Guest Blog: Toronto’s Housing Shortage

• Posted on: April 06, 2010
• Submitted by: votetoronto2010 staff

By Michael Shapcott

Montgomery County, Maryland, a bedroom suburb of Washington, DC, consistently ranks among the ten richest counties in the United States. They’ve been doing it there for more than 35 years. Chicago is a big city at 2.8 million people, but they’ve only really been doing it there for a couple of years. Burlington is a small city in northern Vermont on the edge of Lake Champlain. They’ve been doing it there for two decades.

The “it” is a simple set of rules to ensure that there is a fair mix of affordable homes in every new housing development. The exact mechanism varies from place to place, but hundreds of US cities have already adopted what are known as mandatory inclusionary housing policies.

Good health starts with a good home. Poor housing leads to increased illness and premature death.  Toronto’s Medical Officer of Health has found that neighbourhoods with the worst housing also have the highest incidence rates for a range of illnesses.

But it’s not just personal health. A mix of good homes is vital to creating vibrant communities and is critical for the local economy and local mobility.

The Toronto Board of Trade’s latest report, Scorecard on Prosperity 2010, ranks Toronto as worst among 19 global cities in traffic congestion. One big reason for the log-jam is that people with good jobs – police officers, teachers, office workers – are forced to travel longer and longer to find an affordable place to call home.  

Toronto’s severe shortage of affordable homes isn’t due to the fact that our development sector has forgotten how to build them – it’s just that we don’t build nearly enough of them. Last year in our city, construction started on 11,919 new ownership and rental homes. Yet only 674 of those homes were affordable for low and moderate income households. These income categories make up some 40 per cent of all households – but only 6 per cent of the new housing stock is affordable to them.

It’s no surprise, then, that Toronto’s affordable housing waiting list is growing by leaps and bounds. There were 71,498 households waiting at the end of 2009 – that’s 134,176 women, men and children. The list grew by 7 per cent in 2009 over 2008.

Even worse, the number of households on the waiting list that were housed shrank by 13 per cent to 4,256 in 2009. At that rate, it will take 17 years to provide a home for those currently on the list. By then, roughly 85,000 more households will have been added to the list.

Toronto has a terrible shortage of affordable homes not just for the poorest of the poor, but also for working people who simply cannot afford the growing costs in the private ownership and rental sectors.

What can an American-style inclusionary housing policy offer to Toronto?

Consider Burlington, Vermont, where 200 affordable homes were created out of 1,260 new homes built between 1990 and 2006 – or 16% of all new homes.

If the Montgomery County rules had been in place in Toronto in 2009, we would have had more than 2,100 new affordable homes – three and one-half times the number of affordable homes that were actually built.

Some private developers complain that inclusionary rules will eat into their profits. The most successful US models all include mechanisms to ensure developers continue to get a profit while providing a reasonable supply of affordable new homes.

US developers have found that inclusionary housing rules ensure that they continue to make a profit, and, as a bonus, they get a consistent set of zoning policies which gives them the certainty to quickly and properly deliver their projects.

Bringing US-style inclusionary housing rules to Toronto is an obvious winner, but there are legal and constitutional barriers. An obscure Ontario Municipal Board decision almost two decades ago ruled that a Burlington (Ontario) inclusionary rule was illegal because the city didn’t have explicit provincial authority. Under Canada’s constitution, municipalities are “creatures of the province” and can only do what the provinces allow them to do.

The first step is for the Ontario government to make a simple amendment to the Planning Act to authorize municipalities to create inclusionary plans appropriate for their communities. The province has already taken a step in this direction when it released a policy statement in 2005 that requires municipalities to come up with 10-year housing plans. Municipalities are required to create plans, but they don’t have all the tools that they need.

Toronto has been studying inclusionary housing for years. Almost two years ago, the Wellesley Institute hosted a day-long workshop with more than 100 municipal planners and several leading US experts on inclusionary housing to help move the agenda forward. The fruits of that discussion can be found on the Web at Inclusionary Housing Canada.

During the current municipal election, there will be lots of talk about the lack of affordable homes and related problems like traffic congestion, unsafe and insecure neighbourhoods, and growing costs for social services to help those who are precariously housed.

There should be more talk about a simple, practical solution called inclusionary housing that will build healthy neighbourhoods and a stronger city.

Michael Shapcott is Director of Affordable Housing and Social Innovation at the Wellesley Institute, a research and policy institute in Toronto dedicated to advancing urban health.

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