Prominent financier Ira Gluskin says Canada’s housing affordability crisis is multifaceted, but he thinks the solution lies in free enterprise. 

Ira Gluskin, former money manager and the chief investment officer of Irager + Associates Inc., told BNN Bloomberg that a high cost of living may incentivize many Canadians to relocate to more affordable housing markets.

“The big solution is free enterprise. Canadians, I hate to say this but they are already leaving Ontario. They should go to Edmonton, there are job opportunities and housing is half the price,” Gluskin said adding that other U.S. cities may also entice Canadians. 

On Wednesday, the Canada Mortgage and Housing Corporation (CMHC) released a report saying immediate action by all levels of government would be needed to address a housing supply gap of 3.45 million units. 

Gluskin said Canada does not have many big cities, which leads people to “congregate in four or five major cities.” He said this is different from the U.S. market, where housing is expensive in some cities, but cheaper in others. 

Other issues plaguing Canada’s housing market, according to Gluskin, include labour shortages, home prices and interest rates.

“There's a huge shortage of construction labour. But the biggest thing is at the price level that they sell at, there's not many people can afford to buy these houses,” he said. 

“Right now all the government is doing is talking. Whereas in reality, if interest rates went down there'll be a proliferation of building. It's as simple as that.”

Another contributing factor to Canada’s current housing predicament is the fact that new builds make up only a small portion of the market. 

“The big thing is there are millions of homes in inventory ready. They trade like a free market, everybody's buying and selling houses,” Gluskin said. 

“The new homes that are going to come are just a tiny percent of the market. The new homes can’t affect the old homes. The inventory of existing homes is what sets the market and it's sort of random, what these new houses will sell for.” 


A significant change in Canada’s discourse around housing issues is new attitudes towards immigration, according to Gluskin. Housing supply deficit has been a long-standing issue, he pointed out, but Canadians now have started to discuss the pressure from high immigration numbers on the housing market. 

“The biggest thing that's changed, if you read what people were talking about a year ago, immigration was sacred,” he said, adding that Canadians broadly support immigration.

“And nobody really wanted to relate what was straightforward, that all these new immigrants and all these new students must have been increasing (housing) demand.” 

As increased demand applies pressure to Canada’s housing market, Gluskin said there is confusion, because conflicting government policies around immigration and housing could worsen the issue. 

“In other words, in Ontario, the government froze the price that you could charge tuition to Canadians. So what was the university supposed to do?” he said

“They brought in foreign students who pay six times as much, but they couldn’t house them.”