Tag Archives: peel region
A suggestion for affordable housing would be a tax on the development of condo and apartment projects, say developers.
Vanessa Lu – Toronto Star
Any plan that forces a set percentage of affordable housing units in new condo or apartment projects would be essentially a tax, developers say.
“It would be a false economy,” said Stephen Dupuis, who heads the Building Industry and Land Development Association, which represents property developers. “If a unit has to be provided at less than market cost, where does the money come? It’s got to come from the balance of the units.”
The Star’s Your City, My City blog is exploring ways to improve the city, and one reader has proposed mandating “inclusionary zoning,” whereby 5 per cent of units in any new condo or apartment building exceeding 100 units would be allocated toward rent-geared-to-income housing.
Michael Collins-Williams, director of policy for the Ontario Home Builders’ Association, said such a move would turn it into a private-sector obligation to provide affordable housing. “It essentially does end up being a tax on development,” he said. “It’s an odd policy in which you do create a few affordable units, but then you make the rest of the units less affordable.”
NDP MPP Cheri DiNovo (Parkdale-High Park) plans to reintroduce a private member’s bill in May on inclusionary zoning that died when Premier Dalton McGuinty prorogued the Legislature. Her bill would change the provincial Planning Act to permit municipalities to require developers to set aside a certain percentage of new housing units for affordable housing.
“We have to step in and come up with some novel ideas,” said DiNovo. “We have to look at the greater good.” She argued such a policy would not cost any tax dollars, and that developers would be able to sell larger units, aimed at families, that are typically harder to sell.
DiNovo added it would be no different than the funding developers currently give to communities, called Section 37 money, for common-good projects such as playgrounds or parks. The amounts contributed by developers are generally dependent on the negotiating skills of individual councillors.
Collins-Williams said developers fear this would be another tool for municipalities to gain benefits from developers, on top of Section 37 funds.
He argued that inclusionary zoning would raise the average cost of new homes. “It’s asking new home buyers, or renters, to bear the cost of the social subsidy,” he said. “It’s inequitable because it’s a narrow segment of society that bears the cost of the social initiative.”
Developers favour a mix of solutions to improve the supply of affordable housing, including rent supplements, whereby individuals would use government money to help pay rent in private buildings.
Another way to expand the supply of affordable units is to permit basement apartments or second suites in houses. Some municipalities ban second suites, including Peel Region, where the waiting list for affordable housing for families is about 20 years.
Builder Frank Giannone says he believes it’s good policy to mix varying incomes in a building, but “it’s wrong to foist it on people who are going to buy their first unit.” He said such a move would amount to another development charge.