Toronto is in desperate need of affordable housing units and the city is well short of meeting it, Mayor-elect John Tory says.

While the issue dominated a good part of the recent municipal election, the fact remains, Tory told Toronto Storeys his promise of 3,400 new affordable housing units annually for 12 years is a long mountain to climb.

“Even this year, we’re having a better year and it’s (only) at 1,800 and … the need is greater than that,” he said.

Tory is sitting in his City Hall office after making housing the focus of his first news conference since his landslide win. He offered a three-point plan, which among other things, he hopes will free up more land and speed up the approval process.

READ: Ontario Election 2018: Here Are Party Leaders’ Plans For Affordable Housing

Tory called for:

  • City staff bringing forward 10 sites of surplus city land for affordable housing.
  • Chief Transformation Office delivering a report within 30 days on how to streamline the planning process to speed up the construction of affordable housing.
  • Having the provincial and federal governments come forward with surplus land in Toronto that they are willing to commit to the supply of affordable housing.

As he begins his second term, he said, one of his biggest concerns is the supply of affordable housing, which he said was “magnified” by the number of people who raised the issue with him during the election campaign.

READ: EXCLUSIVE: Mayor John Tory Plans To Make Toronto More Affordable

“I am heartened at the same time by the fact that I had a number of people in my office in the last six months saying that the interest on the part of the (housing) industry, and the pension funds people, and people building purpose-built rental, is very high because they see it as a source of solid return.”

“I think what we now have to do is match up that interest on the part of developer and financiers with a speeded-up approval process, and then with us adding to the mix some incentives like putting up public land or deferred development charges, or some of the things we can do with taxation, to make a significant number of these apartments affordable,” he said.

Tory and many others talk about affordable housing but what is considered affordable?

At the moment Toronto defines “affordable” units as those at or below average market rent.

“Right now, it is a number set by CMHC (Canada Mortgage and Housing Corp.) … but the problem with that is the market rent has risen, incomes really haven’t,” he said, adding the federal formula may well be outdated.

READ: EXCLUSIVE: Prime Minister Justin Trudeau Talks Toronto Real Estate

Earlier this year, the Association of Community Organizations for Reform Now (ACORN) released a report urging the city to reconsider the definition of affordable.

According to that report, since 2011, the average market rent of a one-bedroom apartment has risen by almost one third. The report noted that in 2018, the average market rent for a one-bedroom was $1,202 a month and $1,426 for two-bedroom unit.

The Toronto Starreported in July that in order to afford average market rent, a household would need to earn more than $52,000 before tax to keep its housing cost to 30 per cent of income – a well established rule of thumb.

A survey commissioned by the Building Industry and Land Development Association (BILD) during the election campaign and reported on by Toronto Storeys, found that 67 per cent of respondents felt the GTA is ill-equipped to provide the needed housing of all kinds for an estimated 115,000 new residents moving to the region each year.

READ: Majority Of Renters ‘Seriously’ Consider Leaving GTA: Housing Affordability Worsening [POLL]

Where 40, 000 homes over 12 years came from:

Tory said he went to city officials in the early part of the year to enquire as to what was a realistic goal for affordable housing “and they came back with a figure of 30,000 over 10 years. I said ‘I’m just not satisfied’ … and sent them away and they came back a few weeks later and they said 40,000 over 12,”

As more and more people look to make Toronto their homes, rents have been steadily climbing and the number of affordable units have not kept pace.

In 2009 a goal of 1,000 units was established and even then, it wasn’t even reached until 2015. Now it has jumped to roughly 3,400 and the city is scrambling to catch up.

Tory said if it could be proven to him that an even higher number could be feasible, “I would be the most interested guy in town to hear about that and frankly to adopt it if it is practical.”

The mayor has talked about an affordable housing secretariat and even a standing committee on housing, but the latter has been abandoned after the council was reduced from 47 members to 25 by edict from the Ford government.

READ: Doug Ford To Slash Toronto Council Seats, John Tory Responds “This Is Not Right”

“I will tell you that we will have some initiatives to announce very soon to cause a restructuring to take place such (so) that there is a person … who will drive to meet these targets,” he said. “I can tell you that housing will be a high priority from my standpoint.”

On the matter of property tax:

Tory said in order to get people into their own homes he would also consider a rent-to-own proposition put forward by his chief rival, Jennifer Keesmaat, but he quickly noted he would not entertain the tax on luxury homes that Keesmaat proposed in order to pay for her idea.

READ: Jennifer Keesmaat’s Plan: Affordable Housing, Possible Property Tax Hike [EXCLUSIVE]

On a related matter, Tory ruled out lowering the municipal land transfer tax, which the Ontario Real Estate Association has repeatedly called for, saying it contributes in large part to the high cost of housing in Toronto.

“I wish I could,” Tory said, but added it accounts for about $800 million “and that pays for a lot of transit and a lot of other things.” He said the stark reality is that if the land transfer tax was eliminated property taxes would have to go up about 20 percentage points to make up the difference.

Asked if he thinks the new council will share his concerns about the flagging number of affordable units, Tory said:

“I don’t think there is a single person out of the 25 – 26 including me – that could have possibly got elected in any part of this city …  without having heard about the challenge of affordable housing in this city.”

Real Estate News