TORONTO — A new study commissioned for the Building Industry and Land Development Association (BILD) and the Ontario Home Builders’ Association (OHBA) has identified that the residential development construction industry in Ontario is working at a 33-year high.
The study, by Keleher Planning & Economic Consulting Inc. (KPEC), also found municipalities and regional planners have overstated future housing supply and approved units, and that there are only 331,600 units of actual “shovel ready” units in the province versus the 1.25 million claimed by the Regional Planning Commissioners of Ontario (RPCO). That amounts to 70 per cent of the inventory of units included in municipal estimates not being shovel ready.
The KPEC study found that reported inventories and RPCO estimates of approved lots and units overstates housing supply likely to be available in the short term.
KPEC said the RPCO claim of 1.25 million approved lots is inflated when considering the breakdown of the units within the aggregated number:
- Only 331,600 of these units could actually progress to construction today or in the near future, with full planning approvals, building permits or servicing allocation. Based on the goal of achieving 150,000 units per year, this represents only 2.2 years of supply, stated a release.
- 731,000 of the units are still in the application process, need additional approvals, servicing allocation or are awaiting a decision from municipal council. Representing nearly 60 per cent of the RCPO’s supply estimates, portraying these units as “shovel ready” is inaccurate, the report said, as they are not approved or do not have building permits or servicing allocation.
In many cases these units had been previously refused by municipal councils or appealed to the Ontario Land Tribunal.
- Claiming 150,000 of additional housing would arise from the conversion of existing housing stock to multiplexes, basement units, and accessory dwelling units (ADU). This would represent 15,000 per year and is an 800-per-cent higher forecast than the forecast for ADU used as the basis of the provincial government’s planning.
“With over 160,000 new homes under construction, you would have to go back to the late 1980s and early 1990s to find a similar level of residential construction in the province. Housing completions are also at a 33-year high, underscoring that claims of ‘sitting on supply’ do not match the reality on the ground,” said Justin Sherwood, a senior vice-president at BILD, in a statement.
“Inflating approved lots/unit estimates deflects from addressing the actual issues like land supply, approval timelines and infrastructure (water and sanitary sewer) constraints.”
The provincial government’s housing target requires building 1.5 million homes by 2031.
The study also found a number of municipalities in Ontario, including several in the GTA, already have “use it or lose it”’ (UIOLI) policies and that Ontario’s Planning Act already provides municipalities with several UIOLI powers for development and new housing.
In addition, the study revealed there are significant gaps in municipal data and lack of consistency between municipalities on how they track and report approved lots/units, leading to inaccurate estimations of aggregate municipal development pipelines.
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