Canadian Centre for Economic Analysis

Calculating the Social Return on Investment for Affordable Housing

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The benefits of affordable housing extend beyond the number of units built or households housed; they can include impacts on residents’ health, employment, and access to community amenities. The benefits can contribute to GDP, and have broad social implications for Canada.

Social Return on Investment (SROI) offers a viable way to demonstrate the impact of government spending on housing by attaching a monetary value to the benefits housing brings to residents, housing providers and the local economy. There is a well-established, internationally accepted methodology for calculating SROI. However, SROI calculations are only as good as the inputs chosen and the valuation of those inputs, that is, the analytic framework.

This research involved a literature review, analysis of existing SROI studies of affordable housing, and the construction of a Framework for determining the SROI for investments in affordable housing. For each existing study, this research project looked for the impacts considered, how impacts were being measured, and what financial proxies were used to quantify social returns. The project rated each SROI study of housing investment based on methodology and the efficacy/appropriateness of variables for Canada. The report, commissioned by CMHC, provides recommendations for a framework to measure SROI for affordable housing in Canada.

The full report can be downloaded from CMHC here.