land development affordability

Approval, delivery delays impact affordability: BILD

Wednesday, December 5, 2018

The recently released Greater Toronto and Hamilton Area Land Supply Analysis from the Building Industry and Land Development Association (BILD) and Malone Given Parsons Ltd. (MGP) found that the former Government of Ontario’s growth policies from 2006 and 2017 had the unintended consequences of lengthening the land development and approval process in the Greater Toronto and Hamilton Area (GTHA), which has led to negative effects on housing supply and affordability.

“Growth policies implemented by the former provincial government from 2006 and 2017 have reduced the amount of available land for new housing communities, increased land prices and have caused home prices to skyrocket,” said Dave Wilkes, BILD’s president and CEO, in a press release.

Some observations from the report include:

  1. The percentage of available land that has been approved for new housing communities in the GTHA region is at 4.5 per cent and falling.
  2. Some municipalities in the GTHA have yet to adhere to the 2006 Growth Plan requirements, missing the 2009 target by nearly a decade, leading to less housing being built across GTA municipalities, compared to Growth Plan forecasts.
  3. As land supply diminishes and as municipal delays climb, the value of serviced land has climbed by over 300 per cent since 2006.
  4. Existing low density neighbourhoods in the GTHA are resistant to intensification, driving density to urban centres and to new communities near the fringes of the GTHA, which are farther away from transit and infrastructure, putting a greater reliance on cars and leading to traffic congestion.
  5. More gentle density homes, such as stacked townhomes and low-rise apartments, should be built within walking distance of transit in developed areas of the GTHA, in order to maximize investment in infrastructure and transit. However, community resistance to increased density causes building in these areas time-consuming, expensive and subject to intervention at the municipal level.

“Land use in the province of Ontario is highly regulated and the 2006 and 2017 Growth Plan changes have slowed down the approval process to bring new land on stream for new communities,” said Matthew Corey, principal at MGP. “Increasing the supply of new land for housing is subject to a process that can take as long as a decade or more.”

The recommendations include:

  1. Make more vacant land available for new communities.
  2. Cut down on bureaucratic red tape and duplication in the planning and approval process.
  3. Avoid directing density to fringe areas and away from transit and existing infrastructure.
  4. Encourage moderate or gentle intensification across the GTHA by clarifying and amending Growth Plan policies to encourage intensification.
  5. Maximize investments in transit and infrastructure.
  6. Provide greater certainty for future development by labeling the agricultural and rural lands of the Whitebelt as future urban areas in the Growth Plan.

One thought on “Approval, delivery delays impact affordability: BILD

  1. Sounds good, but the only real variable in the development equation is the cost of land. The price of the commodity (housing) remains at what a competitive consumer is willing to pay. As fixed costs go up, the only thing impacted is what the developer can bid on land, therefore the value of develop-able land goes down with increased regulation. It does not affect the end price of the product. Basic economics 100.

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