Market Rental Housing Affordability and Rapid Transit Catchments: Application of a New Measure in Canada

Abstract

In high-income cities, the availability of affordable rental housing in locations served by fast and frequent public transportation enables low-income households access to more opportunities, including jobs, without the costs of owning and operating automobiles. This study operationalizes a residual income approach to identify market rental housing that is affordable to two household configurations (couples with children and couples without children) in two categories below the median income. The study is carried out on Canada’s least and most expensive major metropolitan housing markets, Montreal and Vancouver. In addition to spatially disaggregating the results into inside and outside rapid transit walking catchments, the results are spatially disaggregated into four zones (Urban Core, Inner City, Inner Suburbs, and Outer Suburbs). Implications of the uneven distribution of affordable rentals with respect to transit access are discussed.

Keywords:

• Housing affordability
• residual income approach
• public transit
• Montreal
• Vancouver

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Erratum

Notes

1. Throughout the text, unless otherwise specified, references to Montreal or Vancouver denote the entire metropolitan area.

2. This was facilitated until recently by immigration policies favoring wealthy business people who tend to locate predominantly in Vancouver and Toronto and favor investments in real estate, but is an effect distinct from immigration per se. Many immigrants have a distinctly different experience, whereby obtaining housing is a formidable challenge, particularly for those arriving in Canada on humanitarian grounds (Carter, 2005; Ley, 2010; Moos & Skaburskis, 2010; Teixeira, 2014).

3. 1 USD was worth approximately 1.10 CAD in 2014 (Bank of Canada, 2015).

4. These income levels are estimates in that the survey is not representative of the population, and therefore the sextiles were calculated by expanding the sample by the associated weight, which is based on the income distribution determined using income tax files. For example, an entry in the data set with a weight of five would be counted five times. Despite this shortcoming, we use the SLID data because it is the only survey to collect data using the definition of disposable income consistent with the MBM.

5. We used the second quintile as we felt this was most in keeping with the principle of the Market Basket Measure that the amount should represent a “modest, basic standard of living” (Statistics Canada, 2013a, p. 9). It was not possible to directly access the averages for the second quintile of income in each province for each household type, as some of the data are considered unreliable due to a small number of survey responses falling into each of these narrow categories.

6. While some have argued that network distance is a more accurate measurement of transit service areas (e.g., Gutierrez & Garcia-Palomares, 2008), others have countered that these differences are not large enough to justify the additional effort and data needed to calculate network distances (Guerra, Cervero, & Tischler, 2012). We therefore deem Euclidean distance to be adequate for our purposes.

7. We consider the SeaBus ferry connecting Waterfront Station in downtown Vancouver with Lonsdale Quay in North Vancouver to be part of the rapid transit network despite its relatively long headways (15 min) because of the travel time savings it imparts in crossing Burrard Inlet and its integration with the SkyTrain network at Waterfront Station. There is no comparable equivalent to the B-Line bus network in the Montreal region.

8. By most accounts, these types of housing assistance are scarce relative to need in Vancouver (e.g., Bula, 2014; Howell, 2014). Meanwhile, over 53,000 Montrealers are on the social housing waiting list, with average wait times of about 4 years, yet the province of Quebec has cut funding for new social housing (Bernstien, 2015).