July 21, 2024

Housing Finance Development

It's Your Housing Finance Development

Q and A with the experts: More Homes Built Faster Act, or Bill 23 | Waterloo News

The Ontario government has introduced sweeping new legislation aimed at building 1.5 million new homes by 2031. Dr. Dawn Parker, a professor in the School of Planning at the University of Waterloo, answers questions about the new legislation, called More Homes Built Faster Act, or Bill 23.

What is Bill 23?

Bill 23, the proposed Provincial More Homes Built Faster act, aims to increase housing supply and, as a consequence, housing affordability through major changes to planning and conservation legislation. 

What is your assessment of Bill 23?

On the positive side, it addresses exclusionary zoning by requiring municipalities to allow more units on residential parcels and increases some incentives for rental and attainable housing supply. Bill 23, however, has many issues, only some of which I will address.

Overall, the Bill may fail to meet its primary objectives in these key areas:

  1. Affordability – Its provisions to require high-rise zoning and increase development profitability will contribute to rising land prices, which makes affordable and/or missing middle housing impossible due to high land costs. In addition, high-rise builds are expensive housing—two-and-a-half times as costly per square foot as low-rise builds. This is just one example of how the Bill will exacerbate unaffordability in housing.
  2. It may not increase housing supply. With a cascade of current construction project cancellations due to rising construction costs and interest rates, increasing financing costs, and decreased demand for units from investors, small increases to development profitability may have minimal impact on housing supply.
  3. The Bill will not create new, livable communities – it creates a race to the bottom for developers, disadvantaging those who prioritize environmental quality and affordability, and for municipalities within Regions, as Regional authorities no longer review and approve development applications. Finally, through limits on public hearings and resident appeals of developments, the Act’s premise is that residents’ desire for green, aesthetically pleasing, and livable cities are barriers to successful cities.

What’s a better approach to making housing more affordable in Ontario?

  1. Affordability – Allow, or even require, municipalities to implement inclusionary zoning across the municipality, creating a level playing field. Provide or facilitate additional non-profit finance for affordable and missing middle housing provisions. Allow municipalities to create height-limited missing housing zones 500-800 metres from transit, to limit land-value uplift and incentivize affordable housing near transit. Empower provincial, regional, and municipal governments to directly build affordable housing—on municipal or regional land, on their own or in partnership with non-profit financiers and builders. 
  2. Supply – Allow at least four units on residential parcels. Incentivize re-purposing of parking lots for housing through subsidizing multi-level parking, reducing or eliminating parking requirements, and regulating on-street parking. Implement non-principal-residence vacant-unit taxes, identified through utility usage, via additional property or land transfer taxes.   
  3. Livability – Ensure that new higher-density builds have sufficient open space and parks to be attractive alternatives to single-family residences. Maintain regional approval authority—potentially consolidating approvals to the regional level to streamline the approvals process.