Archived – More Homes Built Faster

Minister’s message

Ontario is a prosperous and growing province – the best place in the world to call home.

Yet for too many Ontarians, finding the right home is all too challenging. For young people, eager to raise a family in a community of their choosing. For newcomers, ready to put down roots and start a new life. For seniors, looking to downsize, but wanting to stay near their family and loved ones.

This is not just a big-city crisis. The housing supply shortage affects all Ontarians: rural, urban and suburban, north and south, young and old.

The problem is clear. There simply aren’t enough homes being built.

And the solution is equally clear. We need to get more homes built faster.

Our government has committed to getting 1.5 million homes built over the next 10 years, and More Homes, Built Faster: Ontario’s Housing Supply Action Plan 2022–2023 is the next step to getting there.

Our policies will provide the groundwork for growth by:

• reducing the bureaucratic costs and red tape that are delaying construction and pushing home prices even higher
• promoting building up near transit and reforming zoning to create more “gentle density”
• protecting homebuyers and utilizing provincial lands to build more attainable homes

Achieving our goal will not be easy. A housing crisis many decades in the making cannot be fixed overnight.

But More Homes, Built Faster is part of a strong foundation on which 1.5 million homes can be built over the next 10 years – in partnership with municipalities, the private sector, not-for-profits and the federal government.

Our government is following through on our commitment to Ontarians and we are counting on your support as we continue to work to get it done.

Overview

The housing supply shortage is a Canada-wide problem, with many elements – such as high interest rates, construction material shortages and rising inflation – adding to the crisis.

This plan addresses the crisis by reducing government fees and fixing development approval delays that slow housing construction and increase costs. We intend to reform these processes at the provincial and municipal levels to ensure all Ontarians can find a home that meets their needs and budgets.

Building more homes

Too many people are struggling to find an attainable home that meets their family’s needs. It’s a complex problem that will require a range of solutions. One key element is increasing the supply and mix of houses. We need more homes of every type, from three-bedroom condos, to stacked townhouses, to secondary suites.

Gentle density

Gentle density: Increasing the number of units in urban areas with minimal impact on existing neighbourhoods.

One of the ways we propose to increase gentle density is by expanding what’s allowed to be built without further planning approvals. Our plan would permit up to three residential units on most residential lots “as of right” – that is to say, without needing a by-law amendment. For example:

• a main residence
• a basement apartment
• a garden house

This creates a broader mix of rental housing and could help homeowners to pay their mortgage or accommodate extended family.

The new units would also be exempt from development charges and parkland dedication fees, and municipalities wouldn’t be able to set minimum unit sizes or require more than one parking space per unit.

To make it easier to build missing middle housing, we’re also consulting on proposed Building Code changes, such as matching federal code requirements for four- to six-storey wood buildings and removing standpipe systems from four-storey stacked townhouses. This would reduce costs while protecting public safety.

Density near transit hubs

Adding more basement apartments will help, but we need to enable more density to truly address the housing crisis. The logical place to put more housing is near major transit hubs, so people can easily get to work, school and back home. Once the minister approves the key development policies for major transit hubs, we’re proposing to require municipalities to update their zoning by-laws within one year to help get shovels in the ground faster.

Revitalizing new housing supply

Under the current rules, if a mid-sized rental apartment is demolished, municipalities can limit what’s built on the site. For example, they may specify the size and number of replacement units in the new building. While this may be intended to preserve affordable rents and protect tenants, in reality it can prevent renewal, limit the supply of rental units and lead to deteriorating housing stock. We will launch consultations to figure out how to protect renters while also building more, desperately needed rental housing.

Municipal housing targets

As Ontario’s population has grown, housing construction has not kept pace. Our housing stock has to both catch up and keep up with population growth projections. If this does not happen, prices will continue to rise and it will become even more challenging to find a place to live.

Municipalities already have population and employment forecasts that help them plan for what their communities will need in the coming decades. But this assumes there are enough homes to meet the community’s needs today, which is not the case.

We’re asking 29 of Ontario’s largest and fastest-growing municipalities to pledge to address that gap over the next 10 years. These pledges are in addition to existing, longer-term targets in municipal land use plans and will help kick start development by highlighting the need for municipal infrastructure, like roads and sewers.

Ontario is also taking action to accommodate rapid population growth in York Region. We are leveraging existing wastewater infrastructure to meet anticipated needs while maintaining strong environmental protections. This would also save York and Durham Regions and their rate payers more than $800 million over other solutions examined.

Identifying more land for housing

We’re also looking at making more land available for housing. We continue to expedite housing construction on underused provincial lands, and are proposing to streamline conservation authorities’ processes to sell or lease lands they own, including those suitable for housing. Requiring conservation authorities to identify in their land inventory any authority-owned land that could support housing development is another of our proposals to get housing built sooner.

A complicated system of overlapping policies guide land use in Ontario. We want to make our land use planning policy framework easier to navigate, interpret and implement. We’re seeking input on integrating A Place to Grow: Growth Plan for the Greater Golden Horseshoe and the Provincial Policy Statement into a single, provincewide policy document.

We’re also proposing to revoke the Parkway Belt West Plan and the Central Pickering Development Plan. Combined, these proposals would help municipalities approve housing faster while continuing to protect the environment, prime agricultural areas and public health and safety.

Building more schools

In addition to roads and sewers, communities also need schools, and that’s a problem in some urban neighbourhoods. A new working group will look at innovative approaches, like incorporating schools in high-density communities, and how to get them built quickly so that, as communities grow, kids can go to school close to home.

More affordable housing options

Much attention has been paid to the lack of attainable housing, and how people with good jobs and two incomes can’t find a place to live. But we also need more affordable housing, especially around transit and in other high-density areas. We’re consulting on how to make inclusionary zoning rules more consistent, with a maximum 25-year affordability period, 5% cap on the number of affordable units and a standardized approach to determining an affordable price or rent.

Helping homebuyers

The challenges holding back homebuilding are not the only thing contributing to Ontario’s housing supply crisis. Too many units sit empty and would-be homebuyers and renters are priced out of the market.

To prioritize Ontario families and homebuyers, not foreign speculators looking to turn a profit, the government is increasing the Non-Resident Speculation Tax rate from 20% to 25% to make this tax the highest and most comprehensive in Canada. Increasing the tax rate will strengthen efforts to deter non-resident investors from speculating on the province’s housing market and help make homeownership more attainable for Ontario residents.

Incenting more efficient use of vacant homes

This winter, Ontario will release a policy framework setting out the key elements of local vacant home taxes. A provincial-municipal working group will be established to consult on this framework, and to facilitate sharing information and best practices.

Local vacant homes taxes encourage property owners to rent or sell unoccupied homes, so more families can afford a home.

We’re also launching consultations with stakeholders and experts to explore home financing models – including rent-to-own – that would help both renters and homebuyers realize their dream of homeownership.

Similarly, we’re working on a new program that would adopt a variety of tools to support the construction of housing, creating homes that more Ontarians can afford to buy. We would explore using parcels of surplus provincial land in areas across Ontario and innovative approaches to build housing.

We will work with other levels of government, not for profits, financial institutions, home builders and other experts to identify options and approaches to create more housing that is attainable and open to all.

Protecting consumers

We’ve heard about people purchasing pre-construction homes, only to have their contracts unfairly cancelled months later. We’re strengthening our existing protections for purchasers of new homes, including pre-construction homes and condos, from unethical builders and vendors who contravene the New Home Construction Licensing Act.

This is why we’re proposing to double the maximum administrative monetary penalty amount to $50,000 to address unethical and illegal behaviour and to allow the Home Construction Regulatory Authority to return funds collected directly to affected consumers. By holding builders and vendors of new homes to professional standards and increasing financial penalties, the government is further protecting consumers and their financial investments when they make one of the biggest purchases of their lives – a new home.

In late 2022, we will consult on regulations relating to financial penalties that would apply retroactively to contraventions that occurred on or after April 14. If passed, the amendments would come into force in early 2023.

Streamlining land lease approvals

Land leases, where the house is owned and the land it sits on is rented, are a more attainable housing option for many people, particularly in rural parts of the province. We’re proposing to streamline the land lease approval process to encourage more development and increase the number of land lease community homes.

Reducing construction costs and fees

Many different things contribute to the price of a new home – from land values and interest rates to materials and labour costs. One little-known factor, however, is the variety of charges and fees levied by different government bodies. While a single fee may be small, the total impact can be significant.

We’re proposing to freeze, discount and reduce government charges to spur new home construction and help address Ontario’s housing supply crisis.

Municipalities levy three main charges:

• development charges, which fund infrastructure like water, roads and libraries
• parkland dedication fees, which can be money or land and are used to acquire park space
• community benefits charges, which can be used to fund other services like parking, that aren’t covered by development charges or parkland fees

We’re proposing to exempt affordable housing, non-profit housing and inclusionary zoning units from development charges, parkland dedication fees and community benefit charges. Rental construction would have discounted development charges – with deeper discounts for family-sized units.

Reducing development charges

Today, development charge by-laws must be reviewed every five years. Extending that deadline to 10 years would reduce administrative work for municipalities and could help keep charges low. New development charges would be phased-in over five years.

Reducing parkland requirements and fees

Reducing parkland requirements for higher density residential developments by 50% and capping them at 15% of the value of the land will help reduce costs for new condominiums and apartment buildings. Freezing the fee at the site plan/zoning application stage would make costs easier to predict, but developers would have to get their building permit within two years. This would speed up construction while keeping costs down.

When someone builds “infill development” (more units on a parcel of land with an existing home) the maximum community benefits charge would be based on just the new units, rather than the entire parcel of land. The new units would also be exempt from development charges and parkland dedication fees, and municipalities couldn’t set minimum unit sizes or require more than one parking space per unit.

Municipal fees and charges are collected to build infrastructure, not interest. We’re proposing to require municipalities to use or allocate 60% of their development charge and parkland reserve balances each year, to build the infrastructure and parks communities need.

Other levels of government charge fees as well. We’re proposing to amend the Conservation Authorities Act to enable the Minister of Natural Resources and Forestry to temporarily freeze conservation authority fees for programs and services to current levels, as well as reviewing those levied by provincial ministries, boards, agencies and commissions to see how they affect the cost of housing. This is anticipated to reduce the financial burden on landowners making development related applications and seeking permits from conservation authorities.

Reducing the property tax burdens on apartment buildings

We’ve heard about the high property tax burden on multi-residential apartment buildings and the potential implications for housing affordability in the rental market. The government sets the same education property tax rate for all residential properties, including apartment buildings. However, municipalities typically tax multi-residential apartment buildings at a higher property tax rate than other residential properties, such as houses and condominiums.

We will consult with municipalities on potential approaches to reduce the current property tax burden on multi-residential apartment buildings in Ontario.

On average, municipal tax rates levied on multi-residential apartment buildings are nearly double the property tax rate levied on houses and condominiums.

Tax measures to support affordable housing

Property tax assessments for affordable rental housing are established using the same approach as regular market units. We will explore potential refinements to the assessment methodology so that it better reflects the reduced rents that affordable housing providers receive.

We also will call on the federal government to come to the table and work with us on potential GST/HST incentives, including rebates, exemptions and deferrals, to support new ownership and rental housing development. All levels of government need to work together to get more homes built and address the housing crisis.

Streamlining development approvals

If you want to build a house in Ontario you must follow a series of rules that ensure buildings are safe, have necessary infrastructure like water and electricity, are in an appropriate location and many other important requirements. The challenge is to balance these rules with the time and work it takes to comply, assess and enforce them. One of the ways we do this is through the development approvals process.

Currently, the time to complete development approvals for a four-storey apartment and a 40-storey condominium is virtually the same. That’s why we’re proposing to remove site plan control requirements for projects with up to 10 residential units (other than land lease community developments). It will reduce the number of approvals in the pipeline, speeding things up for all housing proposals, while building permits and building/fire code requirements would continue to protect public safety.

For larger projects, we propose to speed up approvals by focusing site plan reviews on health and safety issues, like flood-plain management, rather than architectural or decorative landscape details.

In Spring 2022, we committed to provide comments on any applications for housing developments within 45 days. We’re meeting this commitment for thousands of routine applications we provide comments on each year. For more complex applications we are providing upfront guidance, encouraging pre-consultation, and triaging to help ensure we meet our commitment.

For example, Ontario’s highway corridor management system is planned to provide a seamless and integrated online platform for approvals and permits along provincial highways. Work is ongoing to allow applicants, including home builders and municipalities, to submit, track and receive all their Ministry of Transportation approvals online, saving time and money.

Speeding up municipal processes

Municipalities must hold a public meeting for every draft plan of subdivision. Making this optional could get shovels in the ground faster, while the public could continue to provide input at the official plan and zoning by-law stages.

In some areas with upper- and lower-tier municipalities (for example, the City of Mississauga which is a part of the Region of Peel), both levels of government have input into development approvals. We’re proposing to focus responsibility for land use policies and approvals in the local, lower-tier municipality. This would give the public more influence over decisions, clarify responsibilities and improve efficiency.

Streamlining aggregate applications

To make sure home builders have the materials they need to build 1.5 million homes in the next 10 years, we’re proposing to remove the two-year freeze on amendments to new official plans, secondary plans and zoning by-laws for aggregate applications. The freeze would continue to apply to non-aggregate applications.

We’re also proposing changes that would allow Ministry of Natural Resources and Forestry staff to make certain decisions on aggregate development applications – for example, by having the decision to issue an aggregate licence made by a director, rather than the minister. This will speed up internal approval processes to support housing development and ensure that aggregate resources are available to build new homes and roads. Requirements in the application process will not change, including the requirement for consultations.

Ontario Land Tribunal

People don’t always agree on how their communities should develop or change. Disputes often arise over land use planning issues, such as where industry should be located, where roads and transit should be built, or how to protect our forests and farmlands.

When people are unable to resolve their differences on community planning issues or have disputes with their municipal council that can’t be settled, the Ontario Land Tribunal (OLT) provides a forum to resolve those disputes.

We want to speed up decision making at the OLT and help increase housing supply by:

• prioritizing cases that create the most housing
• establishing service standards (i.e. timelines for completing specific stages of a case)
• clarifying the OLT’s powers to dismiss appeals due to unreasonable delay or failure to comply with a tribunal order

We are investing in additional resources to help the OLT speed up proceedings including resolving cases faster, hearing priority projects sooner and streamlining processes.

We would also limit third-party appeals (appeals by individuals and groups who are not directly involved in the case, like community groups) for official plan amendments, zoning by-law amendments, minor variances and consents. This would make them consistent with who can appeal plans of subdivision, speed up approvals and help reduce the OLT’s backlog.

Similarly, clarifying the OLT’s powers to order an unsuccessful party to pay the successful party’s costs could encourage parties to reach an agreement without going through the tribunal.

Heritage and the environment

Development approvals aren’t all about construction – they also look at the impact on vulnerable systems like the environment and heritage.

We are seeking feedback on how Ontario manages its natural heritage, including wetlands, while supporting growth and development. We’re considering a program to offset development pressures on wetlands. It would require a net positive impact on wetlands and help reverse the decades-long trend of wetland loss in Ontario. We are also proposing to update the Ontario Wetland Evaluation System to remove duplicate requirements and streamline evaluation processes.

Natural hazards

Conservation Authorities develop and deliver local, watershed-based resource management programs on behalf of the province and municipalities. They also issue permits for development in areas prone to flooding and erosion along rivers and lakes and within wetlands. There are 36 conservation authorities in Ontario that each currently have their own development regulation. Streamlining them into one regulation and updating regulated areas and permit requirements would:

• improve consistency in natural hazard policies
• offer a more focused mandate to help reduce flooding risks
• provide more certainty and clarity for home builders
• ensure people and property are protected from the impacts of natural hazards

Protecting heritage while meeting housing needs

We’re also proposing a series of updates to balance preserving Ontario’s history and heritage with the need to build more homes.

The proposed changes will renew and update Ontario’s heritage policies, some of which haven’t been reviewed in more than a decade. They will strengthen the criteria for heritage designation and provide clearer and more transparent guidelines.

This will promote sustainable development that conserves and commemorates key places with heritage significance. It will also provide municipalities, communities, and project partners the certainty, clarity and flexibility they need to move forward with priority projects, such as housing, and build strong, vibrant and thriving communities across the province.

These changes will provide our municipal partners the tools they need to conserve and commemorate the places that matter most, and the flexibility they need to respond to the changing needs and priorities of their communities.

It will also ensure that project partners and the neighbourhoods that need these projects have the certainty they need to get shovels in the ground.

Conclusion

Ontario’s housing supply crisis is complex and didn’t develop overnight. Tackling the crisis will also take time.

We will need both short-term strategies and long-term commitment from all levels of government, the private sector, and not-for-profits to drive change.

We are proposing a range of solutions to help build housing faster and bring costs down. Building on our work over the last four years, these policies continue to create a solid foundation that will address Ontario’s housing supply crisis over the long term.

Housing will remain a key focus of our government and we will continue to take action: so young people can afford a starter home and students can focus on their studies rather than next month’s rent; so newcomers can find a home in a welcoming community; so seniors can downsize in neighbourhoods they love; and so all Ontarians can find the home that best meets their needs and budget.