Navigating the Affordability Challenge in Canadian Real Estate

November 7 2024

Published by Justin George, Managing Partner at Kadus Group

Canada’s housing market is facing an affordability crisis of historic proportions. The average home price is now $754,700, and it takes an estimated 67% of the average household income to service mortgage payments—far above the global affordability benchmark of 30% . This issue is compounded by the rising cost of construction materials, labor shortages, and a housing supply that is failing to keep pace with the country’s growing population.

At Kadus Group, we see these challenges as an opportunity to reimagine housing affordability in ways that are sustainable and impactful. Here are three strategies we’re deploying to address this issue:

1. Mixed-Use Developments

Mixed-use projects that integrate residential, retail, and community spaces not only reduce costs but also build vibrant, self-sustaining communities. For example, studies show that transit-oriented developments (TODs) can lower transportation costs for residents by up to 30%, effectively increasing affordability without reducing quality of life. By strategically incorporating these amenities, we create developments that support local economies and enhance community well-being.

2. Public-Private Partnerships (PPPs)

Collaboration is key to solving the affordability puzzle. Kadus Group works with government agencies, non-profits, and private sector stakeholders to develop affordable housing options within larger projects. For instance, the Canada Mortgage and Housing Corporation (CMHC) estimates that at least 3.5 million new homes will be needed by 2030 to restore affordability . Through partnerships, we’re able to deliver projects faster and with shared accountability, ensuring long-term success for all stakeholders.

3. Innovative Construction & Financing Models

The cost of new builds has surged due to inflation, with material costs rising by 20-30% in recent years. To counter this, we’re leveraging modular and pre-fabricated construction methods that can reduce project timelines by up to 50%, driving down costs. On the financing side, creative models like rent-to-own programs and deferred down payment structures are helping more Canadians achieve homeownership. These approaches allow developers to broaden their market reach while offering equitable opportunities for families to secure stable housing.

The Bigger Picture

Affordability isn’t just about numbers—it’s about creating homes that provide safety, dignity, and opportunity. At Kadus Group, we’re committed to developing housing that balances economic feasibility with social impact. We believe that addressing affordability is not only a moral imperative but also a path to stronger, more resilient communities.

Join the conversation with Kadus Group to explore innovative, scalable solutions for Canada’s affordability crisis. Together, we can redefine what housing can be.