Cost Analysis Of Homelessness

As of 2013, homelessness cost the Canadian economy $7.05 billion annually (up from $4.5-6 billion in 2007). This includes provision of emergency shelters and community supports, but also accounts for the increased costs of emergency services (including fire, police and EMS), health care, the criminal justice system etc. 

Significant research has been done that explores the cost of housing someone in jail, hospitals or the shelter system compared to housing them in social or supportive housing – and the difference is quite shocking. In a 2005 study by Pomeroy which looked at costs in four Canadian cities, institutional responses (jails, hospitals, etc.) cost $66,000-$120,000 annually and emergency shelters cost $13,000-$42,000 annually, whereas supportive and transitional housing cost $13,000-$18,000, and affordable housing without supports was a mere $5,000-$8,000

This cost analysis doesn’t look at the social and human costs. Not only is putting someone in housing cheaper, it is also much more humane. The longer someone remains homeless, the greater likelihood that their physical and mental health will deteriorate and there is an increased chance of an early death.

The State of Homelessness 2016 report showed that by addressing the needs of key populations disproportionately affected by experiences of homelessness, there are corresponding cost benefits. For example, the two-year pilot project called The Canadian Model for Housing and Support for Veterans Experiencing Homelessness in 2012, was designed to address the needs of Canadian veterans experiencing homelessness. The program included a Housing First approach and staff or volunteer resources for each participant. The program revealed promising results of an estimated $536,000 per year (in terms of cost savings) due to reductions in 911 calls and emergency-shelter drop-ins.

Additionally, a study involving individuals experiencing homelessness alongside mental health issues (in Vancouver, Winnipeg, Toronto, Montréal and Moncton) found that a significant amount of money is spent on average, per person ($53,144 annually). This study suggests that a heavier focus on preventative measures and programming that addresses the social service, housing and mental health needs would be more cost effective for society at large.  

Cost of Homelessness