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The housing market isn’t racist. Blame your parents instead


If white Canadians have rigged the housing market in their favour, as critics charge, why do Asian-Canadians have much higher home ownership rates?

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By Peter Shawn Taylor

There’s no shortage of bad ideas about how to fix Canada’s housing crisis. But what if time is short and you need to access all the bad ideas in one convenient location? Then make haste for the Office of the Federal Housing Advocate (FHA).

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Over the past two years, Marie-Josée Houle, Canada’s first (and hopefully only) FHA, has established her office as Ottawa’s one-stop-shop for the worst possible advice on housing issues.

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Houle’s main obsession is with removing profit-making — or what she calls “financialization”— from Canada’s housing market. Beyond forbidding anyone from making a living supplying accommodation to people who demand it, she also wants to make it impossible for landlords to evict tenants for almost any reason, impose nationwide rent control and grant homeless squatters virtual property rights over public parks.

But perhaps the most alarming of Houle’s many outrageous assertions and demands is that Canada’s housing market is rife with racism that can only be eliminated by deliberate federal action. A 2022 report released by her office claims, “The violence of evictions and forced displacements stemming from the ongoing housing crisis in Black, Indigenous and other racialized communities exemplifies the severe consequences of the financialization of housing.” To correct this, the report calls for a public takeover of privately-owned apartment buildings and a ban on chartered banks and pension funds lending to “financialized” housing providers.

Another more recent FHA study reports that “racial discrimination in housing is widespread in Canada” and calls for the payment of “reparations” for past housing injustices. The impact of any of Houle’s policy recommendations would be catastrophic for Canada’s already-tenuous supply of new housing.

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But setting aside these practical implications, what should we make of the underlying claim that Canada’s housing market is rigged against “racialized communities”? The FHA musters no credible evidence that racists control the buying, selling or renting of housing in Canada. But ample data on race and housing from other sources tell a very different story.

A recent Statcan report, for example, looked at the “housing trajectories” of young Canadians by race. Housing trajectory refers to the process of starting off living in your parents’ house rent-free, moving out to become a renter and then later (hopefully) becoming an owner. The recent housing supply crisis has certainly made these transitions more difficult for everyone. But if Canada is as racist as the FHA claims, whites should have a much easier time navigating this trajectory than others.

The results reveal significant variations between races and birth cohorts in housing outcomes, but nothing that smacks of white supremacy. “South Asian and Chinese people had the highest rates (of home ownership) from early adulthood to middle age,” the report finds. The outcome for some white cohorts is as much as 24 percentage points below that of South Asians and Chinese. Blacks and Latin Americans, on the other hand, were the least likely to own a home by middle age, with ownership rates three to 19 percentage points below that for whites and far, far below South Asian and Chinese people.

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“The large homeownership disparities observed among different population groups in their 20s were primarily attributed to differences in their tendency to live in the parental home,” the report observes, noting that differences in “family housing resources” shape future outcomes. Chinese-Canadians are more likely to live at home with their parents as young adults. This means they spend less on rent and have more resources to buy a home later in life. On the other hand, Blacks and Latin Americans are more likely to leave the parental home early, and thus end up spending a greater share of their income on rent as young adults.

Other Statcan research on housing bolsters this story. Chinese-Canadians are far more likely to own a home, regardless of age, than any other racial group. At 84.5 per cent, their homeownership rate is well above the Canadian average of 71.9 per cent and nearly double the rate for some other groups, including Blacks at 45.2 per cent and Latin Americans at 48 per cent.

Such a racial leaderboard of outcomes arising from Statcan’s race-based data is not limited to home ownership. In education, income, poverty and employment, a parsing of national data by racial background repeatedly reveals a distinctly uneven landscape. Asian-Canadians are typically at the top, whites in the middle with Blacks and Latin American-Canadians at the bottom. If we are to believe that Canada is a country defined by racial discrimination, it appears white supremacists are doing a rather poor job of it. Based on the observed results, the chief culprits behind any racist takeover of Canada must instead be Asian. Or is there a more convincing explanation closer to home?

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Recall how parental housing resources were a major factor in the housing trajectories of young Canadians. This significant role of parents in determining the outcomes of their children looms large elsewhere. For example, a recent Statcan study on poverty by race found that “almost 21 per cent of the Black group consisted of one-parent families, compared with nine per cent among the white group.” The lowest rates of single-parent families were South Asian and Filipino, who also had very low rates for poverty. “Having more earners in the family was strongly associated with lower poverty rates,” the report observes.

The significance of two-parent families to socio-economic outcomes is further backed by the new book The Two-Parent Privilege: How Americans Stopped Getting Married and Started Falling Behind by University of Maryland economist Melissa S. Kearney. Having two parents in the home is significantly beneficial to the performance of children across numerous categories, she writes. “As a social scientist, I am convinced that the two-parent family structure is, in general, advantageous for children and we cannot ignore what the growing prevalence of one-parent households means for children and inequality.”

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Kearney finds clear distinctions between racial groups with respect to marriage patterns. “White and Asian children are significantly more likely to live with married parents, as compared to Hispanic and Black children,” she writes. And this has major implications for these children later in life. Another key factor in Kearney’s data is the relationship between a college education and the propensity to get and stay married, although she notes that Asian households demonstrate high levels of two-parent families regardless of education. This she attributes to a “strong cultural norm,” and it likely explains why Asians tend to congregate at the top of the leaderboard in so many categories.

Despite the FHA’s bluster that Canada’s housing market is fraught with racism, the evidence suggests observed racial variances are much more likely the result of socio-economic factors that are largely within a household’s own control, including getting a college education, getting married and staying married. What is widely decried as racism today is thus primarily a problem of the family. And as such requires a family-based solution far from the remit of government.

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Recommended from Editorial

As British philosopher Bertrand Russell once wryly noted, the secret to a long and happy life is to “choose your parents wisely.”

Financial Post

Peter Shawn Taylor is senior features editor at C2C Journal. The original, longer version of this story first appeared in C2CJournal.ca.

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