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Too tiny for comfort?: York Region grapples with housing affordability challenges

'We’re utterly failing when only the very wealthiest can begin to afford homes': Newmarket Mayor John Taylor
May 9, 2022
Kim Zarzour

Could your family live in a 700-square-foot apartment?

York Region mayors and regional councillors are worried there are too many tiny units being built and not enough livable homes -- and they’re trying to figure out what they can do about it.

The current lack of affordable housing and “plethora of micro units,” brought about due to lower development charges, are “frankly depressing,” Newmarket Mayor John Taylor said at a council meeting on May 5. “We’re utterly failing ... when only the very wealthiest can begin to afford something."

Contrary to concerns heard elsewhere in the province, a regional planning report says York Region actually has a healthy housing supply.

Almost 50,000 residential units were draft approved, registered or in minister's zoning orders, representing approximately six years of growth, the report said.

But there’s been a huge divergence between income and house prices over the past four to five years, regional staff said.

Between 2011 and 2021, average resale home prices increased by 139 per cent, whereas average income increased by only 24 per cent.

The region’s official plan requires 25 to 35 per cent of new housing to be affordable. That target is no longer being reached, council heard.

Based on the 2021 annual household income rate, the maximum affordable house price would be $535,809. Only 0.15 per cent of new ownership units met the affordable criteria, the report said.

In February 2021, council declared an affordable housing crisis and formed a Housing Affordability Task Force.

In an attempt to encourage a mix of housing options, the region lowered development charges -- fees levied on new development to help pay for growth-related infrastructure -- on units under 700 square feet.

But that created another problem.

“They’re only affordable for people who can actually fit into them,” Taylor said. “They’re of no value, or little value, to families. They're largely rental and investor units.”

Vaughan Regional Councillor Linda D. Jackson said 75 to 80 per cent of development applications in the last year were for these tiny units. Developers told her it’s because they’re cheaper to build.

“I’ve seen some of them in Vaughan. They’re trying to ram two bedrooms in them,” she said. “I challenge any of you to go into a 700-square-foot condo or smaller to see how you can actually live in that.

“I really think we should incentivize more the opportunities to our developers to build larger units for families.”

Jackson said Vaughan is considering reducing development charges for 1,000-square-foot units.

Markham Mayor Frank Scarpitti doubted that would help.

Changing development fees would have minimal impact with skyrocketing construction costs. Even 500- to 700-square-foot condominiums in Markham no longer fall within the range of affordability, he said.

Whitchurch-Stouffville Mayor Iain Lovatt also expressed doubt.

“Any savings that might be realized by a developer on DCs ... will just go into developers’ pockets.”

Instead, Lovatt said, local levels of government should more aggressively search for ways to promote multi-unit and infill development.

Development charges are just part of the puzzle, Taylor said.

The Official Plan and policies could encourage the building of two-storey townhomes instead of three, Taylor said, or impose a moratorium on the demolition of bungalows, “one of the few affordable single-family homes out there. They’re all being replaced by monster homes that cost twice as much.”

The region could also advocate for the province to change legislation to give local governments more tools to drive affordable housing, he added.

Newmarket Regional Councillor Tom Vegh pointed to Newmarket’s Shining Hills development, where a portion of homes are given “by right” approvals to have basement apartments with electrical boxes, meters and wider driveways.

“That's something that helps new homeowners pay their mortgage because they have revenue coming in, but also provides two already-approved basement apartments.”

Vegh called for a “show and tell” from other municipalities to learn about other creative approaches being taken elsewhere.