The Toronto housing market continues to grapple with a significant imbalance between demand and housing starts, as highlighted by a recent report from the Building and Land Development Association (BILD). According to the report, the Greater Toronto Area has observed a drastic decline in housing start applications, dropping from 2,428 in 2021 to just 1,225 in 2024. These findings spotlight a growing crisis in housing affordability and availability in the region.
Among the key factors contributing to this trend, the report identified several critical issues such as:
- Worsening housing affordability since 2010.
- New builds failing to match population growth levels.
- Significant reductions in municipal planning board applications.
- Despite some improvements, building permit timelines remain notably high.
- Substantial delay costs for developers and investors.
- Increases in municipal development fees by $42,000 per unit for low-rise developments and $32,000 for high-rise units.
Among the critical barriers identified were high regulatory and tax burdens, in addition to the fees associated with excessive delays. In an interview with CBC, Justin Sherwood, BILD’s senior vice president of communications, indicated that “fees, taxes and charges account for approximately 25 percent” of the cost of building a home. The report estimates that each month of permit approval delay can cost developers between $2,673 to $5,576 per unit, potentially adding $43,000 to $90,000 in additional costs before project completion (CBC interview).
Despite these hurdles, the Ontario government has made efforts to streamline the permit granting process. Legislative measures such as Bill 23 and Bill 185 have introduced exemptions for certain units from municipal zoning by-laws and other building requirements, like mandatory parking. These bills also simplify the appeal process for rejected permits.
Housing affordability touches on fundamental human rights, as enshrined in Article 11 of the International Covenant on Economic, Social, and Cultural Rights, to which Canada is a signatory. Article 11 mandates that state parties ensure housing costs do not compromise other basic needs and that homes are safe and suitable for habitation.
Currently, Canada faces some of the most unaffordable housing markets in the world. The price-to-income ratio is the second worst globally, exacerbated by a recent surge in population growth—the fastest in decades according to recent figures (Statistics Canada)—and significant regulatory and labor barriers contributing to construction industry shortages (CBC report).
For more detailed information, the full report is available on the BILD website (BILD report).