first hour.
Without further ado, I want to welcome Susan McGee and Giri Puligandla from Homeward Trust Edmonton, as well as Elaine Taylor and Paul Taylor from Mortgage Professionals Canada.
I understand Ms. McGee is going to be giving the presentation for Homeward Trust Edmonton. You have the floor, Ms. McGee. Please go ahead.
Thank you very much, and thanks for the introduction.
I am the chief executive officer for Homeward Trust. We are a community-based organization utilizing a system-planning approach to ending homelessness in our community of Edmonton. We are the local entity supporting the implementation of Reaching Home, and we have actively supported the evolution of Canada's national housing and homelessness strategies. I was very privileged and fortunate to sit on the advisory committee on homelessness, chaired at the time by , and I currently sit on a number of national committees.
I'm joined today by Giri, our chief strategic officer. I expect there will be some questions that he would be better at answering than I would be. We want to allow time for that.
We and our partner agencies have been recognized nationally and internationally for our collective efforts to end homelessness, housing nearly 11,000 people since the beginning of our Housing First program in 2009. Our organization brings together funding from all orders of government to support service providers, indigenous communities and government partners in Edmonton to collectively plan, act on and monitor our solutions to end homelessness in our community.
We're grateful for the opportunity to speak today about the Government of Canada's response to COVID-19 and what is needed to ensure that vulnerable and homeless Canadians are supported and protected on the long road ahead.
It has been just six months since COVID-19, and the risks it presents to our community members have required a complete rethinking of our priorities and programs. This has been an intense and exhausting effort, but one that we can be proud of and that wouldn't have been possible without the quick mobilization of resources from municipalities and provinces and, indeed, the federal government.
For Edmonton's homeless response, Reaching Home funding played a critical role. Funding was committed early, processes were accelerated, and both local organizations and federal program staff were empowered to make necessary decisions, building on existing accountable relationships. For many of us involved, the lasting reflection is that we can and should continue to respond that way by treating homelessness as the national emergency it is in any situation.
Homeward Trust is a strong supporter of Recovery for All and the six-point plan already presented to government by the Canadian Alliance to End Homelessness, and we support other national organizations such as the CHRA and its advocacy of greater investments in affordable housing, specifically indigenous-led housing investments.
Rather than reiterate those well-considered positions, we will focus on what we consider to be critical and immediate steps to support their successful implementation.
First is that our country requires a sustained investment to make sure that communities' Herculean achievements over the last six months, which has been a sprint, have the endurance for the marathon that lies ahead. With no commitment on the horizon, planning has ceased and programs are being wound down, while individuals are exposed to the same health and safety risks that we experienced in March from the beginning.
Second is that all orders of government focus efforts not only on protecting vulnerable Canadians from the pandemic but also on addressing the many systemic issues that have made people vulnerable to homelessness in the first place. The pandemic has laid bare these system failures, and we can't unsee what we have seen.
Last is that the government reinforce communities in leading this response in a coordinated system-planning approach, bringing together the various cross-systems and interjurisdictional roles that, operating independently, risk recreating the system failures we are working so hard to address.
On the first point of sustained investment, there is no question that all orders of government recognize that we are many months away, if not years away, from this pandemic's being completely behind us. There are more waves on the horizon and, perhaps most critically, large numbers of people losing their jobs and families in crisis. They are losing their homes and their mental health is being significantly affected. We've never experienced anything like the initial pandemic response before, and there is no precedent, certainly in our lifetime, for the economic and fiscal fissures that are already forming.
Initial investments were made quickly, and we were fortunate to have strong program infrastructure and partners to work with to activate those resources.
In Edmonton, our response prioritized mobilizing critical services in an alternate location, as agencies, public spaces, and other locations that often provided respite for homeless individuals closed. We brought in our coordinated access and Housing First program with additional rapid rehousing and diversion efforts, and included new partners and prevention initiatives by providing immediate funding to address short-term needs. We were able to secure and headlease a hotel to provide bridge housing, which has played an important role in our community's response in housing over 700 people to date since April.
In the absence of sustained funding, we are faced with having to contract all of those efforts at a time when we are seeing significant increases in homelessness and encampments on a scale not seen in Edmonton since 2007. We know that housing is a solution to homelessness, and we have seen the direct health risks to those without a home. We cannot build our way out of the situation fast enough, but we can ensure that our pandemic response results in long-term permanent solutions if program funding is sustained and targeted. There is a role for all governments and charitable funders in supporting our efforts, but it is important to recognize that community-based providers are reeling from lost fundraising revenue and staff capacity and will have difficulty dealing with the onslaught of needs, let alone the existing demands. It is imperative that the federal government lead with a commitment now.
Reaching Home has incorporated many important changes in community planning approaches, emphasizing evidence-based models, clear accountabilities and system-wide engagement. This means having the infrastructure to enable a culture of knowledge-driven decision-making so that our interventions can be targeted, evaluated and corrected continually, and taxpayers can be confident that public dollars are achieving the results they'd expect. As such, I have great confidence that continued investments through Reaching Home will have the greatest immediate impact.
This brings me to my second point: that the pandemic response has to address the foundational issues that contribute to poverty and homelessness, especially those that are institutional in nature. The homeless population is dynamic. There are no clean boundaries between people who use shelters, people who sleep rough or in encampments, and people who are unstably housed and people who are living with friends and family.
With rising unemployment, bankruptcies and evictions, people who faced housing insecurity before the pandemic will become homeless. Addiction and mental health issues are increasing rapidly and threatening the ability of families and individuals to stay resilient, yet for homeless and vulnerable populations, various systems and government departments get involved in a way that creates a patchwork of responses, with huge gaps and blind spots and far too many unmet needs. Their roles are often defined by narrow mandates and cost containment, without a holistic sense of how all their parts interact—and they don't.
An effective pandemic response for the homeless population has to incorporate commitments to fix the underlying systemic problems that create and sustain homelessness. There may not seem to be an obvious first step to address this issue. Indeed, governments have spent years in system-planning meetings trying to turn the Titanic in an inch of water. However, during the pandemic we have seen health authorities actively participating in local efforts, and they have been required to address the specific risks that homeless community members are exposed to. The pandemic has highlighted how quickly we can adjust how we work together when the urgency and the will are there.
This leads to my final point, which is about the importance of community-based leadership in the pandemic response.
In March, community organizations were navigating shifting and sometimes conflicting authorities in the federal government, provincial ministries, health authorities and local governments. Siloed internal command structures and interjurisdictional confusion can threaten an active, effective and comprehensive pandemic response. One of our key roles as community entities and system-planner organizations is to transcend and bridge across these chasms so that we can enable communities to do what needs to be done. In many ways, governments and systems need to take a back seat to let communities lead the way. They have the knowledge, experience and relationships to ensure that we are doing what is best for vulnerable people. This means empowering and resourcing communities to enable community-level leadership and governance. It also means building the necessary infrastructure so that community partners can implement actions collectively and leverage resources and strengths across the board without having to manoeuvre between funding and institutional roles.
Reaching Home clearly embraces the role of local leadership, and as such has been able to deploy resources quickly during this time, with demonstrated impacts. While other investments are considered, whether to support housing developments or mitigate housing loss, we strongly recommend reinforcing community-level leadership in coordinating that deployment of those resources.
In summary, for an effective pandemic response, the federal government needs to commit to supporting community-based leadership with funding and policies that can address two public health emergencies: the recent and ongoing impacts of COVID-19 and the long-standing institutional causes of homelessness. Continuing investments by the federal government are the only way to ensure that community efforts and achievements over the past six months are sustained and that we don't regress in our ability to protect vulnerable people from the impacts of the pandemic in the long run.
A critical component of this is to accelerate efforts to realize an end to homelessness, including the six-point recovery plan put forward by the Canadian Alliance to End Homelessness, and intentional engagement with provincial and municipal governments to support communities in making this happen by transforming systems so that they facilitate their work instead of hindering it.
I appreciate the opportunity to speak to the committee today, and we are certainly happy to answer any questions.
Thank you, Mr. Chair, and members of the committee. On behalf of the over 12,000 members of Mortgage Professionals Canada, thank you for providing the opportunity to take part in the discussions today.
My name is Elaine Taylor. I am vice-president of sales for MCAP Corporation and chair of the board of directors of Mortgage Professionals. Also with me today is Paul Taylor—no relation—the president and CEO of MPC.
For additional context for our remarks today, I'd like to remind the committee of MPC's membership composition. We are a professional association promoting mortgage broker-originated mortgages.
By head count, mortgage brokers and agents across Canada make up the largest component of our membership. However, almost all Canadian banks and mortgage lenders that originate mortgages through independent agents and brokers also belong to our association.
Additionally, all three mortgage insurers in Canada are also members. Because of the diverse nature of our members' businesses and their respective role in facilitating broker-originated mortgages, MPC has a thorough understanding of the marketplace impacts of any changes to mortgage financing and funding costs, securitization and liquidity, underwriting criteria and lending guidelines, and changing consumer behaviours.
In our remarks today, we would like to thank the government for many of the measures taken to ensure economic and liquidity support for Canadians and businesses alike. Specifically for our industry, the reintroduction of the insured mortgage purchase program, with its newly increased stated limit of $150 billion, provided much-needed access to capital for banks and other lenders. Additionally, the reduction of the domestic stability buffer added $300 billion in liquidity to banks for them to be able to support struggling businesses through additional extensions of credit. The reductions in the Bank of Canada benchmark rate also occurred during this time.
We are supportive of all of these changes and the speed with which these mechanisms were brought to bear. As an industry, we were reassured by the timely and coordinated macroeconomic support brought forward.
One suggestion that we may offer for OSFI to consider, following the same thought process as the already implemented reduction in the domestic stability buffer, is to reduce the capital requirements for mortgage insurers. This would allow them to reduce their required premiums, making access to the IMPP and other programs easier for lenders and borrowers.
The Canada emergency response benefit and the innumerable suite of cash flow and credit support programs were tremendously supportive of many of our independent and smaller mortgage brokerages. Making CERB accessible to non-EI eligible income earners was greatly appreciated.
Switching gears somewhat, the industry, with government support, has been providing mortgage payment deferrals to many mortgage holders. Current Canadian Bankers Association statistics suggest that 16% of all mortgage holders have at some point since March deferred at least one payment. In testimony to FINA, CMHC president Evan Siddall warned that this number could reach 20%, or one in five, and that these deferrals may all become mortgages in arrears when these programs expire in September-October.
I'm happy to report that the experience of our member mortgage lenders is much more optimistic. Many borrowers who took advantage of the deferral program have since voluntarily resumed their payments and opted out. Participation numbers are falling, not increasing. Public records of these results are available in recent releases by Equitable Bank and Home Trust to their shareholders.
While this is encouraging news, we do, however, anticipate that there will be some mortgage holders who will find themselves unable to meet their mortgage obligations when the deferral period expires. The general expectation is that these families will be forced to sell their homes and that this influx of housing inventory to the market will create price softening as more housing options are available to buyers. It's with this expectation that we make two requests.
First, consider extending the deferral period for those who are truly unable to meet their obligations but expect to return to work in the near term. If OSFI were to implement a portfolio percentage maximum permissible to continue to not be considered a non-performing loan, lenders would ensure appropriate means testing and targeting of this continued support. Permitting lenders this capital relief of 5% of loans within their portfolio will assist those Canadians most affected by the pandemic to stay in their homes. We would recommend extending this provision for at least another six months.
Second, given the possible price softening expected in some markets, and with the recent and unambiguous assurance from new Bank of Canada Governor Tiff Macklem that interest rates will stay low for a very long time, we ask for the immediate implementation of the previously announced, but postponed, adjustments to the insured and uninsured mortgage trust tests. Today's uninsured mortgage qualification requires borrowers to show that they're able to manage their mortgage payments at a fictionally higher interest rate, either two percentage points above the negotiated contract rate or the Bank of Canada's posted five-year rate, whichever is higher.
In the past year as interest rates have fallen, and recently as the Bank of Canada has significantly reduced its overnight rates, the posted five-year rate has not moved in lockstep. In fact, it's only moved incrementally, as is evidenced by the very small 15 basis-point reduction last week. Today many borrowers are having to prove mathematically that they can manage a mortgage payment at an interest rate of almost 3% higher than their contract rate. If the proposed changes were enacted, really simply, the stress test would effectively be reduced from what is currently almost 300 basis points to 200 basis points, or from 3% to contract plus 2%. Remembering that this test is in addition to existing debt service ratio maximums, this implementation will permit would-be owner-occupiers to purchase their first home while still ensuring that stringent underwriting and qualification mechanisms are in place.
If real estate prices do come down in the upcoming months, that's exactly the time we should be encouraging young and aspiring middle-class Canadians to purchase a home. Excluding them from the marketplace will only serve to widen the wealth gap, leaving more homes for investor purchases rather than would-be owner-occupiers.
Lastly, Mortgage Professionals Canada has additional recommendations related to housing finance, insurable 30-year amortization options specifically to support first-time buyers, increasing the maximum insurable value of a property, and creating an exemption to the aforementioned stress test for renewing borrowers who wish to change lenders.
We'll continue this discussion, and we'd be happy to elaborate further on some of those during the question period, but for the sake of brevity today, in our opening statements we'll stick strictly to the implementation of the previously announced test adjustment and the extension of the deferral program, if possible.
Thank you very much indeed to everybody for your attention and for the opportunity to present today. We look forward to your questions.
As mentioned, my name is Marie-José Corriveau. I represent the Front d'action populaire en réaménagement urbain (FRAPRU), a group that was created 41 years ago. It is made up of 140 organizations from across Quebec that are concerned about poverty alleviation and housing rights. FRAPRU primarily calls on higher governments in order to advance the right to housing and access to social housing.
In terms of the government response to the pandemic, FRAPRU is grateful to the federal government for quickly setting up the Canada Emergency Response Benefit (CERB), which has enabled households to meet their basic needs, such as food and housing. However, FRAPRU is disappointed, even shocked, by the disproportionate amount of money made available to the wealthiest versus to the poorest and most vulnerable households to get through the health crisis. In terms of housing, just like after the 2008 economic crisis, Canada decided to primarily help banks, insurance companies and property owners, leaving tenants to fend for themselves. We are coming out of these last few months with an increased sense of injustice.
Moreover, the CERB failed to prevent 3,000 Quebec households from having to resort to the Quebec program set up to help tenants unable to pay their rent after losing their jobs and suffering drastic cuts to their incomes. The next few months will be worrisome for many of them, as they will have to pay back loans without necessarily having found a job by that time.
However, one good thing about the pandemic is that it has reminded us of the close and incontrovertible connection between the right to housing and the right to health, and of the fact that housing is one of the main determinants of health. The lockdown measures imposed to minimize the risks of the spread of the coronavirus have not been experienced by everyone in the same way.
How can you be in lockdown when you just don't have housing? How can you stay locked down in a house that is too small, unhealthy or suffocating because of successive heat waves? How can you stay healthy when rent takes up an inordinate part of the family budget to the detriment of food, medication and other necessities, such as a mask or the Internet? How do you cope in times of lockdown when you depend on community resources for food, clothing and transportation on a daily basis, but those community resources have to cut back on their activities to comply with the rules of physical distancing?
For too many households, the pandemic is yet another crisis in a life fraught with peril. Already, as of the 2016 census, 1.7 million Canadian households were in core housing need—that is, living in housing that is substandard, too small or too expensive. The overwhelming majority of them are poor renters. In Quebec, the approximately 244,120 tenant households in core housing need had a median income of only $17,612 for all of 2015.
Since the last census, things have become worse. A housing shortage is spreading and taking root in Quebec's major cities, as in several other Canadian provinces. Here, the vacancy rate for rental housing is only 1.8%, and it is only 1.5% in the census metropolitan areas of Montreal and Gatineau. This represents half of the 3% threshold that is supposed to guarantee a balance between landlords and tenants. In Gatineau, the average market rent increased by 10% between 2018 and 2019, in a single year.
The impacts are devastating and will unfortunately last. Many tenants are under undue pressure to accept unjustified rent increases. On the ground, it has been observed that the rents charged for rental units this spring were well above the average current price. However, as the shortage seems to want to last, the concern is that this inflationary trend will continue. Among the hundreds of Quebec households who were unable to find new housing and who found themselves homeless last month, in July, many had been repossessed or “renovicted” because their landlords were trying to get rid of them, especially if they were long-term tenants and paying low rent.
Searching for housing in the midst of the pandemic is also problematic, if not impossible, for poor households that do not have access to the Internet because they do not have the equipment, because the system is too expensive or because the service is simply not available in their areas. Many, including families, racialized people and the poor, have also been discriminated against because of their condition, regardless of their credit or rent payment history, without any truly effective recourse to defend themselves. The shortage is literally pushing households to the brink of homelessness in the midst of a pandemic.
Finally, let's remember that, too often, to find new housing, the households thus displaced have had to leave their neighbourhood, their city, or even their region, thereby losing their family and community support network.
Under those circumstances, FRAPRU hoped that the federal government would not only quickly review the programs to help the poorly housed, but that it would also invest more in social housing as part of the national housing strategy. To date, it has done neither of those things.
Yet in 2017, when the national housing strategy was adopted, the government also identified households in core housing need. However, the resources announced to assist them came with serious gaps, making those measures ineffective. FRAPRU then identified and denounced those problems. If you wish, I can give you some examples.
Since the pandemic was declared, the unemployment rate has soared. Now, a second wave is looming, as well as a recession, or even an economic crisis. Governments are investing massively to support different parts of the economy. FRAPRU is asking them to relaunch a major social housing project and to adequately finance the refurbishment of all those units already built. So far, Ottawa's response has been extremely disappointing and detrimental to what is to come.
Beyond the health and economic crises, we believe that the government has a duty to protect the poorest and most poorly housed from the environmental crises that are now certain to follow. To do so, it must stop procrastinating and start investing again in social, non-profit and non-market housing. To fund the effort, the government has no shortage of resources. Here are a few examples. It can reduce its investments in fossil fuels. It can review its tax system, withdraw the tax benefits granted in recent decades to the wealthiest and restore a more progressive tax scale. It must also fight more seriously against tax evasion and tax avoidance. However, whatever avenues it chooses, it must better protect the most vulnerable, otherwise the political and economic damage will be disproportionate and the social fractures likely to be irreversible.
I hope I have stayed within the time limits.
I would like to come back briefly to a number of points.
First, we have to remember that most people with physical disabilities receive social assistance and that their income is extremely low. I don't know about the rest of Canada, but at least that's the case in Quebec. That's the first issue. They generally have no savings. They spend their cheques as they receive them, because that is the only way they can manage. They are in survival mode.
As for the second problem, as I mentioned, there is a shortage of housing, particularly housing that is adapted for people with disabilities. They are basically confined to their homes year-round. They are already having a hard time finding resources to support them and it is already difficult for them to move around. Clearly, under such circumstances, when they cannot count on any savings, they cannot be asked to fund this effort.
The government has to subsidize people. First, the Government of Canada needs to increase transfers to the provinces and encourage the provinces to increase social assistance benefits, especially for those people, but also for all poor unemployed people. They should not be asked to fund this effort because they are not able to do so. Therefore, they should be paid an amount quickly, as the government has done with the CERB.
I'm not sure whether that answers your question.
I'm glad you asked me that question. I didn't have time to address it in my presentation, but I wanted to tell you about it. The problem is renovating, improving and modernizing existing low-income housing to which the federal government contributed more than 25 years ago. The federal government has responsibilities to the provinces, to municipalities and, most importantly, to the households in low-income housing. However, those units have often been poorly or inadequately maintained. Preventive maintenance has been neglected for decades. In Quebec, we are facing a significant deficit, to the point that, as we have seen in Toronto in particular, buildings and low-income housing units are boarded up and uninhabitable because of a lack of proper subsidies to keep them in good condition.
Currently, the Fédération des locataires d'habitations à loyer modique du Québec estimates that Quebec needs $420 million a year to refurbish its 71,000 low-income housing units. For its part, the Office municipal d'habitation de Montréal, which owns 12 boarded-up buildings totalling almost 300 low-income housing units, needs $1.2 billion over five years or $150 million per year for 20 years to complete its 2017 replacement, improvement and modernization plan.
Just this week, I spoke to the director of the Office municipal d'habitation de Montréal, which has just received its budget for 2020-2021. This budget will not even allow for the restoration and rental of low-income housing that has become vacant simply because the occupants had to leave for one reason or another. In short, not only are we unable to refurbish and rent out boarded-up housing, but we are not even able to rent out those whose previous occupants just left. It makes no sense.
In our opinion, this is the responsibility of both levels of government, but certainly and first and foremost of the Government of Quebec, which is the main funder. For years, if not decades, it has systematically refused the preventive maintenance plans proposed by groups and municipalities to keep the supply of low-income housing in good condition. As someone who has been working in the field for a long time, I can attest to it. So this is the first urgent priority.
Furthermore, not only is the national housing strategy's funding for retrofitting buildings in good condition clearly insufficient, but we are also outraged that the government is maintaining its game plan to eventually stop funding and subsidizing the rent of the families that will occupy those units. From now on, after a decade or so, the responsibility will fall on neighbours, provinces, municipalities and territories. It makes no sense for the government to offload the responsibility and thereby abandon poor families. That was the second point I wanted to make.
The third point relates to the need for social housing. As I mentioned, in a number of large cities in Quebec, but also in Canada, we are seeing huge increases in the cost of rent. Poor families are no longer able to find decent housing in large cities. Financially, this would require impossible efforts on their part, because their budgets are clearly insufficient.
For its part, the government has chosen to fund what it calls affordable housing. Affordable housing is not affordable for low-income households and households in core housing need. Affordability is relative. What is affordable for you and me is not affordable for a poor family.
To have lower rents, we must stop setting targets based on current prices and instead set targets based on the ability of tenants to pay. To do so, we need to subsidize rents. The only solution is to rebuild and develop the supply of social housing so that we are not constantly starting all over again. Right now, among OECD members, Canada ranks 16th in terms of the proportion of social housing on its territory. This is obscene. We are part of the G7. Abandoning poor households in this way makes no sense. On our end, we believe that the government needs to drastically review its investments in developing new social housing and, above all, to focus its efforts in this sector.
We can't even blame the private market; it's doing its job, it's trying to make a profit. I'm sorry, but when you're out to make a profit, it's not true that—
I agree with everything the previous speaker said. We obviously need data to be able to see as clearly as possible the challenges we are facing and to be able to find good solutions.
But the fundamental problem with homelessness is the whole debate about what is and what is not a proper count. A few years ago, the City of Montreal counted about 3,000 homeless people in Montreal. However, that is not what we are seeing on the ground. They only counted people who, at a given time or on a specific day of the year, were on the street, period. They did not take into account all the strategies that people who are homeless or experiencing homelessness use, such as sleeping sometimes here and sometimes there. For example, I think of women who have become homeless because they can no longer afford a place to live, but who avoid sleeping on a park bench by all sorts of means. They are no less homeless, but they are never counted as such.
This means that the way in which the number of homeless people is determined is a fundamental problem. I feel that, if the count considered those strategies, we would come up with a much higher number than we had imagined.
The problems of homelessness among indigenous people have been relatively well documented in Quebec, particularly in Montreal and Gatineau, as well as in some other cities.
In the case of racialized people, there have been some clues, but no counts. Therefore, I am not in a position to tell you whether or not the technique currently in use is adequate or not. We can see, particularly in Montreal, that more and more racialized people are on the streets. This is a relatively recent trend, I would say, but I'm not sure whether their proportion is higher than that of the general population. I'm not able to tell you that.
In any case, I would like to stress that, from the outset, the method needs to be reviewed, because it gives us what I would call a false sense of comfort about what is really happening in cities.
Mrs. Corriveau, I applaud you and FRAPRU. Thank you for being here and for your testimony.
I am very familiar with your organization in Quebec. The claims you are making today are in line with those you have been making for years.
Please tell me if my figures are accurate. I believe you said that, in July 2020 alone, 350 households were without housing. That would be the highest number since 2003. Also, if the community organizations did a count, it might be higher. If this is accurate, it does confirm that there is a shortage of what we may call social housing. A distinction could be made between community-based housing, low-income housing and affordable housing, but let's say there is a shortage of social housing. This is something you have been working on for years.
Other speakers have talked about the national housing strategy. As you know, an agreement was signed between the federal government and all the provinces except Quebec. For Quebec, the amount over the last three years could be between $1.4 billion and $1.7 billion, which is not insignificant.
In your opinion, if the money had been transferred unconditionally to Quebec, what difference would it have made to the dynamic?
What more can I tell you? We still have no clear picture of the way in which each of the groups has experienced this pandemic, except what I was able to describe to you based on what has made the headlines or the number of calls that we have received in recent months. They were dealing with COVID-19, but what made things untenable is that they were also dealing with a housing shortage. That shortage is still with us. Whether there's a second wave or not, we still have a housing shortage.
That shortage is a reality in the large cities of Quebec and Canada but it is even more of a reality in indigenous territories. In our opinion, it is clear that every effort must be made in order to create new housing as quickly as possible to assist that segment of the population.
We know, as scientists are telling us, that because of climate change, pandemics are going to increase in the coming years and decades. We are going through one at the moment and we are finding it difficult. But goodness knows how many others are apparently waiting for us, because we are heading for serious environmental problems. Clearly, in that context, we have to act starting now, if only to avoid the worst of it.
That is more or less my message. Yes, some steps can be taken immediately, if only to provide households with the income they need to have suitable housing. We can't ask them to finance that effort because they have no savings. That makes no sense. Renters have no houses on which they can take out a mortgage. They have no goods they can sell, for example. Social housing has to be developed as quickly as possible. However, it has to be built properly in order to make sure that it will last.
I do not know whether that answers your question. One thing is for sure: we do not have a precise picture of the situation for people with disabilities. There have been calls for assistance, but is difficult to quantify the needs. However, we know that there is always a need for housing for those with disabilities, if only because the population is aging.
I'm going to turn to Mr. Taylor, but first of all, I would really like to thank Ms. Corriveau and Ms. McGee for talking about the continuum as we're looking at it. When I look at housing, I look at the whole thing and the impact in terms of that simple physics measure that whenever there is one action, you're going to get the opposite reaction as well. I look at that, and when we're talking about housing and homelessness, we also have to look at the other end.
However, my major concern right now is in the middle of this continuum. From some statistics I was looking at from the CREA, the Canadian Real Estate Association, one of the greatest concerns I have right now is about supply. Right now, housing inventory is at a 16-year low, and in my community it's at about 1.1 months of inventory, when we should be having averages of between five and eight months of inventory. This is just way out. The average cost of a house in Canada right now is $571,500. We know that it's gone up. Of course, there were going to be people wanting to get into the market, so we were expecting a bit of a boom, with sales going up by 26% in the month of July. I'm really concerned about the impact and I'm just going to tell you a little story about my own community.
Though I know that people who live in Toronto love having Mr. Vaughan there, they like to move to my community where they get a more affordable house, a variety of different things, especially with COVID. We have backyards, we have so many great things, but we're seeing the price of housing going up. Just recently a house that was on sale for $289,000 went over the asking price by $83,000. That's almost a 33% increase. That's what we're seeing in my community, especially for first-time homebuyers, for the people tyring to get into the housing market.
What do you think the federal government needs to do, or what are some of things we should be aware of as we're moving forward, knowing that we have low inventory and that first-time homebuyers are being pushed out of the market because we're seeing such high prices right now? Knowing the financial turbulence facing many people right now, how are they going to be able to get a mortgage?
Yes, I'm certainly happy to.
Quite simply, when the mortgage deferral programs were first created, all banks and lenders, as regulated by OSFI, have to retain additional minimum capital for any loans that are non-performing. It's prudent, of course. They need to have a stockpile of cash in the event that the loans that are currently in arrears don't ever actually find their footing and make their way to repayment.
Therefore, as a means to assist with the liquidity of the banks and allow them to continue to extend credit, OSFI agreed to allow deferred loans, specifically, not to be considered non-performing, which means that the banks do not have to set aside that additional minimum capital.
As reported at the beginning, the CBA says that somewhere around 16% of mortgage holders have deferred their mortgage at some point. We're actually seeing that number reduce, which is great to see and what we would hope to see as the economy comes back, but we do expect there will be pockets, which will be quite industry-specific, that are going to take a little more time.
If OSFI were to allow for an extension of the deferral program with some parametered constraints—and here I think that a 5% as a maximum allowable target within a mortgage portfolio is quite reasonable—to allow the banks themselves to set parameters around how they're going to means test, or who is actually going to be eligible to enjoy a continued deferral, there will, of course, be assessments of expected future earning capacity for the folks the banks would extend this to. It would be a nice accommodation for the folks who are likely still going to feel the effects of COVID for a little while longer, and for the banks to have the financial flexibility or freedom to be able to provide that extension as well.