Opinion: Housing and the Economy – The framework of sustainable First Nations

Submitted by the Anishinabek Nation Economic Development Department

The absence of adequate housing in many First Nations is something that you can see in the media on any given day. When we read about housing in First Nations, the focus is usually based on the fact that there is not only a shortage of safe, stable, and affordable housing in our communities, but also that there are not enough homes to support the return of our members to the community. Rarely, if ever, do we hear of or even discuss housing as a major component of our economic development planning.

Now, living under the restrictions over the past year placed on us as a result of the coronavirus disease 2019 (COVID-19) global pandemic, we have become acutely aware of the importance that well-maintained housing has in our communities. Having to spend so much time in our homes has clearly proven that there is a requirement that the housing stock have access to reliable infrastructures such as water, sewer, and electricity; and, the need to work and do schooling from home has identified the importance that access to broadband internet plays in our daily lives. As a result of government shutdowns forcing the closure of workplaces, schools, and economies, the need for a local housing and infrastructure industry has become even more important.

Limiting access to our communities to stop the spread of the virus has also identified the need to have local construction resources, maintenance and repair services, tradespeople, and telecommunications technicians. Though some communities have developed these housing-based economies, we can safely say that there are not many that could build, maintain, or repair their housing stock and infrastructure systems without access to outside expertise. A positive result of the closures and being homebound is that we can easily see how a housing program can stimulate employment and support a local economy in the construction, services, trades, and telecommunications industries.

The 2013 Fact Sheet on First Nation On-Reserve Housing created by the Assembly of First Nations estimated that in 2005, there was a backlog of 80,000 housing units required in addition to the current 107,600 housing units in First Nations. It also went on to state that by 2031, an estimated additional 130,197 housing units would be required to meet community growth. The fact sheet also stated that the average life span of on-First Nation housing was 20 years before major repairs or renovations would be required for the unit to remain viable.

Now, for argument’s sake, let’s assume that the cost to connect to community infrastructure and build a three-bedroom home with finished landscaping in a First Nation is $300,000. If we use the estimated 212,000 housing units, which is required in our communities, that means that the economy related to new housing construction on First Nations is valued at $63.6 billion over 25 years. For many First Nations, most of this money would end up in the hands of suppliers, contractors, and tradespeople from outside of the community, while only a small amount of local labour would be utilized.

According to the ultimate home maintenance guide found on moneysense.ca, you should expect to spend an estimated three to five per cent of the value of a home on repairs and maintenance each year. So, using our cost of $300,000 for the construction of a home, we can expect to spend up to $15,000 each year on repairs, maintenance, and upkeep of the home. Using our figures from above, that would mean that by the year 2031, if there were a total of 317,797 housing units in First Nations, the economy related to repairs and maintenance could be valued in the area of $4.8 billion annually. Again, just as we see in new home construction, most of the suppliers, contractors, or qualified tradespeople who will complete many of these repairs come from outside of our communities.

To add another item to the discussion, if we were to assume that in 2031, 40% of the total housing stock on First Nations was made up of mixed social and market rental housing, the financial gains continue to grow. Let’s assume the rental market is a 50/50 split between social and market-based rents with an estimated $1,000 per month rental cost per unit. If the social housing portion operated at 60% of market rent cost, we could estimate that it would generate about $458 million in rental revenues annually. The remaining market rental units would generate an additional $763 million annually. The total revenue that rental housing would bring to the economy by 2031, would be an additional $1.2 billion per year.

Now let’s assume that the materials suppliers, construction companies, electricians, plumbers, other trades, engineering firms, and networking professionals were all First Nation-owned entities and the housing stock was owned by First Nation enterprises, the estimated gross revenue related to housing of $8.5 billion would be injected into our local, regional, and national economies annually.

By including housing in our education, social, economic, and land-use planning exercises, we can begin down the path to the creation of not only a sustainable economy with housing as a pillar, but we will also be well on our way to creating and supporting vibrant and self-sufficient First Nations economies.

For more information regarding developing First Nation housing programs, policies, and economies, you can get a hold of the Anishinabek Nation Housing Resource Guide by contacting Brandon Manuel via e-mail: brandon.manuel@anishinabek.ca.