Canada has enjoyed a surging real estate market for almost a decade, with record home sales and appreciating prices. But the Federation of Canadian Municipalities (FCM) warns that "finding adequate housing (is) becoming an issue even for the so-called middle class and chronic, systemic homelessness continues in Canada's urban areas."

"Too many Canadians are forced to choose between food and rent, clothes for the kids or making the mortgage payment," says Sam Sullivan, mayor of Vancouver and co-chair of the FCM Big City Mayors' Caucus. "The high cost of housing also undermines the ability of people who want to get ahead but cannot afford a secure and decent place to live."

In a study of housing and homelessness from 2001 to 2006 in 22 large and medium-sized urban centres, FCM found that house prices outpaced income growth, "even for couples and two-parent families.

"Income growth was far slower among lone-parent families and single people, who faced serious and growing barriers to affordable home ownership," says FCM.

Recently Statistics Canada released a report called, The Dynamics of Housing Affordability . It profiles people who are spending 30 per cent or more of their household income on shelter (rent or mortgage payments, property taxes, condominium fees and utility payments). "The 30 per cent level is commonly accepted as the upper limit for affordable housing," says the report.

It found that 20 per cent of Canadians live in households that spend above the affordability benchmark for shelter in any single year. During the three years of the study, 28 per cent reported exceeding the benchmark at some point.

"The attributes associated with the highest probability of exceeding the benchmark were: living alone, being a female lone parent; renting; being an immigrant; or living in Vancouver or Toronto," says the Statistics Canada report.

Those who experienced some kind of transition, such as changing from owner to renter or vice versa, or those who got married or divorced, were also most likely to move above or below the affordability benchmark.

Homelessness is also a growing issue, says FCM. "In 2006, even small and suburban communities ... required emergency shelters," with close to 20,000 permanent shelter beds across the 22 communities studied, it says.

The federation has come up with an Action Plan to address the problem. It calls on the federal government to make a renewed funding commitment to housing, because the current federal housing fund program will expire in March 2009.

The FCM says chronic homelessness could be eliminated in 10 years if 20,000 new transitional, supportive and permanent affordable housing units are made available, along with support for underlying issues such as mental health and addiction.

It says the stock of affordable non-market housing must expand by 15 per cent of the total annual housing starts per year. The FCM says this is an estimated 25,000 to 30,000 units per year, which could include new construction and acquisition and preservation of existing market units.

The third FCM recommendation is that an existing backlog in core housing need be reduced by 25 per cent over 10 years, which amounts to 35,000 households per year. It also calls for Canada's existing housing stock to be preserved and modernized at the rate of 20,000 units per year, and that existing subsidies be renewed.

Finally, the FCM says the Residential Rehabilitation Assistance Program, which provides homeowners and landlords with funds to help maintain their homes, should be extended and revised to rehabilitate 10,000 homes a year.

How much will all this cost? The FCM says it will be $3.35 billion a year, to be shared by all levels of government.

"However, this is not new money," says the report. "Much of this is already being invested and is scheduled to end in 2009." It says renewing current programs would raise $2 billion over two years, and most of those funds are matched by the provinces and territories. "This can be augmented by reinvesting spending from expiring social-housing operating agreements (federal expenditures are currently $100 million annually and would rise gradually over the next 10 years to $500 million annually)" and would also be matched by the provinces.

The FCM says the figures don't include revenues generated by the housing market activity, which it estimates to be more than $500 million in tax revenue for the federal government and $175 million for the provincial and territorial governments.

"There is no choice. The federal government must put an end to the chronic uncertainty around affordable housing in this country and play a strong leadership role by committing to a long-term strategy," says FCM President Gord Steeves. "We are proposing an ambitious but realistic plan to address the most pressing problems."