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Canada needs another 3.5M housing units built by 2030: CMHC

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Canada still needs another 3.5 million housing units by 2030 on top of what it’s on track to build by that point, a new report says.

But an economist for the Canada Mortgage and Housing Corp. (CMHC), which authored the report, says this goal may not even be attainable.

The CMHC provided an update Wednesday to another report it released in June 2022 on housing shortages and affordability.

The CMHC says it still projects that the country would need approximately another 3.5 million housing units in order to meet 2004 levels of affordability, or the share of after-tax income that a household with an average income would need to buy an average home.

“We need to get a lot of stuff built,” CMHC deputy chief economist Aled ab Iorwerth said Wednesday on The Vassy Kapelos Show.

While this “housing supply gap” remains relatively unchanged, the CMHC writes that the size of the gap has changed across provinces, with Ontario expected to have lower household income growth and, therefore, a reduced demand for housing. The opposite, meanwhile, is expected in Quebec and Alberta.

Iorwerth said the debate now is “not so much whether we increase supply, but how do we do it quickly.”

But asked if he believed building another 3.5 million housing units by 2030 is possible, Iorwerth responded, “No, but it’s the right question to ask.”

“Housing affordability is a clear problem for all Canadians, but it’s going to take a lot of time, a lot of effort, a lot of policy innovation, a lot of innovation by the business sector to fix it,” he said.

“The problem is not going away. Responding to it, it’s going to take time, but I think this is clearly now a priority for all Canadians.”

Appearing on CTV’s Power Play on Wednesday, Housing Minister Sean Fraser also responded to the CMHC report on the supply gap of 3.5 million units.

“Look, that’s my goal,” he said. “I should say that some of the measures that we’re working on now we’ll have to further refine to understand the precise impact that they’re going to have. But I have no interest in stopping short of solving Canada’s national housing crisis and restoring a level of affordability that allows ordinary people to be able to find a place that they can actually afford.”

Asked whether he believed building another 3.5 million units was even possible, Fraser said,” I don’t believe that it’s impossible, I believe it will be difficult.”

While immigration to Canada is currently higher than forecast, the CMHC says the number of households required to achieve affordability will not be significantly higher in 2030 compared to its previous projection.

Iorwerth said many factors drive up demand for housing, including immigration, but also rising incomes and lower interest rates.

“The challenge we’re facing is the supply … has not been responding for many years,” he said.

“So for whatever reason demand is going up, we need the supply response both to accommodate new immigrants, but also to improve the affordability of housing for Canadians or people who are already here, because we’re starting to have a situation with a lot of risks.”

On Wednesday, Prime Minister Justin Trudeau announced a $74-million deal with London, Ont., to fast-track more than 2,000 housing units over the next three years under the federal Housing Accelerator Fund, with thousands more planned in the following years.

The federal government says this will include high-density development, as well as duplexes, triplexes and small apartment buildings.

The $4-billion Housing Accelerator Fund aims to create 100,000 new housing units by encouraging municipalities to update their zoning and permit systems to fast track residential construction.

On the latest CMHC report, Trudeau said, “We’re facing a shortage of housing right now and that’s why prices of homes have become far too high … Housing in big cities around the world has already become out of reach for many … Places like New York, Paris, London, San Francisco, but we’re not going to follow those examples.”

With files from CTV News Senior Digital Parliamentary Reporter Rachel Aiello

 

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Telus prioritizing ‘most important customers,’ avoiding ‘unprofitable’ offers: CFO

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Telus Corp. says it is avoiding offering “unprofitable” discounts as fierce competition in the Canadian telecommunications sector shows no sign of slowing down.

The company said Friday it had fewer net new customers during its third quarter compared with the same time last year, as it copes with increasingly “aggressive marketing and promotional pricing” that is prompting more customers to switch providers.

Telus said it added 347,000 net new customers, down around 14.5 per cent compared with last year. The figure includes 130,000 mobile phone subscribers and 34,000 internet customers, down 30,000 and 3,000, respectively, year-over-year.

The company reported its mobile phone churn rate — a metric measuring subscribers who cancelled their services — was 1.09 per cent in the third quarter, up from 1.03 per cent in the third quarter of 2023. That included a postpaid mobile phone churn rate of 0.90 per cent in its latest quarter.

Telus said its focus is on customer retention through its “industry-leading service and network quality, along with successful promotions and bundled offerings.”

“The customers we have are the most important customers we can get,” said chief financial officer Doug French in an interview.

“We’ve, again, just continued to focus on what matters most to our customers, from a product and customer service perspective, while not loading unprofitable customers.”

Meanwhile, Telus reported its net income attributable to common shares more than doubled during its third quarter.

The telecommunications company said it earned $280 million, up 105.9 per cent from the same three-month period in 2023. Earnings per diluted share for the quarter ended Sept. 30 was 19 cents compared with nine cents a year earlier.

It reported adjusted net income was $413 million, up 10.7 per cent year-over-year from $373 million in the same quarter last year. Operating revenue and other income for the quarter was $5.1 billion, up 1.8 per cent from the previous year.

Mobile phone average revenue per user was $58.85 in the third quarter, a decrease of $2.09 or 3.4 per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in overage and roaming revenues.

It said customers are increasingly adopting unlimited data and Canada-U.S. plans which provide higher and more stable ARPU on a monthly basis.

“In a tough operating environment and relative to peers, we view Q3 results that were in line to slightly better than forecast as the best of the bunch,” said RBC analyst Drew McReynolds in a note.

Scotiabank analyst Maher Yaghi added that “the telecom industry in Canada remains very challenging for all players, however, Telus has been able to face these pressures” and still deliver growth.

The Big 3 telecom providers — which also include Rogers Communications Inc. and BCE Inc. — have frequently stressed that the market has grown more competitive in recent years, especially after the closing of Quebecor Inc.’s purchase of Freedom Mobile in April 2023.

Hailed as a fourth national carrier, Quebecor has invested in enhancements to Freedom’s network while offering more affordable plans as part of a set of commitments it was mandated by Ottawa to agree to.

The cost of telephone services in September was down eight per cent compared with a year earlier, according to Statistics Canada’s most recent inflation report last month.

“I think competition has been and continues to be, I’d say, quite intense in Canada, and we’ve obviously had to just manage our business the way we see fit,” said French.

Asked how long that environment could last, he said that’s out of Telus’ hands.

“What I can control, though, is how we go to market and how we lead with our products,” he said.

“I think the conditions within the market will have to adjust accordingly over time. We’ve continued to focus on digitization, continued to bring our cost structure down to compete, irrespective of the price and the current market conditions.”

Still, Canada’s telecom regulator continues to warn providers about customers facing more charges on their cellphone and internet bills.

On Tuesday, CRTC vice-president of consumer, analytics and strategy Scott Hutton called on providers to ensure they clearly inform their customers of charges such as early cancellation fees.

That followed statements from the regulator in recent weeks cautioning against rising international roaming fees and “surprise” price increases being found on their bills.

Hutton said the CRTC plans to launch public consultations in the coming weeks that will focus “on ensuring that information is clear and consistent, making it easier to compare offers and switch services or providers.”

“The CRTC is concerned with recent trends, which suggest that Canadians may not be benefiting from the full protections of our codes,” he said.

“We will continue to monitor developments and will take further action if our codes are not being followed.”

French said any initiative to boost transparency is a step in the right direction.

“I can’t say we are perfect across the board, but what I can say is we are absolutely taking it under consideration and trying to be the best at communicating with our customers,” he said.

“I think everyone looking in the mirror would say there’s room for improvement.”

This report by The Canadian Press was first published Nov. 8, 2024.

Companies in this story: (TSX:T)

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TC Energy cuts cost estimate for Southeast Gateway pipeline project in Mexico

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CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.

It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.

The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.

Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.

TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.

The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:TRP)

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BCE reports Q3 loss on asset impairment charge, cuts revenue guidance

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BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.

The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.

On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.

“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.

“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”

Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.

BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.

The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.

BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.

It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.

The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”

Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:BCE)

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