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On December 6, 2016, the Ontario legislature passed the Promoting Affordable Housing Act, 2016, expanding the powers of Ontario municipalities to implement “inclusionary zoning,” a requirement for developers to build affordable units when constructing new market‑rate housing. The Act changes the provincial Planning Act, RSO 1990, c.P.13, by obliging some municipalities, while making it optional for others, to adopt inclusionary zoning policies. A discussion on the adoption of the Act and debates surrounding its inclusionary zoning provisions can be found on our firm’s blog.
These legislative changes come years after rising housing prices, lagging income levels and dwindling federal and provincial funding have created an increasing need for new affordable housing in Ontario. Significantly, according to the 2017 Demographia International Housing Affordability Survey, over the past 13 years Toronto’s house prices have nearly doubled compared to household incomes, thus making market-rate housing unaffordable for an increasingly larger portion of the population. The same study also notes that nearby areas such as Hamilton and Oshawa are becoming unaffordable for middle‑income residents.
What inclusionary zoning will look like on the ground remains unanswered. By extension, it is difficult to predict whether the changes will have a significant impact on the need for affordable housing in Ontario. For example, it is unclear what an “affordable unit” means under the new changes and how affordable units will have to be priced. However, the province is slated to release regulations in early 2017 that will hopefully give some meat to its approach and allow municipalities to develop their policies and bylaws. Read the rest of this post