Ontario has over a million homes in the pipeline, but developers need to put shovels in the ground: report
Ontario already has more than 1.25 million potential new homes in the development pipeline — it just needs to figure out how to convince builders to put shovels in the ground, say experts who manage planning in cities across Ontario.
That’s the conclusion of the Regional Planning Commissioners of Ontario (RPCO) in a new report released this week on the state of the province’s vacant housing supply.
The number reflects the number of developers for which building permits have been issued but have not yet materialized. Once approved by the municipalities, there is no set timeline by which a developer must build the homes.
The RPCP says its calculations are based on figures from late last year, before the Ford government passed controversial Bill 23, the More Homes Built Faster Act.
The bill aims to help the government build 1.5 million new homes over the next decade — a number that doesn’t include homes already approved for construction. But the planners say if the province could encourage developers to build what has already been approved by municipalities, they would be 85 percent on track to their goal, well ahead of their target.
“I think (the report) begins to tell the story that the housing supply challenge isn’t really a land supply or development permitting issue,” said RPCO Chair Thom Hunt. “Probably the bigger issue is how to force a developer to build? How do you increase the build rate?”
Ford’s Greenbelt ‘land swap’ is not required, according to planners
Premier Doug Ford’s government says Ontario is in the midst of a housing crisis and has introduced a series of bills to address it, including Bill 23. Parks and community centers around new homes.
The province has also proposed what the government is calling a “land swap” to remove parts of the protected green belt to build 50,000 new homes, a move that contradicts an earlier pledge not to touch protected areas.
But the RPCO report shows the government doesn’t need to push that plan, Hunt said.
“The takeaway from this is that for the most part you don’t have to do any extensions to the city limits and you certainly don’t have to go into the Greenbelt area,” he said.
Hunt said the numbers also suggest the government needs to make extra efforts to ensure affordable housing is built below that supply. Partnerships between federal and provincial governments, nonprofit organizations and the private sector are needed to address these urgent needs, he said.
“That’s probably a better way of looking at the housing crisis than looking at it through the lens of, for example, land supply, which at the end of the day might just realize marketable housing,” he said.
Building permits don’t tell the full picture, city councilman says
Toronto City Councilor Brad Bradford is warning people not to look at the numbers in the report and think the province has solved the housing crisis. As it points out, building these homes is complex, he said.
“I think the development pipeline is often armed by people who don’t want more housing to be built,” he said. “We face historic headwinds to create more housing and provide more supplies across Toronto.”
These include rising interest rates making it more expensive for developers to build, inflationary pressures on supplies and ongoing labor shortages, he said.
“We cannot rest on our approval laurels,” said Bradford, chairman of the city’s Planning and Housing Committee and a former urban planner.
“It will require an entire government and a cooperative response with industry.”
Toronto’s chief planner Gregg Lintern said the city approved an average of over 29,700 housing units per year from 2017 to 2021. Only about 16,000 units were built per year during the same period.
That generates an average net income of about 13,700 units and ensures a “continuous supply of approved housing,” he said in a statement.
“While the city typically approves twice as many units as are built, it’s important to … enable a full range of housing offerings to meet diverse needs and work to improve the development review process and approval timelines.” shorten,” he said.
Misunderstandings around the approval process: Expert
Matti Siemiatycki, director of the Infrastructure Institute at the University of Toronto, said the RPCO’s figures show there are sometimes misunderstandings surrounding the permitting process. While approvals for some projects can take some time, it is clear that there are market forces at work that result in approved developments not being built immediately, or sometimes not at all.
“We also know that not every approved unit will be built,” he said. “And I think we need a lot more research into why that’s happening.”
Siemiatycki said developers are sensitive to market forces and also wary of projects being pushed back by the community. They are also sometimes subject to internal changes of direction within their own companies, which can derail approved housing plans, he said.
But the municipalities are under enormous pressure to speed up the planning work. So if they spend the time reviewing a project and it fizzles out, that’s a problem, he said.
“We ultimately need more places for people in more housing units,” he said. “And if the system gets bogged down with projects that aren’t being built, and if there’s a way to thin that out… that’s really important.”
A spokesman for the Minister for Communities, Steve Clark, said the government could not “stand by” if housing costs continued to rise. Even if all the homes in the report are built, the province still needs hundreds of thousands more to meet the goal of 1.5 million homes by 2031, Victoria Podbielski said in a statement.
She said Bill 23 is already speeding up permits and the construction process.
“We will continue to build on this progress with further housing supply action plans to ensure red tape and excessive costs do not prevent hypothetical permits from becoming real homes.”
