There are many ways in which money for affordable housing can be put to use.
Three key methods are:
1. build non-profit housing;
2. provide housing allowances or rent supplements; and
3. provide tax credits for the developers of rental housing.
All three methods have strengths and weaknesses that merit study.
The private housing market, by itself, is ineffective at delivering newly-built housing for low-income tenants in large urban centres.
In Toronto, for instance, a single welfare recipient with no dependents receives a $342/month shelter allowance that is supposed to cover shelter. Yet she would be lucky to find a decent bachelor apartment for double that amount.
Even if she were willing to spend her entire welfare cheque of $548, she would be hard pressed to find a liveable bachelor apartment.