Non Partisan Association

Implementing a universal 25% net income rent cap within a government-led Housing First framework could provide several significant advantages to the provincial economy. Affordable housing is not just a social program—it is an economic investment with measurable returns.

Benefits to the Alberta Economy

Benefit Category	Economic Impact
Increased Local Spending	Lower rent burdens free up hundreds of dollars monthly that flow into local businesses
Reduced Public Costs	Stable housing reduces emergency shelter and crisis health service expenses
Labor Market Stability	Affordable housing ensures consistent workforce for local businesses
Economic Resilience	Stable households can save, invest, and pursue education
Construction Stimulus	$5.31 in economic activity generated per $1 invested

Increased Local Discretionary Spending

When housing costs are capped at sustainable levels, renters have more disposable income. High rent burdens directly reduce spending power for discretionary purchases in sectors like hospitality, entertainment, and groceries.

A reduction in rent from the standard 30% gross income to 25% net income can save a household hundreds of dollars monthly, which is typically spent immediately back into the local economy. Unlike savings that might flow to out-of-province investments, this spending circulates through local businesses.

Reduced Public Service Costs

Adopting a Housing First philosophy aims to shift the work of governments away from simply managing homelessness toward ending it. Providing stable, permanent housing with necessary wrap-around supports can significantly reduce costs associated with:

• Emergency shelter operations
• Crisis-driven health services and emergency room visits
• Police and justice system interventions
• Temporary assistance programs

Studies consistently show that the cost of providing stable housing is less than the cumulative cost of emergency services for homeless individuals.

Labor Market Stability and Competitiveness

High housing costs can lead to businesses facing higher labor costs as employees demand higher wages to keep up with the cost of living. This can erode a region's overall economic competitiveness.

Stable, affordable housing helps ensure:

• A consistent workforce for local businesses
• Reduced employee turnover and training costs
• Attraction of workers to Alberta communities
• Reduced pressure for wage increases driven by housing costs

Long-Term Economic Resilience

Persistent high rent prices can undermine economic growth by weakening household financial stability and preventing individuals from saving or investing in education and entrepreneurship.

By capping housing costs, the province can foster a more resilient population capable of:

• Wealth accumulation through savings
• Investment in education and skills development
• Starting small businesses
• Contributing to retirement security

Direct Economic Stimulus from Construction

Large-scale government building projects generate significant immediate economic activity. Some estimates suggest that for every $1 invested in affordable housing, approximately $5.31 in total economic activity is generated through a multiplier effect.

This multiplier effect includes:

• Direct employment in construction trades
• Demand for building materials and supplies
• Professional services (architecture, engineering, legal)
• Secondary spending by employed workers
• Ongoing property management employment