Time is now to tackle the housing supply crunch

We have a shortage of housing supply in the GTA that is approaching crisis levels and it is time for governments to acknowledge the problem and take action to address this issue.

Not enough new housing is being built to keep up with consumer demand and the needs of this growing region. The lack of supply is having an impact on not just the price of new homes, but also the resale housing market and the rental market.

The population of the GTA has grown significantly in the past decade, but our housing supply has dropped. Today in the GTA there are less than half the overall number of new homes available in builder inventories than there were a decade ago.

In December 2006, there were 30,400 new homes available to purchase, while in the same month of 2016 there were just 13,670.

The drop is most pronounced in the lowrise market where the number of detached homes, semi-detached homes and townhomes plummeted from 17,529 in December 2006 to just 1,878 a decade later.

The homebuilding and land development industry is complying with provincial intensification policy and building and selling far fewer lowrise homes than 10 years ago.

But demand for those types of homes has not dropped with the supply so prices have increased dramatically.

The average price of a new lowrise home in the GTA has more than doubled in 10 years and reached a record $995,116 in December 2016.

For single-family detached homes, the average price reached an unprecedented $1,264,604 in December, up by more than $273,000 in just 12 months and up by an unbelievable $811,394 since December 2006.

It was a record sales year for the GTA new condo market in 2016 with 29,186 units sold. Builder inventories of highrise units fell to their lowest level in 10 years.

In December 2016, the average price for a new condo hit $507,128, setting a record.

There are many barriers that hold back the industry’s ability to build more homes to meet the demand. Lack of land that can be developed and is serviced with critical infrastructure, excessive red tape, outof-date zoning and NIMBYism are the key hindrances limiting our ability to build more housing.

Much of the land designated for development in the GTA is not serviced with water and/or sewers, hydro and waste water — in some cases, the necessary servicing won’t be in place for at least another decade.

Excessive red tape and increasing delays in planning approvals are another huge challenge. A typical new lowrise development in the GTA can take a decade or more and highrise projects can take up to seven years.

The approvals process is further delayed due to zoning bylaws in many GTA municipalities that have not been updated for decades and don’t align with provincial intensification policies. It is time to take action. Across the GTA, governments must streamline the planning approval process and cut back the red tape, predesignate and prezone land and approve all outstanding environmental assessments that relate to critical infrastructure.

As well, they need to update zoning bylaws to support intensification policies and support these policies with public education.

This is not a time for small plans. It’s time to work together and address our housing supply crisis so that today’s new home buyers and future generations have somewhere to live. Bryan Tuckey is president and CEO of the Building Industry and Land Development Association (BILD) and is a land-use planner who has worked for municipal, regional and provincial governments. Find him at twitter.com/ bildgta, facebook.com/bildgta and bildblogs.ca.