ANALYSIS: Taboo on Immigration Talk Slowly Lifting as Housing Remains Hot Political Issue

ANALYSIS: Taboo on Immigration Talk Slowly Lifting as Housing Remains Hot Political Issue
Prime Minister Justin Trudeau and Conservative Leader Pierre Poilievre greet each other in the House of Commons on Parliament Hill in Ottawa on Sept. 15, 2022. (The Canadian Press/Sean Kilpatrick)
Noé Chartier

“Supply, supply, supply” has been the mantra of both Liberals and Conservatives to address the housing crisis. However, both have now begun to talk more openly about the impact immigration is having on the demand side of the equation.

While the Liberals have remained publicly committed to their regular immigration targets, they’ve recently admitted that temporary forms of immigration, especially those pertaining to international students, are “out of control.”

The government brought in measures this week to reduce the number of foreign students allowed to enter Canada for two years, suggesting the new limits could help reduce pressure on housing in some communities.

The two main political parties consider immigration a growth engine, a historical trait for Canada and a fact of life in the context of falling birth rates. It’s also a sizeable source of votes that neither party wants to alienate.

Conservative Leader Pierre Poilievre has put the housing issue at the core of his affordability message and last summer raised questions about immigration and housing. He decried the conditions some refugees were experiencing and blamed Minister Sean Fraser, who had just been shuffled from immigration to housing in July 2023.

Mr. Poilievre said in August 2023 that Mr. Fraser was responsible for “putting refugees under bridges and in our streets,” alluding to the situation in Toronto, and for overseeing the “massive human tragedy of our international student program,” with fake institutions defrauding students. Asylum seekers in Toronto have slept in the streets in recent months due to the overcrowding of the shelter system.

The Tory leader promised a “common sense” policy on immigration that would be driven by the number of vacancies in the private sector, the number of charities that can sponsor refugees, and family reunification.

Mr. Poilievre refrained from commenting on the government’s immigration targets, which are approximately 500,000 new permanent residents per year until 2026, but said he would ensure newcomers have housing and health care if he becomes prime minister.

A few months later, he went further, saying immigration should be tied to Canada’s capacity to accommodate newcomers’ housing and social needs.

In a year-end interview with True North’s Andrew Lawton aired Dec. 18, 2023, Mr. Poilievre was asked whether he accepts that “immigration is inflaming the housing crisis.”

Mr. Poilievre answered that it’s “very simple math” that increasing the flow of newcomers without having enough housing for them drives up housing prices. He refrained from indicating what his immigration target would be, but emphasized that immigration should be linked to housing, health care, and jobs.

“The growth in immigration should not exceed the amount of housing stock we add, the number of doctors we add, and the available jobs,” he said, noting this would be part of his electoral platform.

“It will be mathematically driven, not by arbitrary targets to generate virtue-signalling headlines as we have right now.”

‘Mysterious’ Proposal

On Jan. 23, Prime Minister Justin Trudeau skirted around a media question about whether immigration could be tied to housing.

“We need to make sure that the system is working in the rigorous ways that it always has,” he said. “Being able to welcome in people from around the world particularly at this time of labour shortages is good for our country and good for the future that we’re building together.”

While Mr. Trudeau didn’t address the issue directly, other relevant Liberal ministers have. Mr. Fraser said on Jan. 15 that tying immigration to the number of homes available is a good one. “It’s one of the factors that we’ve considered over the past number of years,” he said.
Immigration Minister Marc Miller, who took over from Mr. Fraser in late July 2023, said on Jan. 16 that it’s self-evident Canada needs to have the capacity to welcome newcomers, but he called Mr. Poilievre’s proposal to link immigration and housing “mysterious.”

“I’m expecting a plan but it takes serious leadership, and what he’s proposing is not serious,” said Mr. Miller.

The immigration minister spoke candidly in recent days about the international students issue he’s trying to address. On Jan.22, he announced a two-year cap on visas for foreign students to bring down the number by 35 percent from the nearly 560,000 such visas issued last year.

Mr. Miller said the move could help bring down rents, but the main reason for the measure is to “stop a system that’s out of control.”

“We’ve got two years to actually get the ship in order. It’s a bit of a mess and it’s time to rein it in,” he said.

Mr. Fraser also said on Jan. 22 that the newly announced temporary cap on international students could help alleviate housing market pressures in some communities. He’s been very critical about some unspecified private schools abusing the system to make money and said he hopes some of them are shut down.

Along with trying to fix the international students issue, the Liberal government is looking into the dramatic increase in asylum seekers from Mexico, many of whom have weak claims. This comes as a consequence of the visa requirements being lifted as part of the renegotiated trade agreement with Mexico.

Mr. Miller said he needs to “turn the screws a bit” on the system and that talks are underway with Mexico. Meanwhile, the Conservatives have outright called for visa requirements to be reinstated on visiting Mexican nationals.

Banks’ Concerns Over High Immigration

Canada’s big banks have raised serious concerns about the impact of government decisions on immigration.
Economists at the National Bank wrote in a Jan. 15 report that Canada was in a “population trap” for the first time in its history. They described the phenomenon as one typically only seen in emerging economies and as a situation where living standards cannot grow due to rapid population growth.

“Our country’s current population growth appears extreme relative to the absorptive capacity of the economy and the fact that our workforce is not aging faster than the OECD average,” the report says. “Nowhere is this absorption challenge more evident than in housing.”

A report from TD Bank in July 2023 said that the rapid population growth has helped the labour market but that it “risks coming at a cost of worsening dislocations in other segments of the economy.” TD warned that pursuing the high-growth immigration strategy could increase the lack of housing while government policies are unlikely to help solve the issue.
The Canadian public has not remained indifferent about immigration either, with attitudes changing substantially in recent months. A Nanos poll conducted in late December suggested 61 percent of Canadians want the country to accept fewer immigrants, an 8 percent increase compared to September 2023.