In one of their last Insights Podcast, Don Mills and David Campbell posed an important question: Given the unprecedented population growth happening in Atlantic Canada, how are the government and the various stakeholders preparing to provide the variety goods and services that the population is going to need in the not-so-distant future?
We will analyze today one of those key services: Housing.
The Centre for Cities (2008), acknowledges that the housing market impacts economic growth through three main channels: 1) the labour market, in attracting different kinds of workers to the city economy. If the quality of the housing market is high and affordable, more workers will settle and stay in the region; 2) the city’s infrastructure, given the effect that new housing expansions and population growth have on public services and transport infrastructure, which need to growth alongside the new developments; and finally, 3) the business ecosystem, where in areas of high demand, the high costs of living will impact on the costs of doing business – raising wages and rent levels, and impacting on business location and expansion decisions, and in areas of lower demand, costs will be lower, but the often limited range and poorer quality of housing provision can fail to attract the necessary workers and restrict growth.
Unfortunately, the global housing market is facing a crisis. Not enough houses and apartments are being built or are not affordable enough to keep up with the increasing demand. The main causes are shortages of land, lending, labour and materials (WEF, 2022).
Canada is no exception. In their latest 2022 report about housing shortages in Canada, the Canadian Mortgage and Housing Corporation  affirms that if current rates of new construction continue, to restore affordability, Canada will need an additional 3.5 million units over the 19 million housing units that will be built by 2030. This means, 18.4% more units than are currently expected/forecasted.
But what about Southeast New Brunswick? Where are we on the housing issue?
From the 2021 Census we know that the average household size in the Moncton CMA and in Southeast New Brunswick is 2.3 people. Dividing that number by the total population, we can get an estimate of the number of private occupied dwellings that were needed in 2021 for every family to have housing. The gap in 2021 was already almost 1,400 private dwellings in both the Moncton CMA and Southeast New Brunswick (see table 1).
It is important to consider, that this approach, referred in the literature as the ‘need for housing’ (CMHC, 2022) is inadequate for estimating housing demand, because it is assuming that the average number of people per household used that exists today is the desired equilibrium level in the market, but it doesn’t take into account the affordability issue. Nonetheless, it is a good starting point to begin the discussion.
This means that the level of growth of new housing developments is a little behind the level of growth of the population in both regions.
This information allows us to look 5 years into the future to evaluate how many new private dwellings will be needed if the growth of the population as well as the growth of new constructions will remain the same.
The Moncton CMA will need 6,324 more dwellings (16.8% more than what was built between 2016 and 2021)
Southeast New Brunswick will need 8,344 more dwellings (10% more than what was built between 2016 and 2021)
Considering affordability issues, these numbers should be even higher.
So, how is the region going to promote a higher increase in new developments to be able to meet its population needs? Some advocate for more efficient regulatory processes, others for better conditions for financial lending and mortgages, especially now with such high interest rates, others indicate the lack of workforce in the sector as a big barrier for growth, and there is also a need for an increase in the output of materials to get their prices down. The solution is then complex and will need the private sector and the public sector working together to be able to have the affordable and quality housing we need to match our population growth.
Maria Fernandez Ph.D.
Economic Analyst at 3+
 https://www.centreforcities.org/wp-content/uploads/2014/09/08-11-06-Housing-and-economic-development.pdf  https://www.weforum.org/agenda/2022/06/how-to-fix-global-housing-crisis/  https://assets.cmhc-schl.gc.ca/sites/cmhc/professional/housing-markets-data-and-research/housing-research/research-reports/2022/housing-shortages-canada-solving-affordability-crisis-en.pdf?rev=88308aef-f14a-4dbb-b692-6ebbddcd79a0