Housing – A Wicked Problem

Duncan Maclennan is an economist who has studied housing in the United Kingdom, Australia and Canada. He says that housing is a ‘wicked’ problem¹. It’s wicked because it’s hard to sort out what’s important and what’s not.

In Canada, housing certainly presents as a wicked problem:

• • The number of people who are homeless is growing.
  • People with mortgages are struggling with rising interest rates.
  • People are having more and more difficulty buying their first home.
  • Rents are rising far faster than tenant incomes.
  • People with disabilities and Indigenous people are more likely to be in groups that experience housing stress (eg. homelessness, high housing costs, poor housing conditions).

How do decision makers and their advisors decide what’s most important? Some might argue that people who are homeless should be the priority as they have no housing. Others might argue that attention should focus on programs to support homeowners, who make up the majority of the population. If you look at public funding programs, it seems as if we’re trying to do something for everyone.

Maclennan and co-author Jinqiao Long argue that we need to be thinking about housing in Canada as a system. They say that if we take this view, we’ll think differently about what’s important. For example:

• • We’re accustomed to think about segments of the housing market, such as social housing or rental housing. Maclennan and Long say that thinking about housing as a system would bring other factors like monetary policy (which are currently raising interest rates) and tax policy (which contribute to rising housing costs) on to the table. In doing so, it becomes clear that housing reaches into the scope of all levels of government.
  • Maclennan and Long think that more attention needs to be paid to how the housing system buoys up (or weighs down) Canada’s economy. A sizeable amount of Canadian investment is sunk in mortgages. This limits the amount of investment that can be directed to developing renewable energy, or retrofit technologies. There are tradeoffs from these choices for Canada’s economy and growth.
  • Without systems thinking, the default responses are silo solutions². Canada has made pledges to reduce carbon emissions. There are targets to reduce emissions from transportation and from housing. Maclennan and Long point out that the transportation sector and the housing sector aren’t separate. The transportation and housing sectors are joined together when people travel from their homes to work or shop, or when building materials get transported to a construction site. Systems thinking highlights the relationship between the sectors that could trigger ideas about ways to change how we work or shop or build housing.

To read more about why thinking of housing as a system goes some way to helping sort out the wickedness of Canada’s housing problem, see Maclennan and Long’s work, which is posted at CHEC/CCRL: Housing Outcomes and Economies, the Environment and Governance

Canada is not the only country with a wicked housing problem. Maclennan and Long were part of a team that studied housing in Australia. Articles about that study were published in 2021 and are posted at the Analysis and Policy Observatory: Australian Experts’ Views Of Housing In The Economy: Abstract Dreamings Or Real Directions? as well as Housing: Taming The Elephant In The Economy and Relationships Between Metropolitan, Satellite And Regional City Size, Spatial Context And Economic Productivity

And for systems thinking that takes the right to adequate housing into account, try:
An Action Plan To Achieve The Right To Adequate Housing

1. For more on the definition of a wicked problem, here is an article in The Conversation: Wicked Problems And How To Solve Them
2. Silos are grain storage container that keep grain dry and ready for processing. As stand alone items, silos work fine. That’s the point of the analogy. Within the context of farm operations, there are additional costs that exist outside the silo. Some examples include the investment required to build. As well, there is the time required to fill and empty it. Silo thinking focusses exclusively on the silo.