RESCON: Stepping up to the plate

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New housing initiatives just scratch the surface, politicians need to do more

With Premier Doug Ford firmly in the driver’s seat in Ontario, and various candidates jockeying to take the podium federally, our political leaders have a golden opportunity to press the reset button on how they plan to breathe life into the province’s ailing homebuilding industry.

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They could start by take a wrecking ball to the existing planning approvals process which often moves at a glacial pace, slows construction and leads to a significant hike in the cost of new housing.

In many Ontario municipalities, the period for development approval processes extends into years, which adds significant financing costs to a project that are ultimately borne by consumers.

Altus Group probed the costs and found that in the GTA they varied from a low of $2,672 to a high of $5,576 per month. If you apply the typical length of delay, it can add up to $90,000 per unit.

Add in the cost of production, taxes fees and levies, and land prices, and developers and builders can no longer build new homes that average working Canadian families can afford to buy. To make housing more affordable, it is therefore critical to speed-up construction timelines.

To be clear, there are some mechanisms in place to accelerate the process. Planning approvals processes have timelines established by the province. However, they are not enforced at the municipal level. The Ontario Land Tribunal is able to adjudicate matters related to land use planning if a municipality fails to make a timely decision, but it is often a lengthy process.

Municipalities should be required to publicly report and post quarterly development approval metrics so the Ministry of Municipal Affairs and Housing can monitor whether a municipality is meeting legislated timeframes.

If not, the municipality should be required to undergo a mandatory regulatory overview to re-evaluate and bring the municipality into compliance.

We presently have too many municipal rules that slow down the approvals process and add to the cost of building homes. Take Toronto’s angular plane requirements. The aim is to create a consistent look and feel from the street level so that transitions from low- to mid- to high-rise buildings are similar. But they result in lost square footage and require specialized layouts.

We need rules that encourage building instead of regulations that restrict projects from being built.

In the Ontario PC election platform, Premier Ford and the party laid out plans for the incoming administration. Much of the blueprint dovetails with reforms that we at RESCON have been promoting.

Particularly encouraging is the pledge to reduce unnecessary red tape and bring about systemic reforms to speed up the cumbersome permitting and approvals processes. Timelines in the City of Toronto, for example, are getting worse, not better. Projects are supposed to be cleared in 90 days, but approvals processes are taking at least 600 days to advance.

The promise to develop a province-wide tool to accelerate land-use planning and building permit approvals and ensure all municipal standards comply with the Ontario Building Code, are also steps forward, as is the commitment to ensure that development charges are calculated in a more standardized and predictable way as they make up a substantial portion of the tax burden on new housing. Taxes, fees and levies now account for 36 per cent of the cost of a new home.

There has been some progress.

The Provincial Planning Statement introduced in Ontario last fall is cutting red tape and will save municipal staff time that can be better spent on other files, while the building code has been amended to support standardized housing designs – which will make approvals easier to obtain.

In Toronto, city council has also adopted as-of-right zoning which will allow up to four housing units to be built on a single lot in all low-rise residential neighbourhoods.

Earlier, council also approved an official plan amendment to allow small-scale apartment buildings and townhouses up to six storeys and 60 units on major streets and in designated neighbourhoods.

But these initiatives are just scratching the surface. Political leaders must do more as the outlook for housing is grim.

Only 347 new homes and condos were sold in the Greater Toronto Area in January, down 40 per cent from a year earlier and 77 per cent below the 10-year average.

At this crucial moment, our political leaders – provincial and federal – must step up to the plate and remove the barriers to building new homes. The challenge is big, but they must deliver.

Richard Lyall is president of the Residential Construction Council of Ontario (RESCON). He has represented the building industry in Ontario since 1991. Contact him at media@rescon.com.