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Rent erodes tenants' income, study shows

23% of households pay half their earnings in rent

Toronto Star - March 23, 1999
By John Spears — GTA Bureau Chief

Nearly one in four tenant households in Toronto is paying out half its income in rent, a new study conducted by two housing federations says.

The situation for tenants across Ontario is little better - and in some areas worse - than in Toronto, says the preliminary study.

The research shows that the situation of low-income tenants has become "dramatically" worse, says Robin Campbell of the Ontario Non-Profit Housing Association.

Those paying more than half their income in rent are in danger of losing their homes, Campbell warned in an interview.

Her association sponsored the research along with the Co-operative Housing Federation of Canada.

Its release comes in the same week as a two-day symposium on homelessness, organized by Mayor Mel Lastman, is being held in Toronto.

The summit takes place Thursday and Friday, and is seeking input from the provincial and federal levels of government, as well as from the municipal level.

The new research complements arguments made by Anne Golden in a report on homelessness prepared for Lastman.

Golden has has said it's essential to help those in danger of losing their homes, to keep them from joining the ranks of the homeless.

The housing groups used data from the 1991 and 1996 censuses to compare the incomes and rents paid by tenants.

Canada Mortage and Housing Corp. (CMHC) says 30 per cent of income is a reasonable amount to pay for housing.

The study, however, found that 45 per cent of Toronto tenants pay more than CMHC's recommended guideline, according to the latest census. That's up from 33 per cent five years earlier.

The numbers for the province show about the same percentage of tenants above the CMHC guideline.

The statistics show an even more alarming trend for the lowest income tenants.

In Toronto, 23 per cent of all tenant households - that's 106,295 households - pay 50 per cent or more of their income in rent.

The proportion has increased from 15 per cent of tenant households in the previous census.

Tenants are far worse off than homeowners, according to the study.

The figures show that only 9 per cent of homeowners pay half their income in mortgage payments.

Across the province, just over 300,000 tenant households pay 50 per cent or more of their income in rent, or 22 per cent of all tenants.

That's up from 15 per cent in the previous census. Again, homeowners are much better off, with just 7 per cent paying half their income in mortgage payments.

"The surprising finding on our part is that the problem certainly isn't Toronto only," said Campbell.

For example, in Peterborough 55 per cent of tenant households pay more than 30 per cent of their income in rent, and 28 per cent pay more than 50 per cent.

That shows the risk of homelessness is a broad problem that must be addressed by provincial and federal governments as well as cities, said Campbell.

While Toronto has a very low vacancy rate for rental housing, affordability is a problem even in cities like Sudbury with a vacancy rate of 9 per cent, the survey showed.

Campbell said the vacant units are not necessarily in the right rental bracket.

"We clearly have a lack of affordable supply," she said. "There's clearly a mismatch" between the housing available and the incomes of tenants who need housing.

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