Industry Report: Lack of Missing Middle Making real estate Increasingly Unaffordable
Shortage of shovel-ready land is impeding GTA’s ability to build complete communities
The GTA is in danger of becoming the next London, Hong Kong or New York City — highly desirable cities but unaffordable for most people.
Much of the dramatic increase we have seen in the prices of new homes, resale homes and rentals is the result of supply being outstripped by demand. The population of the GTA has grown significantly, but housing supply has not kept up.
An answer to this supply crisis may lie in building our way to affordable housing much like Tokyo has. The Japanese city has made home construction easy; zoning laws grant landowners greater flexibility to do what they want with their property, allowing them to use their land with little pushback. With a growing population of 13 million, builders constructed more than 142,000 homes in 2014, making it possible to purchase a detached single-family home near the city core for $300,000.
Housing options for people living in the GTA have been either large expensive lowrise dwellings or smaller highrise condos. What we’re missing in the GTA are townhouses, triplexes and midrise buildings.
Montreal has embraced the power of this “missing middle.” Developers are building lowrise dwellings, mostly three-storey flats and midrise apartment buildings within the city and in the suburbs, making Canada’s second-largest city more affordable than Greater Vancouver.
The homebuilding and land development industry wants to design and build homes and communities much like Tokyo and Montreal that meet the housing needs of the GTA. That is our business, that is what we do — but it is getting harder as challenges grow in number and scale. Complicated and restrictive government policies, already lengthy yet still worsening approval processes, a shortage of shovel-ready and approved land on which to build, escalating land prices and the growing issue of NIMBYism (not in my backyard) are impeding our ability to build homes and communities.
Excessive red tape and increasing delays in planning approvals are another huge challenge. Across the GTA it is taking longer and longer to get the go-ahead for projects. A typical new lowrise development 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. All new development applications must conform to area zoning bylaws to get approved but unfortunately many municipalities are operating with badly outdated bylaws that don’t align with provincial intensification policies.
It’s time for government to take action to address our housing supply problem. Across the GTA, the planning approval process needs streamlining to remove red tape, pre-designate and prezone land and approve all outstanding environmental assessments that relate to critical infrastructure. As well, zoning bylaws need updating to support intensification policies — policies that need to be supported 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 homebuyers 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. He can be found on Twitter (twitter.com/bildgta), Facebook (facebook.com/bildgta), and BILD’s official online blog (bildblogs.ca).