Thousands of sites for homes sit shovel-ready in Toronto area

Theglobeandmail.com
May 8, 2017
By Jeff Gray

More than 55,000 sites for coveted detached homes, semis and townhouses are approved and close to shovel-ready across the Greater Toronto Area, the Ontario government says, despite complaints from some in the development industry about a land shortage.

The internal provincial government numbers, compiled from municipalities that surround Toronto and requested by The Globe and Mail, add ammunition to the debate over whether Ontario’s decade-old landmark anti-urban-sprawl policies are cutting off the supply of land for new houses, and driving the run-up in the Toronto area’s real estate prices. The release of the numbers comes just weeks before the Ontario Liberal government is to announce changes to its two key anti-sprawl policies, the Greenbelt and the Growth Plan for the Greater Golden Horseshoe.

The Globe and Mail has confirmed that the government will ignore demands from developers to water the plans down, and stick with its stated intention to strengthen them along the lines recommended by a panel headed by former Toronto mayor and federal Progressive Conservative cabinet minister David Crombie.

The development industry and some economists claim that the Growth Plan, which forces municipalities to grow more densely, has caused a shortage of “serviced land” - sites connected to main water and sewer lines - on greenfield sites earmarked for “ground-related” houses.

Ground-related houses include detached, semi-detached or townhomes.

Instead, municipalities have been approving too many high-rise condominiums and apartments, they argue.

But according to the government’s figures, there was enough serviced land on greenfield sites in 2016 to build 56,762 new units of ground-related housing in Hamilton and across Peel, Halton, York and Durham Regions over the next three years, with all of it sitting either fully approved or in the “draft approval” stage.

(The figures exclude Toronto itself, which has little designated greenfield area, as well as any approved sites within areas in the surrounding municipalities designated as already built-up, where the Growth Plan now mandates that 40 per cent of development should go.)

The province’s Ministry of Municipal Affairs says the 56,762 ground-related units it found represent 3.85 years’ worth of supply, well ahead the three-year minimum supply of serviced land that municipalities are mandated to maintain by provincial rules.

Of those ground-related units, 12,268 were registered, approved and ready for building permits that could be issued “immediately,” the province says, but were left unbuilt. For comparison, there were just 17,536 ground-related housing starts in the Greater Toronto Area last year, in the hottest housing market in decades.

Bryan Tuckey, chief executive officer of the Building Industry and Land Development Association, denied that builders were intentionally sitting on land and delaying construction in the interests of reaping larger profits: “This is not in their headspace at all. This market may or may not be sustainable. They’re worried it’s not. So if they could sell houses now at these values, they would be selling them.”

Mr. Tuckey has in the past blamed runaway house prices on the Growth Plan’s intensification policies and a lack of serviced land for ground-related homes. Presented with the province’s numbers, he acknowledged that “servicing may not be the key driver any more,” and said red tape was increasingly causing delays.

But he also said the province’s numbers were based on “out-of-date” or incomplete information that did not square with the experience of his group’s member companies. For example, he said, most of those 12,000 registered units ready for immediate building permits have likely been sold, and so will be built this year.

In an e-mailed statement sent to The Globe, a spokesman for Bill Mauro, Minister of Municipal Affairs, reiterated the government’s plans, announced last month as part of its housing affordability strategy, to set up special teams to try to streamline the approvals process, to ensure that bureaucratic delays are not behind the lack of supply: “Through these and other initiatives, we are working to promote housing supply by ensuring that approved housing units are built as quickly as possible.”

The province also collected numbers for high-density sites. Add draft-approved and registered and unbuilt sites for high-density apartments and condominiums to the ground-related numbers, and there were 70,675 units across the GTA and Hamilton - again excluding Toronto - that could get building permits now or in the next three years.

In Toronto itself, despite industry complaints about the length planning approvals can take, chief planner Jennifer Keesmaat said her department is approving 20 per cent more units a year than the industry can actually build. Right now, there are 132,000 units - mostly high- or mid-rise - in Toronto that are approved but not built, she said.

Last month, Frank Clayton, senior research fellow at the developer-funded Centre for Urban Research and Land Development at Ryerson University in Toronto, issued a report declaring a “fundamental supply shortfall of serviced sites” for ground-related housing.

In an interview, he said the province’s new numbers actually show that there is just enough ground-related housing in the pipeline to sustain the current slow rate of building: “That just satisfies what we are doing right now. We should be building a lot more.”