Housing affordability has grown into a national concern resulting from a number of complex and interconnected factors. Our December 2015 report, Understanding Shelter Affordability Issues: Towards a Better Policy Framework in Ontario, introduced the Shelter Consumption Affordability Ratio (SCAR) index, which measures the proportion of income that households devote to their shelter-related needs (including transportation, utilities, and maintenance) after paying for other necessities, such as health care, food, and child care. Unlike other housing affordability indices, SCAR does not measure affordability by simply measuring housing prices or mortgage rates. Rather, SCAR presents a much more realistic representation of what people face every day when trying to put roofs over their heads.
The multiple variables impacting housing affordability as captured by the SCAR imply that there may not be a one-size-fits-all solution for this problem across Canada. In other words, households face very different types of affordability pressures and there is little relationship between the magnitude of the SCAR in a given province and the type of relative factors that contribute to it. With the notable exception of transportation costs, which are a driving force of affordability pressure in most provinces, single-issue approaches are unlikely to benefit the many Canadian households facing significant pressure to make ends meet.