Overhousing. It may not be the central issue that comes to mind in the context of the housing affordability crisis, but it is, actually, something we need to be talking about – and working to resolve.
There’s a lot of finger-pointing and there’s a lot of anger over how we ‘got here’ on the housing front. I understand all of it – but I also believe that ranting and raving about it will yield exactly zero results.
I don’t have all of the answers, but I do know that the housing crisis is like a ten-headed monster. We need to battle it accordingly. There are many parts to this beast; overhousing happens to be one of them.
So – let’s talk about overhousing and the role it’s playing the housing crisis.
What is Overhousing?
Overhousing refers to a situation where individuals (or households) occupy a residential property that is significantly larger (or more expensive) than their actual needs. A home’s occupants, in other words, really only need some portion of the space of their home.
How does overhousing happen? Organically, really.
Many factors can contribute. Changes in a household’s size, economics, or lifestyle can be factors. One common scenario is that of “empty nesters.” A person (or couple) raises their family in a home, only to find themselves, at some point, with no kids residing there. Suddenly, that ideal family home is often much larger than necessary. The owners are overhoused. 
Overhousing Implications
Overhousing has many consequences on both individual and societal levels. Economically, it can strain household budgets. Larger homes have higher maintenance costs, utility bills, and property taxes. Those “McMansions” that you see all over the place? They place a very high demand on land and resources, both of which impact the environment and community infrastructure.
From a social perspective, overhousing can contribute to housing scarcity. Large homes are often under-occupied, and many of those owners would welcome the opportunity to downsize… but find that options are few and far between, and pricing is still out of reach, even for a much smaller property.
My parents are in exactly this situation. They still live in the large side-split in Guelph where they raised my brother and I. The house, frankly, is all wrong for them. My mother has mobility issues and the layout and stairs no longer work for her. It’s far too much property – inside and out – for them to manage. However, downsizing to something smaller and better suited for aging in place has proved impossible – at least in Guelph. They feel stuck and, really, they are.
Impact on the Housing Market
So, how does overhousing impact the housing market?
- Reduced Housing Supply: When individuals occupy larger homes than they need, it reduces the availability of housing units for other potential buyers or renters. Reduced supply will always add strain to a tight housing market.
- Affordability: As the demand for larger homes decreases due to changing demographics and economic factors, the demand for smaller, more affordable housing options increases – and so does competition. When we look at things like cost-per-square-foot, often those are much higher with modest, smaller homes than they are with those McMansions I mentioned earlier.
- Reduced Property Tax Revenue: Property taxes are based on the assessed value of homes, but when properties are underutilized, those assessments can be quite low. This can lead to decreased property tax revenue for local governments, potentially affecting funding for public services and infrastructure.
- Increased Urban Sprawl: Overhousing can contribute to urban sprawl, as individuals who want larger properties are forced to seek them out in suburban areas. As a result, our urban footprint expands and that puts additional strain on local resources, increases commuting distances, and can lead to a number of environmental concerns.
We need to address overhousing as an essential part of creating a housing market that is more balanced and sustainable.
So, now what?
Solutions to the Overhousing Problem
As with virtually every contributing factor to the housing crisis, the dilemma of overhousing is going to require a multifaceted approach.
Nothing about overhousing is simple – and nothing about solving it will be simple. Ideas for a path out of this include:
- At the municipal level, conduct housing stock assessments that identify areas with high levels of overhousing. From there, develop targeted strategies designed to address this issue at the local level.
- Find ways to encourage overhoused homeowners to downsize – and this may include financial incentives, tax breaks, or grants. Doing so has the potential to free up larger homes for those who truly need them.
- Push developers to build the kind of properties that overhoused people want (i.e. smaller footprint, adaptable and/or accessible, seniors co-ops, etc.) Part of this will likely involve lobbying governments at all levels to find ways to incentivize these kinds of developments.
- Push governments (but most namely at the municipal level) to develop simpler, less bureaucratic, and less costly ways to assist overhoused people with creating infill. I’m certain that many homeowners would consider duplexing or triplexing their properties, if the process wasn’t so cumbersome and intimidating. We need this infill, but our policies don’t reward people for trying to follow this path. So, let’s work on removing some of the barriers that exist for overhoused people to create infill.
- Push the provincial government to sort out the rental crisis in Ontario. Homeowners won’t jump into duplexing their homes, when they know it’ll take more than a year to resolve a tenant dispute. A massive overhaul of the Residential Tenancies Act and the tribunal system is in order. Immediately.
- Look at taxes. No one wants to pay higher taxes – ever. I get it! But, the reality is that property tax reform may be key to solving some of the issues leading to the housing crisis – including overhousing. A progressive property tax system could be put into place and could be effective in discouraging people from retaining underused or vacant properties, for example.
The housing crisis is all most of us seem to be talking about lately, but it’s not a problem that just creeped up on us. Decisions have been made at all levels of government over the last five decades – and those decisions have led us to the crisis point we’re at today. No one level of government caused it; no one level of government can fix it. The ten-headed monster won’t a battle easily won, but if we attack it bit by bit, problem by problem? We can win it.
Let’s go.
