The conservative leader is redefining how to use social media for political purposes. His new 16-minute video entitled “Housing Hell,” which Pierre Poilievre himself calls a “new documentary,” has been viewed millions of times.
The Conservative leader's thesis summarized: Justin Trudeau and his government are solely responsible for the housing crisis and exorbitant real estate prices in Canada, and only Pierre Poilievre can provide relief.
The journalistic-looking format was convincing. But three independent economists consulted by Radio-Canada raise warning signs.
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The economist and former deputy federal minister Louis Lévesque, professor at the School of Management Sciences at UQAM Florian Mayneris and the independent economist Jean-Pierre Aubry
Photo: Radio-Canada editorial team and Florian Mayneris
According to them, Pierre Poilievre's statements contain exaggerations, problematic and embarrassing omissions and simplistic arguments.
Conclusions from our economists: The comments in this documentary do not always reflect reality and represent a distortion of the real causes of the housing crisis.
Attention: Not everything in the conservative video is wrong. Many of the facts and statistics mentioned are verified, proven and documented.
First, the real facts
The economists surveyed agree: Pierre Poilievre has understood the problem of the real estate crisis in Canada very well. As the conservative leader explains in his video, it's true:
- On average, property prices in Canada have risen sharply.
- the increase is greater than for other OECD countries;
- Vancouver and Toronto are among the least affordable cities in the world;
- Canadian population growth far outpaces new home construction;
- Today, young people have more difficulty becoming property owners compared to their parents or grandparents.
The video effectively illustrates the scale of the problem, admits Louis Lévesque, a former deputy federal minister. The diagnosis made regarding the consequences of this housing crisis, especially among young people, is correct, believes Florian Mayneris, professor at the School of Management Sciences at UQAM.
It is an effective format for convincing people, believes independent economist Jean-Pierre Aubry. But these are factual elements whose meaning is greatly exaggerated, adds Louis Lévesque.
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A construction worker works from an elevator in a new housing development in Ottawa.
Photo: The Canadian Press / Sean Kilpatrick
Mr Poilievre assumes an extreme and temporary situation and says it is a permanent situation. I blame him for lacking honesty.
In the video, the Conservatives use recognized data from the Fraser Institute, the Montreal Economic Institute and UBS Bank. But other statistics presented by the conservatives are raising eyebrows among the economists surveyed.
He gives a lot of numbers, but the studies are not always named, notes Florian Mayneris.
Missing sources
For example, at 2:38 of the video, the Conservative leader says that the average one-bedroom rent, average mortgage payment and down payment on an average home have doubled since Justin Trudeau was elected in 2015.
However, without mentioning where these statistics come from.
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Screenshot of Pierre Poilievre's video
Photo: Screenshot from Pierre Poilievre's video.
Radio-Canada has asked Pierre Poilievre's office to clarify the sources used to support these claims. We did not get an answer.
After reviewing the Canada Mortgage and Housing Corporation (New Window) (CMHC) database, the numbers presented by the Conservatives appear to be inaccurate:
The price of an average one-bedroom rental increased from $851 to $1,147 between 2015 and 2022 (a 21% increase).
The average monthly mortgage payment increased from $1,232 to $1,922 between 2015 and 2023 (a 56% increase).
These figures have therefore not doubled since 2015, contrary to what the Conservative leader claims, even considering that property prices vary enormously depending on the region and type of property.
In the thirtieth second of the video, Pierre Poilievre explains that Canadians pay 66% of their average monthly income on payments for an average house. Without specifying the source of this information, neither in the video nor at our request.
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Screenshot of Pierre Poilievre's video
Photo: Screenshot from Pierre Poilievre's video.
However, according to CMHC data, the average cost of repaying your mortgage loan in Canada is still $1,922 per month. The average Canadian income before taxes is $63,181 (or $5,265 per month).
Additionally, if we consider households rather than individuals, the average income rises to $70,333 per year.
So, based on these numbers, Canadians on average pay between 33% and 36% of monthly income (before taxes) on their mortgage, rather than 66% as Pierre Poilievre claims.
The causes of the increase
In the video, Pierre Poilievre points out that if the price of homes in Canada is unaffordable, it is due to a number of factors directly under the control of the Liberal government.
According to economists interviewed, the facts selected by the Conservative leader are arbitrary and paint an incomplete picture of the situation, with the aim of placing all the blame on Justin Trudeau.
In fact, the reality is more complicated.
There are two observations from the Conservative leader in particular that raised eyebrows among economists surveyed.
Find #1
As the government borrows more, the cost of the goods we buy and the interest we pay rise. Due to the Trudeau government's deficit and record debt, real estate prices have become unaffordable.
Verdict : That's not the whole truth, economists say.
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Housing, Infrastructure and Communities Minister Sean Fraser prepares to speak at an announcement outside a rental apartment building being developed by the University of British Columbia Properties Trust on Wednesday, August 16, 2023, in Vancouver.
Photo: The Canadian Press / Darryl Dyck
Cause and effect are not so simple, claims Louis Lévesque. This is not just about the federal government's financial policy.
On the contrary, adds Florian Mayneris, the rise in property prices was partly boosted by the sharp fall in interest rates, which allowed buyers to take out higher mortgages.
This decline in interest rates began before the Liberals. So there is an argument from Pierre Poilievre that seems neither very clear nor very fair.
Find No. 2
Of all the G7 countries, Canada has the largest area per person. Why is housing more expensive than ever before and almost everywhere else?
Verdict : According to Louis Lévesque, the statement is somewhat ridiculous.
Canada has a lot of space, but it's not very livable, recalls Jean-Pierre Aubry. There are places where economic activity does not allow for a large number of inhabitants per square kilometer.
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From construction to Toronto
Photo: Radio-Canada / Patrick Morrell
In addition, the space around large cities such as Toronto and Vancouver is limited, adds Florian Mayneris, who examined the topic for a study with Statistics Canada. In Vancouver, for example, the space between the sea and the mountains is limited, he says.
Land availability in already densely populated areas where people want to live is not as important as Mr. Poilievre's video seems to suggest.
According to our economists, it is true that the current housing crisis is partly related to the actions (or inactions) of the current administration, such as raising immigration thresholds, low construction of new homes, or recording federal government spending and debt.
But it would be wrong to say that the housing crisis began when the Trudeau government took office in 2015, experts point out. Remember, they say, the economic crisis of 2008, which was precisely caused by real estate speculation.
Omissions
According to our economists, Pierre Poilievre's analysis of the causes of the housing crisis contains two glaring omissions.
Omission #1 : the pandemic
Florian Mayneris emphasizes that what is deeply embarrassing is that he doesn't talk about the pandemic at all.
The pandemic has led to lower interest rates, higher material costs and a labor shortage. Factors that have all contributed to the rise in property prices.
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A warehouse in front of the colonial building Saint-Jean, NL, Friday December 1, 2023.
Photo: The Canadian Press / Sarah Smellie
However, the only allusion to the pandemic in Pierre Poilievre's video is an image of Chief Medical Officer Theresa Tam, who we see for a split second at 2:27.
Two thirds of the increase in debt is related to the pandemic, says Jean-Pierre Aubry. You can't say a word about it or ignore the fact that other countries are going through a similar situation to us.
“Here we are dealing with the complete omission of a fundamental element of context, which is largely problematic,” concludes Professor Mayneris.
Omission #2 :L'Immigration
According to Louis Lévesque, there are two million more people in Canada due to immigration and no housing has been built for them. So we have aggravated the situation and increased tensions in the real estate market.
But Pierre Poilievre doesn't talk about it, emphasizes Louis Lévesque. The Conservative Party is strongly courting cultural communities, he says, and wants to avoid alienation from them.
I don't think many federal political parties want to anger immigrant communities in Canada as an election approaches.
The solutions
Towards the end of his video, Pierre Poilievre explains how he plans to solve Canada's housing crisis. According to him, obtaining permits needs to be accelerated by relaxing certain regulations at the municipal level. He's right, say our economists.
The procedures for obtaining building permits and the regulations are restrictive, says Florian Mayneris. But that won't solve everything. Projects don’t just magically appear out of the ground.
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In April, police forces were called to oversee the removal of tents and buildings from encampments in downtown Vancouver, British Columbia.
Photo: The Canadian Press / Darryl Dyck
Pierre Poilievre also suggests funding cities only for completed projects and penalizing those who fail to meet their new construction target.
A simple solution that is not valid, according to our experts.
Because sometimes it is the real estate developers who are responsible for the slowness of projects due to financing reasons or a lack of labor.
If Pierre Poilievre only gives cities money for new projects (instead of helping them build them), we could punish them for things they are not responsible for.
Final note
In short, the explanations that Pierre Poilievre presents to Canadians to blame Justin Trudeau alone for the housing crisis have not convinced our economists.
Jean-Pierre Aubry emphasizes that he succeeds well in capturing people's fears. But the content is poor. He is exaggerating. This is very poor quality information for Canadians.
The grade in political science would be higher than in economics.
Mr Mayneris added: “This is not what we ask of our students.”
As an economist, there are arguments that are not balanced. There are inaccuracies and errors in reasoning that are not necessarily based on good analysis.