Toronto is on a roll
And our home price issues are a direct and predictable result
If only a simple few moves could get housing prices back into the affordable realm to even a small slice of Torontonians, we would all be happy.
But no such luck. Our leaders can wail to great effect, even propose little changes here and there, but the problem looks like it is beyond human means.
I think the biggest cause of the increased cost of housing, rental and ownership, is the extraordinary growth spurt Toronto finds itself in. The economy around here is booming, with unemployment rates lower than they have been for many years. People want to be here in this city.
This kind of growth is what the leaders of other cities can only enviously dream of. As Jane Jacobs noted, city growth is fuelled by exports (it brings more money into the city, allowing new enterprises to expand), and Toronto’s exports are extraordinary. Our cultural products are in demand: Drake, the world’s biggest performance draw; Come From Away, the hit Broadway musical developed at Sheridan College; Margaret Atwood’s The Handmaid’s Tale, lauded on television; the Group of Seven being discovered in other countries.
Our architects and planners are employed around the world — Diamond and Schmitt redesigning Lincoln Center, KPMB at work in Yale and Princeton. All the while new companies open up shop here.
High housing prices are a result of the demand of more people wanting to live in Toronto. You can put your fingers in the dike to try to prevent cost escalation because of growth — that’s what taxing foreign real estate buyers or owners of vacant units is about — but it hardly deals with the problem.
The development industry tried to blame the provincial government’s Growth Plan for the high cost of housing, arguing its regulations that encourage intensification rather than more sprawl interfere with the industry building what it wants where it wants. But then the government released the figures: in the Golden Horseshoe, no less than 56,000 ground-related units were approved in 2016 for development on greenfield sites. Government regulation doesn’t stand in the way of more houses being built.
The government has extended rent controls to all buildings constructed since 1991, but that will not increase supply — it will simply give some protection to tenants who otherwise find they are facing 30 per cent rent increases. The taxing schemes already noted may have some minor effect, but they will not provide more units.
The critical problem is that nobody planned for the growth we are experiencing. The city has not been pushing hard to create a larger number of affordable housing units. Indeed, city council is going the other way: it has provided paltry funding to repair the Toronto Community Housing units it owns, it and expects to tear down 1,000 affordable units in the next year.
If we had planned for this growth, we would have put in place regulations that allowed modest five- and six-storey infill projects along all of our current subway lines and main arterial streets. We could have begun extensive redevelopment of more than 100 failed public housing projects owned by the city. We could have forged strong agreements by which other governments shared with the city the costs of new affordable housing.
But none of that happened, and there’s no sense of movement that way with the current city administration.
All of which means that, in spite of the tinkering that will occur to a variety of government mechanisms, high housing prices are here to stay for the next half dozen years. Then, when the growth spurt comes to its sad end, housing costs will stagnate, but not as much as wages, so we’ll have a different kind of problem. Something like boom and bust for a city that refuses to do its homework.
Late, great planning guru Jane Jacobs in the backyard of her Annex neighbourhood home