Realistic housing plans a core issue of this election

In our bid to promote increasing the GTA’s housing supply to help address housing affordability, we have been heartened by the discussions during this year’s municipal election campaign.

In considering the affordability proposals that have come forward, it is vital to consider a few practicalities to determine the feasibility of these campaign promises.

The GTA is expecting 115,000 new residents every year, bringing the region’s population to 9.7 million by 2041. With residential inventories at near historic lows, and the long approval time in bringing new homes to market increasing, housing the growing population will remain a generational and defining issue without high-level, longterm, political commitment to action.

How will the promised housing be paid for? Significant portions of the cost of affordable or below-market rental properties are paid for by development charges on new residential projects, which are then passed on to new home buyers. In the city of Toronto, for example, this mechanism is being used to support the plans for building 5,000 new affordable units by 2020 and 14,000 new units by 2027.

Increasing that target by two and five times — depending on the campaign promise — will either require increasing revenue from property tax, increasing development charges, or both. Yet every cost added to a new housing development erodes affordability and opportunities to purchase for future new home buyers.

How quickly will the promised housing be built? On average it takes 10 years to complete a new highrise project and 11 years to complete a new lowrise project in the GTA. In absence of a significant streamline to the approvals process, and cutting the red tape, it will be well into the next decade before the first of the promised housing comes on stream.

It is anticipated that, in order to accommodate population growth and demand, as many as 10,000 additional housing units per year — over and above the 2017 level of new construction — will be required across the GTA and Simcoe County. But simply concentrating the majority of new residential construction, considering the current level of building activity across the GTA, could have unforeseen impacts. These include further stresses on infrastructure (including transit) to accommodate the extra population, and pressure on construction costs due to increased demand for land, trades and building materials.

And while homeownership is the preferred housing model in Canada, the majority of units promised in current campaigns are proposed as purposebuilt rentals. Though desperately needed, municipal plans should not exclude building homes that people can afford to buy.

As we all review the housing platforms of the various candidates, including affordable housing elements, let’s judge them on the following criteria: a) are they realistic and feasible; b) do they build on existing programs and funding; and c) will they be realized in the time frames required. In the city of Toronto, for example, based on the above criteria, a commitment to achieve 40,000 affordable units seems more practical.

Housing in the GTA is a generational challenge. We must ensure that we develop realistic plans in partnership with all levels of government and the private sector.

David Wilkes is president and CEO of the Building Industry and Land Development Association (BILD) and a contributor for the Star. Follow him on Twitter: @bildgta