Originally published in Financial Post
August 18, 2022
If we want to see anything done by our elected representatives, our best hope is at the municipal level
This fall, municipal elections will be held in the two provinces hardest hit by the housing crisis. Residents will go to the polls to select their mayor and councillors in British Columbia on Oct. 15 and in Ontario on Oct. 24. This year more than ever, one of the key election issues will be housing affordability.
Elected representatives at the local level have many responsibilities, including the oversight of community centres and services, snow and garbage removal, road maintenance, and public safety, but the aspect of their job that has perhaps the longest lasting impact relates to land-use and housing decisions, also known as city-building.
Particularly in fast-growing, high-density wards in Toronto and Vancouver, where development pressure often manifests in pitched battles between demand for new homes and community stakeholders determined to maintain the status quo, elected councillors play the role of arbiter, determining settlements in land-use disputes and voting on sweeping land-use policies that direct growth.
Critical aspects of new real estate developments such as the height, bulk and location of towers, setbacks from property lines, number of units, degree of shadows, type and scale of incorporated community services, parks and open space, and the percentage of affordable housing units provided, are all greatly influenced by the zoning bylaws councillors enact and the contentious negotiations between developers and the existing community into which they insert themselves.
If you have not heard much about municipal elections in this cycle yet, that is because the campaigns really only get under way in a public fashion after Labour Day. Unlike American-style campaigning that begins full blast 20 minutes after the past election results are accepted (or not), Canadian municipal elections are fairly simple engagements that blossom briefly and inexpensively. They tend to take place without the bluster and national media attention of their provincial and federal counterparts. But while they get less attention, these local elections have significant impacts on intimate aspects of our lives.
In Vancouver, Mayor Kennedy Stewart and all 10 current councillors are seeking re-election. Residents who paid attention earlier this year to council’s chaotic process of approving the Broadway Plan — a 30-year plan to integrate new housing, jobs and amenities around the new Broadway Subway — will have an opportunity to use their vote as a commentary on how they think leadership of city-building has been managed.
In Toronto, more of a shakeup is guaranteed. At least five incumbent councillors have announced that they will not seek re-election, including some who have been vocal in their fight against intensification pressure in their wards.
Housing affordability in both Vancouver and Toronto continues to be at elevated levels of crisis. Such factors as interest rates and hard construction costs are outside the sphere of influence of local representatives, but councillors do hold responsibility for many of the other costs that wind up in what we all pay for housing, whether we rent or buy. When they seek to reduce the height of proposed towers, even those right beside existing subway stations, they decrease the supply of new homes available. When they support NIMBY forces fighting every development of scale, they extend timelines dramatically. When they vote to approve well-intentioned but poorly implemented new policies, like Toronto’s Inclusionary Zoning Policy, which requires new residential developments to include affordable housing units, they shift costs of development from a few lucky residents who will get a discounted housing unit to people who pay the resulting increase in market housing costs.
An egregious example of how councillors enflame housing affordability issues happened just this past July when Toronto city council approved the adoption of “growth funding tools” that will raise the development charges paid for new residential units by up to 46 per cent, with the increase to be phased in over two years. This means developers of detached and semi-detached houses who currently pay approximately $94,000 in development charges will have to pay $137,000 for the same project by May 2024. These cost increases are passed on to the purchaser 100 per cent of the time. Current estimates demonstrate that approximately 20 to 26 per cent of the price of each new home is government charges.
Provincial governments have a huge responsibility here, too. We are waiting to see what action the Ontario Ministry of Municipal Affairs and Housing is going to take to address housing affordability concerns. There have been indications that it understands we are in a supply crisis and it plans to enact legislation that will support development. The feds, sadly, are nowhere in this debate; the 2017 National Housing Strategy has done essentially nothing to address housing affordability, which has only eroded greatly since this policy was enacted.
If we want to see anything done by our elected representatives, our best hope right now is at the municipal level. When your local incumbent or candidate knocks on your door this September, I encourage you to ask them how they plan to address housing affordability. If your priority is protecting the value of the home you already own, vote for the candidate who will tell you development is best elsewhere. If you believe a solution to the housing crisis is necessary, listen for progressive city-building solutions that will make our cities better for everyone, and vote accordingly.
Randy Gladman is Senior Vice-President, Development Advisory, at Colliers Strategy & Consulting Group.