The fragile state of student housing

As the housing crisis continues to cause widespread confusion and frustration across Canada, university students are giving up on convenience as they struggle to find even the most basic affordable housing.

This year, housing uncertainty overshadowed a back-to-school season already marked by a drastic drop in international student enrolment. “It was a bit surprising how much housing dominated the conversation, although it wasn’t unexpected that it would be a topic,” says Andrew Parr, associate vice-president of student housing and community services at The University of British Columbia (UBC). “This crisis is not exclusive to universities. It’s not exclusive to British Columbia or to UBC. It’s a national crisis.” In Alberta, 3,000 residence spots are available to University of Calgary (U of C) students, but even so, more than 1,000 students were waitlisted. Shane Royal, U of C’s senior director of ancillary services, noted that the crisis has worsened in recent years. “Before COVID, U of C had no waiting lists or anything of the kind, but things have started ramping up. We’ve had waiting lists of up to 1,000 people for the last two years.” Even as classes began, dozens of students remained on the wait list as of September. “Numbers decreased because the university called people to let them know we probably didn’t have room for them on campus and that they should look elsewhere,” says Mateusz Salmassi, vice president external of U of C’s Student Union.

A crisis long in the making

Louis Gaudreau, a sociologist in the department of social work at Université du Québec à Montréal (UQAM), argues that the housing crisis has been brewing for two decades and “only became much more pronounced” in the last two to three years. He notes that the housing crisis in Canada, and Quebec in particular, is not rooted solely in the current shortage of housing as one might assume. Rather, the real issue is affordability. This was true well before supply became a significant problem. “Prices started rising swiftly before there was a housing shortage,” says Mr. Gaudreau. “This was largely caused by the massive influx of capital into the real estate market, especially from banks.” A survey from the Student Housing Initiative earlier this year supports these observations. Sixty per cent of surveyed students said off-campus rent wasn’t affordable.

“Students are much more stressed. They’ve had a lot more to worry about than just their exams.”

“Students are much more stressed,” says Mr. Salmassi. “They’ve had a lot more to worry about than just their exams. Many are coming to class hungry because they’re spending so much on rent and tuition that they can no longer afford enough food.” Students are having to make more compromises in general. Some compromise their safety to live near campus. Others live in neighbourhoods poorly served by public transit, far from the university, which can result in daily commutes of 90 minutes to two hours and create barriers to school-life balance.

This situation is not unique to Calgary. A study from Desjardins Financial Group revealed that students and their families are worrying about the quality and safety of available housing across the country. The outsized financial burden is often pushing students to take out loans and incur other forms of debt. According to Desjardins, in 2020, a college graduate’s average debt was $16,700, while university graduates owed an average of $30,600. The recent interest rate hike has increased monthly debt payments, while rising inflation is making basic expenses like housing and food more costly. These are all factors complicating young adults’ budgets.

Off-campus housing: a regrettable necessity

Much like the general population, students are entering the off-campus rental market out of necessity, driven to it by a lack of available places in university residences. As a consequence, these students are missing out on much that university life has to offer, including quality personal and academic relationships, as well as countless other opportunities. A recent study from BONARD, an international education market analysis firm cited in the Desjardins report, noted that the number of available places in residences corresponds to only 10.3 per cent of the total number of registered students. Experts posit that upwards of 60 per cent of students should have the option of student housing. Waterloo, Ont. leads Canada in student housing, with 35 per cent of its student population housed in university residences. Yet the municipal town and gown committee, which facilitates the relationship between the city and the University of Waterloo, reported that 63 per cent of surveyed students had difficulties finding housing. Forty-five per cent, meanwhile, said their expenses were higher than anticipated.

As a result, students are at the mercy of landlords renting apartments near the university who raise prices to profit from their vulnerability. According to Mr. Gaudreau, who closely monitors the rental scene in downtown Montreal, where UQAM, McGill and Concordia have campuses, “a student housing market has emerged in Montreal that especially targets out-of-province and international students. Rents are often considerably higher than for family housing or apartments in other neighbourhoods.” Over the pandemic, some landlords did not rent out their apartments, preferring to wait for international students – a more profitable clientele – to return.

This aligns with the situation in Calgary, where international students and other marginalized communities are often left to fend for themselves. These demographics are particularly vulnerable, says Mr. Salmassi, as most of them don’t have local support systems. Those without family in Canada are more susceptible to being scammed or accepting poor housing conditions. He remembers a case where 15 people lived together in a house with only two bathrooms and one kitchen – an unsafe and unsanitary situation. Some people consider themselves “lucky” to pay $650 for a room, despite having to share living space with other students. This precarity is not limited to international students. About nine per cent of students from within Calgary live in unsanitary conditions, says Mr. Salmassi. Members of the 2SLGBTQIA+ community who have been rejected by their families also face difficulty securing safe and affordable housing.

UBC’s Andrew Parr is aware that the question of housing is also a matter of survival for the universities themselves. “Students are making decisions about where to study based on the availability of stable, affordable, and nearby housing rather than based on academic program or their preferred university. If a region or an institution has no available housing, students will go elsewhere. It’s a huge concern.”

Over the coming years, UTILE aims to build between 600 and 800 new student housing units annually. Though this doesn’t meet the total need, these efforts will make a considerable difference in the province of Quebec. The organization’s main goal is to reintroduce balance into major urban housing markets and to integrate housing construction into a larger strategy to address the crisis. They also aim to attract government attention to their initiative. With the construction of new student housing, units are freed up within the general housing market. Inspired by European models, UTILE hopes to spread the non-profit model to other Canadian provinces and position it as an effective midpoint between university residences and private housing.

A costly and difficult challenge

As a result, housing is occupying a central role in universities’ expansion and growth plans. Mr. Royal noted that U of C revised their housing plan last year to anticipate needs over the next seven to 10 years. U of C expects to grow their student population by 10,000 before 2030. “We studied registration growth and student housing needs,” he says. He notes that the plan’s first steps have already been implemented and that the university is in the process of designing and budgeting for new buildings. Though he wasn’t able to provide details at this stage, he confirmed that concrete projects were underway to respond to the future housing needs associated with the university’s registration goals.

Out west, UBC aims to improve access to affordable housing on its Vancouver campus by constructing a new residential complex. The provincial government is providing $300 million for the project, while UBC will finance the remainder of its $559.9 million total cost. This is the largest contribution from the provincial government to a single housing project in the university’s history. “One thing we’ve learned – not directly related to the developments themselves – is that the more we build and the higher the quality of the environments we create, the more students want to live there,” says Mr. Parr.

UBC’s strategic plan, Campus Vision 2050 – an update to its 2010 plan – places a major emphasis on housing. Students, professors, staff and the surrounding community were heavily involved in consultations. Housing featured prominently in the feedback, not only among students but likewise among professors and staff. Affordable housing is also relevant to them, as UBC is surrounded by some of Canada’s most expensive properties. Mr. Parr notes that UBC’s ambitions will undoubtedly encounter many roadblocks. “Our biggest challenge is rising construction costs. Five years ago, each bed cost between $130,000 and $150,000. Today, it’s more than doubled to over $300,000 per bed.” The province’s subsidy of $300 million is critically important to the new student housing project. Together with the university’s contribution, 1,500 new beds have been financed. Higher construction costs complicate the financial viability of such projects, as rental income cannot rise high enough to cover them. Mr. Parr is exploring alternative solutions. Options include partnering with third-party sponsors or with the Musqueam community to construct housing on their territory. Despite these challenges, Mr. Parr remains convinced that UBC’s internal housing model of constructing, managing, and owning these residences is the best solution for the university.

“Students are making decisions about where to study based on the availability of safe, affordable, and nearby housing rather than based on academic program or their preferred university. If a region or an institution has no available housing, students will go elsewhere.”

Student associations are also getting involved. U of C’s student union is collaborating with places4students.com to put students in touch with local landlords and promoting the initiative across Calgary. The union also played a key political role in the city’s adoption of a new housing strategy that sets aside $25 million for downtown student housing. “It’s a step in the right direction,” says Mr. Salmassi. Though federal funds have been allocated to housing construction, the government of Alberta has yet to invest.

In Quebec, the Unité de travail pour l’implantation de logement étudiant (UTILE) is a case study in how partnerships can make a difference in the housing crisis. Formed in 2013, UTILE is a non-profit committed to developing affordable and sustainable student housing in urban centres, where the housing shortage is particularly acute. UTILE collaborates with universities, cities and private partners, and has already brought several projects to fruition in cities across the province.

“We are developers, operators and landlords,” says Laurent Levesque, CEO of UTILE. “Because we handle land purchase, financing, development, construction and management, we’re able to offer turnkey properties. It’s a real 360 degree model.” UTILE’s vision is based on two central pillars. The first is affordability at the outset. The units must be rented below market rate – more specifically, below new build market rate — and adapted for student budgets. The second pillar is affordability over time. Rent increases are kept to a minimum – generally around two to three per cent per year. This is well below market rate, which can climb up to 15 per cent.

The organization is currently constructing 1,500 units in Montreal, Quebec City, Sherbrooke, Trois-Rivières, Rimouski, and other cities throughout Quebec.

Mr. Levesque highlights the essential role diversified partnerships play in responding to student housing needs. Different universities adopt different strategies; those seeking collaborative partnerships are natural allies with his organization. He also observes that the major Quebec universities within his organization are increasingly recognizing that they aren’t able to manage everything alone.

The student housing crisis in Canada highlights the importance of adopting a collaborative approach between universities, governments, and private sector partners. As challenges related to affordability and availability continue to impact student well-being, these innovative partnerships provide a glimmer of hope for sustainable solutions. However, further efforts are still needed to restore campuses to their primary role as spaces for learning, personal development, and community life for everyone.

According to Louis Gaudreau, a sociologist teaching in the department of social work at Université du Québec à Montréal, bank investment in residential real estate quintupled from $400 billion to $2 trillion in the 2000s. The result was an imbalance between the supply of capital and investment opportunities. The resulting financial pressure caused a sharp spike in prices and boosted construction in major urban centres, which has exacerbated the current crisis. Construction alone cannot address the problem unless prices are regulated.