Governments need to better understand housing

You have to wonder, sometimes, just how well governments understand housing. Housing policy, supply, fees and development charges…

Sure, there have increasingly been actions taken at the federal, provincial and even municipal levels to address the challenges the market faces, such as the bold mortgage reforms announced by Ottawa on Sept. 16.

Urgency of action

Clearly, all levels of government recognize they need to do more to address the supply and affordability issues facing the market – and, importantly, homebuyers.

But we’re not sure they fully appreciate the urgency of such action. A chief case in point is the fees and charges that municipalities add to the cost of a new home, which are significant and continue to rise substantially.

So, yet again, the group representing the homebuilding industry in the GTA, Building Industry and Land Development Association (BILD), is sounding the alarm bell. As our story on page 12 discusses, BILD’s third Municipal Benchmarking Study since 2020 underlines that, on average, municipal approvals for new housing in the GTA take 20 months.

As a prospective new-home buyer, especially a first-timer, maybe politics and approval machinations aren’t your primary concern. But perhaps they should be – because these delays cost you dearly. For each month a project approval is delayed, $2,673 to $5,576 is added to the cost per unit. Based on average approval timeframes, this adds between $43,000 and $90,000 to the cost of a new home.

Important voices

This report is not just BILD lobbying for lobbying’s sake. The Residential Construction Council of Ontario (RESCON), for example, recently met with Ontario Municipal Affairs and Housing Minister Paul Calandra to stress the severity of the challenges facing the homebuilding sector.

“We have a devastating housing affordability and supply crisis, yet are still in the dark ages across many municipalities when it comes to residential development approvals,” says RESCON President Richard Lyall. “We can and must do better.”

Instead, meanwhile, we have a provincial government whose most pressing issue has become dreaming of a tunnel under Hwy. 401, despite experts saying the idea is fiscally and practically prohibitive. Or railing against bike lanes, restricting how municipalities plan their cycling infrastructure.

We need these homebuilders to deliver on the housing needs in Ontario, and we need BILD, RESCON and other important industry voices to hold the province’s feet to the fire.

What will it take? More prospective homebuyers learning about how housing policy affects supply, pricing and, ultimately, their homebuying dreams.