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Owen Sound’s Housing Problem – Part I
Wages in general are just not keeping up with the cost of housing in
most communities. However, in communities like Owen Sound low
household incomes coupled with rising costs make it particularly
difficult for families. Owen Sound has one of the lowest average
household incomes in the province at $75,861, which makes even small
cost increases nearly unbearable for many families.
It’s important to realize the significance of Owen Sound’s low
household incomes. Most households have at least two wage earners
which means that the average wage earner is taking home a gross
income of about $38,000 which works out to be about $19 per hour.
This is the average; which means that there are many families with
household incomes of less than $75,861. In Canada, housing is considered “affordable” if it costs less than 30% of a household’s before-tax income. If we take 30% of the household incomes from the 2022 BMA Report and divide 12 to get the gross monthly income for similarly sized urban municipalities, we get the results shown below in Figure 2.
This informs us that in Owen Sound the average family can afford to
spend $1,892 per month on rent or on combined mortgage and property
tax. The problem for renters is that the average two-bedroom
apartment in Owen Sound costs $1,990.
source:
All Classifieds This
means that Owen Sound families with the average household income or
below, are not living in affordable housing.
Impact of Property Taxes If we assume a 22% income tax rate we can calculate the after tax monthly income for the average household in Owen Sound. According to the 2022 BMA Report property taxes on the average Owen Sound detached bungalow is $4210 or $351 per month. When we calculate the ratio of monthly property taxes to the monthly after tax income using the average household income we get graph should below showing what percent of after tax income that people have to pay in property taxes.
The result is very enlightening. A family living in Owen Sound has
to use 7.22% of their after tax income for housing costs while a
family living just down the street in Georgian Bluff only needs to
spend 2.21% of their after tax income on housing. There is another
way of looking at this, Click here to see a comparison of: What’s
Left After Paying Property Taxes
1) the loss of high paying jobs, and
2) unnecessary expense increases at city hall.
Those of us who were around in the 60s and 70s remember that Owen
Sound once had a thriving industrial base. We can see some of the
remnants of these industries today in the abandoned properties, like
the empty lots where the Black Clawson Kennedy foundry once stood on
the west and Russel-Hipwell’s on the east side. There was also the
Keenan’s Toothpick factory, RCA, Goodyear and Pittsburg glass to
name just a few.
During the time when these jobs were disappearing Owen Sound’s
population was at times stagnant and often shrinking. One would
think that a shrinking population would result in city expenses at
least remaining the same. Yet when we examine city expenses during
this period and beyond we see that expenses were growing at times at
twice the rate of inflation. This link shows expense growth during a
ten year period. Expense Growth. Much of this expense growth was
caused by the city’s propensity to hire more staff in spite of a
stagnate population.
In Part II we will examine a very realizable solution to
address this problem |
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