Introducing Inclusionary Zoning

Last Monday, Queen’s Park decided it is giving cities the power to make builders include affordable housing in new residential projects.

Introduced as “inclusionary zoning,” this new movement will require developers to set aside a percentage of new suites for low- to moderate-income households.

As a part of Ontario’s Affordable Housing strategy, the legislative change is subject to consultation with local councils, the public and affordable housing advocates across the GTA.

The question remains of the specific rules are around the new legislation; what size of developments are subject to the new rules, will the rules be applicable city-wide, what is the percentage of affordable units required, and how is affordability determined and maintained over time?

While this is a new rule unveiled, the idea of inclusionary zoning has been under review by city council for over a decade. Chief Planner Jennifer Keesmaat claims that this planning tool can, and could have, created 12,000 new affordable homes in five years. Looking at the last five years, according to Keesmaat, if the city had required new developments with over 300 units to reserve 10% of their inventory for affordable housing options, 12,000 new affordable units would have been created.

The reality is that less than 4,000 affordable homes have been created in the GTA since 2010, showing an obvious hole in the affordable housing regulations of the past decade.   The new addition to the housing strategy also includes $178 million allocated over three years for new housing subsidies and benefits, supporting the construction of over 1,500 new supportive housing units.

Both the existing housing strategy and the newly introduced inclusionary zoning efforts are aimed at reaching the province’s 10-year goal of ending homelessness by 2025.

Inclusionary zoning, as a concept, has seen success in the US markets in Chicago, San Francisco, Denver, New York and Washington, creating over 150,000 affordable units in over 400 communities in the past 10 years.

As the Ontario Homebuilders’ Association has questioned, will inclusionary zoning increase the price of new homes, pushing the cost difference on new homebuyers?

According to city officials, citing studies surrounding areas where inclusionary zoning is already present, that hasn’t happened. With government subsidies to make units affordable to lower-income residents, Social Planning Toronto, a non-profit social policy research group, estimates almost 1,200 units could be created every year, at no cost to the public.

So, Toronto, what do you think of the concept of inclusionary zoning? Is this a step in the right direction towards achieving the goals set out by the Affordable Housing Strategy?