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Yukonomist: What housing crisis?

The wary citizen watches what politicians do and not what they say.

The wary citizen watches what politicians do and not what they say.

Thus it is with housing. During our last municipal election campaign, candidates pledged passionately to tackle the housing crisis.

Now in office, they voted 6-1 at the Jan. 16 city council meeting to make housing, in effect, more expensive. They did this by blocking the proposed Stevens gravel quarry.

Gravel may sound boring, but if you are reading this in a house you are probably sitting on top of thousands of dollars of it. Your water and sewer pipes are buried in it. The road into your subdivision and the street in front of your house contain thousands of loads of gravel. The curbs and sidewalks in front of your house are made with gravel. Your house itself probably relies on gravel for its foundations.

You may never have received an invoice marked “gravel,” but you can be sure you paid thousands for it. You do this through lot fees and charges on your property tax bill. It was also a solid chunk of the amount the builder charged originally for your home.

By making gravel scarcer and more expensive, the City of Whitehorse is driving up the cost of new housing as effectively as if they put a tax on 2x4s.

“I think we’re making a mistake,” said Councillor Dan Boyd. He was the only member of council to vote against second reading of the city’s new Official Community Plan because it did not have a gravel source identified.

Kudos to Mr. Boyd for standing up and voting against the no-gravel plan.

(Two other members of city council voted in favour of the quarry earlier in the evening, but were okay with the final quarry-less plan when the final second-reading vote happened.)

Those priced out of the housing market and housing advocates are likely to be less polite than Mr. Boyd was at city council.

High housing prices are a root cause of a disturbingly wide range of issues in Whitehorse.

With high prices and high mortgage rates, the data shows Canadian families are paying an unprecedented chunk of their income for shelter. Whitehorse is no different. A recent Yukon Bureau of Statistics report showed that one-sixth of Yukon households are paying over 30 per cent of their income in housing costs, which is the standard industry redline for affordability.

This puts many families in financial stress, and leaves lower-income ones faced with horrible trade-offs between housing, food, prescription drugs and more.

High housing prices are also bad for the economy. While providing a short term sugar boost as the construction sector tries to catch up, in the long run higher housing prices discourage private sector economic development. Firms have to pay higher wages because workers have higher housing costs and that means some business activities are not worth doing. It is harder to attract people to live in Whitehorse, leading to many local businesses reducing hours or exiting some lines of work.

It is tragic for our community when you hear Yukoners talking about how their kids ended up moving to British Columbia or Alberta because they couldn’t afford a house in their hometown.

But all of this is good news for the net worth of people who are, as economists say, long on housing. If you own real estate, the city’s move is likely to support high long-term prices. Which is great for your wealth.

Most voters own their own homes. It is traditionally a sound political strategy to say you are in favour of more housing but then not rock the boat once elected.

This, of course, is why NIMBY forces are so powerful in city councils around the world. So much so, in fact, that places such as New Zealand and California are reforming municipal laws to limit the anti-housing-development powers of municipal governments. As in the Yukon, municipal governments in those jurisdictions operate under legislation passed by higher orders of government.

Votes such as the recent one blocking Stevens quarry also store up political trouble for the long run. It makes it very clear to young and low-income people that the system is indeed stacked against them.

How many municipal politicians across Canada have voted against housing development then gone to speak at a public forum where they encouraged citizens to have greater faith in the democratic process?

A cold-eyed political scientist would say that this will only change when the houseless and their advocates organize protests of greater size and energy than NIMBY activists.

In the meantime, city council has given another group of politicians an opportunity to show their true colours on housing: the territorial legislature.

The Official Community Plan now goes to the Yukon government for ministerial review. The minister responsible, or the legislature itself if he fails to do so, should tell the City of Whitehorse to put the Stevens quarry back into the plan or they will take a page from New Zealand and pass a law putting it in themselves.

Keith Halliday is a Yukon economist, author of the Aurore of the Yukon youth adventure novels and co-host of the Klondike Gold Rush History podcast. He won the 2022 Canadian Community Newspaper Award for Outstanding Columnist.