We need to build more housing

During the first couple of weeks of the year, the Canadian Mortgage and Housing Corporation released data on the 2019 housing market in the Toronto Census Metropolitan Area (CMA). Local builders and developers completed just 27,410 new units in 2019, the lowest level for the Toronto CMA since 1998. There were less than 12,700 condominium apartment completions, the lowest figure since 2012.

Analyzing units over time presents a challenge, as the composition of an average unit has changed drastically over the past 15 years. It’s hard to compare things over time when they’re changing. In the early 2000s, the average home getting built in the GTA was a 2,500-sq. ft. single-family home in the suburbs with three or four bedrooms. In 2019, the average home getting built is an 800 sq. ft. condominium apartment with two bedrooms. So we’re building a similar number of homes, but we’re delivering considerably less square footage, and way fewer bedrooms. This is contributing to our housing crisis.

In 2018, the population of the Toronto CMA grew by 125,000 people, with estimates for 2019 calling for another 130,000 people. Basically, a city the size of St Catharine’s has moved to the Toronto CMA in each of the last two years. CMHC’s forecast for population growth in 2020 is for the CMA to increase by just under 140,000 people.

There will always be people that want to reduce immigration as a way to calm house price growth, but I welcome all newcomers. We need to make it easier to build more to accommodate everyone.

Three years ago, the talk was about foreign investors driving up the new home market and new home prices. The year the new non-resident owner’s tax (2017) was implemented was the highest year for new condo price growth since the 1980s, and 2018 was not far behind it. Foreign buyers were not the problem.

Last year it was all about Airbnb taking 5,500 units away from long-term rentals. Later in 2019, an RBC Economics’ report showed that Toronto (GTA) was 9,100 units short of a balanced rental market, and that the area needs 22,000 new rental units per year just to satisfy demand. Eliminating Airbnb will help, but it won’t help much.

Already in 2020, the saviour of the market according to several politicians, is eliminating vacant condo units. Owners shouldn’t keep units purposely vacant. Eliminating vacant units will help, but it won’t help much.

The only way to prevent the housing crisis in our region from getting much worse is to continue to build at a record pace. It doesn’t mean we need 50-storey towers as far as the eye can see. The planning process and the fees associated with small scale developments have been a killer for small players trying to add gentle density and a couple more apartments to existing neighbourhoods.

If you get a flyer in the mail for a new development in your neighbourhood, get the night off from Netflix and go to the public meeting, lend your support for the project and for more housing supply.

Chances are, the latest “solution” to the housing crisis that someone is touting, either a speculation tax, or offshore investor tax. Your $3 million dollar home surcharge is not going to solve our housing crisis, in fact, not much will. The best solution for ensuring that it doesn’t get a lot worse is more housing supply.