Landlords In Power
Part three of our Housing investigation articles translated to english.
This is part three of a five part series Gabrielle and Isaac have written in French about the housing crisis, in conjunction with our podcast series. Please read the original french articles and listen to the podcast here!
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In this third article in a five-part series, we present our most striking findings: a large number of politicians have investments in real estate. Is it surprising, then, that housing policies favor homeowners over renters? But there's more– blatant conflicts of interest.
Several examples demonstrate that politicians can have conflicts of interest regarding housing, which could explain certain decisions.
This was notably the case for Quebec's Minister of Housing, France-Élaine Duranceau, who, in 2023, was close, both in business and in friendship, to a real estate entrepreneur and lobbyist, Annie Lemieux, who had an active mandate to lobby her ministry.
A more questionable one is Longueuil Mayor, Catherine Fournier, who has long been interested in housing issues. She was notably responsible for housing in her early political career, when she was a Member of the National Assembly under the Parti Québécois banner, before becoming an independent Member of the National Assembly and then mayor. She has also been a member of the board of directors of the Union des municipalités du Québec since 2021.
However, she opposed the establishment of a provincial rent register, refusing to sign an open letter sponsored by some fifteen mayors of Quebec's major cities in 2023. "It's not an bad idea, but in my opinion, it's not a priority in the current context," she said.
"Because I come back to the imbalance between supply and demand," she said. "Even if a registry is set up and we know how much the previous tenant paid, as long as the landlord gets the brunt of the problem– because (the landlord) knows you can't go anywhere else because there's no housing available– it's not much use. But in an ideal world, and if we were in a balanced situation, it would be a useful educational and information tool."
But could other, less obvious reasons have influenced the mayor's logic?
Catherine Fournier's partner, Charles Paiement, is president of Canora real estate agency, which operates primarily on the Island of Montreal. Sources who wish to remain anonymous have told us that they see this as a conflict of interest on the part of Mayor Fournier, given her involvement in the UMQ.
To this, the Mayor of Longueuil's aide responded that "under no circumstances, directly or indirectly, has Ms. Fournier furthered her personal interests or those of another person, either as a director of the UMQ or as Mayor of Longueuil."
This response also stated that "Ms. Fournier's husband does not own, in whole or in part, any building or real estate project in Longueuil, and all of his professional involvement and personal assets are recorded annually with the City in a declaration of interests pursuant to the [...] Code of Ethics and Professional Conduct."
The aide noted that Catherine Fournier "was the first Member of the National Assembly to publicly sound the alarm about the current housing crisis and has taken numerous actions as Mayor since her election in 2021."
Property Owners Well Represented Politically
According to our review of publicly available data, a significant proportion of our elected officials, both federal and provincial, have interests in real estate. (Please note that this database, with the exception of the section concerning federal MPs, who are from the previous parliament, is currently under construction.)
From the outset, we noted that almost all elected officials own their own residence and therefore do not belong to the renter class.
At the federal level, before the election of the new government, 47 per cent of MPs, across all parties, owned (or their spouses owned) rental properties. This is shown by a careful examination of the registry of the Office of the Conflict of Interest and Ethics Commissioner, whose information was cross-referenced with the database produced by the independent media outlet The Maple.
The proportion of MPs who owned rental properties remained close to half for the Liberal Party (47 per cent), the Conservative Party (52 per cent), and the Bloc Québécois (46 per cent), but fell to 21 per cent for the New Democratic Party.
During the last election campaign, Mark Carney, now Prime Minister of Canada, refused to disclose his assets, unlike the other candidates in the race. Real estate may therefore be among his holdings.
In Quebec, the proportion of homeowners in the Coalition Avenir Québec stands at 12 per cent, meaning that eleven out of 86 elected officials own one or more residences with the potential to generate income, according to the declarations of personal interests compiled by the Ethics Commissioner.
In opposition, this proportion is 16 per cent for the Liberal Party (three out of sixteen), 17 per cent for Québec solidaire (two out of ten), and 25 per cent for the Parti Québécois (one out of four).
At the municipal level, a 2023 survey conducted by Pivot and Ricochet showed that several elected officials responsible for housing in the City of Montreal also had interests in real estate. Overall, 33 per cent of Montreal's elected officials owned rental housing.
Lack of tenant-friendly policies
In addition to a high proportion of homeowners among politicians, there have also been policies unfavorable to tenants, such as a massive disinvestment in social housing, over many years.
"There is [...] a reason for the composition of governments: they themselves come from an upper middle class that has a lesser understanding of the reality of renters," said Julia Posca, sociologist and researcher at the Institut de recherche et d'informations socio économiques (IRIS). "We saw this very clearly in Quebec with the Minister responsible for Housing [France-Élaine Duranceau] who had direct interests in real estate speculation.
"I think that in North America, the importance of home ownership is very high, and therefore access to housing is largely linked to the spectrum of access to home ownership. This is the vision that has shaped all our policies since the Second World War," she said.
While the Legault government blames immigration for the housing crisis, Québec Solidaire MNA Guillaume Cliche-Rivard—who does not own a rental property—replies that the immigration rate is low in Quebec cities like Gaspé and Rimouski, yet there is still a housing shortage. "It's not immigration's fault that our governments haven't invested in social housing for the past 30 years," he said.
Among the political decisions unfavorable to tenants in Quebec, we can think of Bill 31, which was already heavily contested before its adoption in February 2024 and which imposes, among other things, the end of lease assignments, the facilitation of evictions, and the weakening of protections for social housing.
We can also look at the end of the AccèsLogis program, abandoned by the CAQ in February 2023, which was designed to finance the development of social and community housing, i.e., outside the private market. AccèsLogis has been replaced by the Quebec Affordable Housing Program (PHAQ), which works to build "affordable" housing by opening subsidies to private developers – who do not seem to deliver the goods.
For Virginie Dufour, Liberal MNA for Mille-Îles, Official Opposition housing critic, and owner of a residential rental building, the housing problem is a vicious circle that's difficult to resolve.
"People don't have... can't find housing because nothing is being built, but nothing is being built because if units are put on the market, no one is willing to pay," she believes.
Acknowledging in an interview that she is a homeowner herself, she laments that it's not ideal to ask landlords to lower rents, as it inevitably leads to a loss of income. "Nobody wants to lose money in their life," she said.
She cited herself as an example, explaining that she lost several thousand dollars on a home. "I bought a condo in northern Montreal, for which I paid $340,000. My mortgage is $290,000. With variable interest rates, the monthly payments are $2,600, at cost. But when I rent out my condo, I can't rent it for more than $1,800, which is very high for most people, but still less than cost."
She added that today, a new housing unit rarely comes off the ground for less than $400,000. "Without subsidies, we can't expect these units to be put on the market for $1,000 rental. That's why we need subsidies to balance the cost," she believes.
Moving Forward on Housing
Although several major plans have been announced in recent years to address the housing crisis, such as the National Housing Strategy and the Canada Housing Plan, governments seem to be struggling to keep their promises.
Organizations such as the Front d’action populaire en réaménagement urbain (FRAPRU) express disappointment with the initiatives implemented by the various federal programs, stating that they are "far too timid and came too late," adding that "the Strategy's main initiatives have largely served to build housing that doesn't even meet the government's affordability criteria."
Several other recent announcements suggest a multi-pronged approach to tackling the housing crisis.
Jean-Yves Duclos, federal Minister of Public Services and Procurement and Quebec lieutenant before the last election—who, according to our data, has no real estate interests—supported a community housing project in Centre-du-Québec last April, as well as three new federal buildings in Quebec City made available to build "more housing, faster."
In an interview, he explained that until 2015, housing was no longer a federal responsibility. "Several housing rights groups lobbied for federal investment in housing again," the politician confided.
"But to resolve a crisis, you first have to admit there is one, and some governments have been slow to do so," he said, commenting that this applied to both Liberal and Conservative governments in Canada.
For his part, Mark Carney, the day after his election as Prime Minister, announced his intention to double current housing construction in Canada to 500,000 homes per year, calling it "Canada's most ambitious housing plan since the Second World War."
Among the housing measures announced by Mark Carney during his campaign were the creation of a new federal agency, Canada Homes, dedicated to the construction of new, more affordable housing, the investment of $25 billion in financing for prefabricated home builders, and the elimination of the Goods and Services Tax (GST) for first-time buyers priced at $1 million or less.
Many experts, however, doubt the feasibility of this project, given the current difficulty in building half of this target. "There is certainly a disconnect between the people who are skilled at designing housing policies and the people who are subject to them, when they should rather be the beneficiaries," Julia Posca said.