The Lack of Affordable Housing In Toronto Results in Sky-High Households Debts, The Solution? The Mi
The landscape of Toronto housing is in a revolutionary state. As rental vacancies plummet to an all-time low, less then .7% of rental supply in some Central Toronto, and the cost of homeownership increases at a much faster rate than household incomes we find ourselves at a precipice. Either we address the missing middle, and more affordable housing options are made available, or we jeopardize the cultural variegation and vibrancy Toronto is known and loved for as the more vulnerable and marginalized are forced to move farther and farther outside the city core.
The term, ‘missing middle’ describes the lack of available, and more importantly affordable housing options for middle-income households, and includes the rental sector and ownership. Unfortunately, as we take the temperature of the current housing market, more and more fall under the category of the missing middle as current housing is beyond reach households across varying incomes. The housing I’m referring to includes structures such as row houses, apartments under five storeys, apartments in duplexes, townhouses, triplexes, fourplexes, and other innovative forms of development such as garden and courtyard apartments, live-work units above commercial business, and of course, laneway housing. It’s crucial we find creative ways to compensate for the abundant low-density housing such as single detached homes and high-density housing which includes tall high-rise condominiums and focus on the missing middle. It’s becoming increasingly difficult for larger families and new families to find affordable housing within the city where the majority of jobs are. What we are seeing is a drastic increase in household debt and first-time home buyers within the city are being priced out of the ownership market altogether. Statistics Canada reported, households debt in Canada increased to 176.01 percent of gross income in 2018 from 171.31 percent in 2018. Household debt to income in Canada averaged 127.74 percent from 1990 until 2018, reaching an all time high of 176.01 percent in the third quarter of 2018 and a record low of 85.94 percent in the first quarter of 1990.
Jon Love, the Founder and CEO of KingSett Capital, Canada’s leading private equity real estate investment business believes that secondary suits is long overdue in Toronto. As we celebrate Ontario mandating secondary suites, its apparent we are making strides in the right direction and it is encouraging that the province is gaining some traction. Secondary suites promise to alleviate some of the housing pressure and low rental vacancies that we currently face. The Government of Ontario’s Legislative Framework, Section 16(3) of the Planning Act requires municipal official plans to authorize second units:
- in detached, semi-detached and row houses if an ancillary building or structure does not contain a second unit; and
- in a building or structure ancillary to these housing types provided that the primary dwelling does not contain a second unit.
Section 35.1 requires that each local municipality ensure that it’s zoning by-law gives effect to the policies described in Section 16.3.
There are many supporters and contributors to this motion to fill the apparent gap in Toronto’s current housing market. Josh Klein recently had the pleasure of meeting with Danielle Grossenbacher while in NYC. She has an impressive resume, spanning the United Nations Committee on Human Settlements to the Working Group on Housing of the World Economic Forum. In addition to her being an integral member of the above, she is also a chair on “The City We Need is Affordable,” a World Urban Campaign of the International Real Estate Federation (FIABCI) and recently represented the FIABCI at the United Nations.
Being a member of the Toronto Real Estate Board Member (TREB) and proud supporter of Toronto Laneway Homes, Josh along with Danielle spoke about current affordable housing issues in New York City. From there Josh travelled to France to participate in the Affordable Metropolis Series led by the founding principle of FIABCI, Nicolas Buchoud. Josh returned to Toronto with crucial insights from other major metropolises experiences and with potential solutions, such as secondary suites to challenges that are currently looming over our city. Armed with enthusiasm for change, it was a pleasure to enlightening and share information with team members at TREB and Evergreen.
Fellow missing middle supporter Dr. Frank Clayton has extensive experience as a real estate economist. He is a professor and one of the founders of the Center for Urban Research and Land Development (CUR) at Ryerson University. This program is an encouraging leap that is sure to enlighten a new era of young professionals in the land development and urban research field. Progress in addressing the missing middle is certain despite challenges with the zoning and Toronto’s Act to preserve ‘Character’ in specific low-density neighbourhoods.
The sad and ugly truth is that Toronto is behind the times. Provincially and Internationally speaking, secondary suites have not only been identified as a compelling opportunity but has also been successfully integrated. The common goal is to work together to build a stronger and healthier housing system and enrich this vibrant city we call home. We must begin generating conversations around a system that will meet not only the current needs of Toronto residents but the future needs of Toronto residents.