CMB MAGAZINE cmba-achc.ca summer 2016 | 9
editorialsummary
passed on to homeowners.
Last year, in the Greater
Toronto Area's King Township,
the cost of permits and other
compliance requirements added
$57,500 to the cost of an average
single home, while similar costs
in the City of Toronto added
$44,092 to the cost of each
housing unit.
3
In the City of
Vancouver, the Fraser Institute
found that it takes an average of 15 months to
obtain development approval, while permitting
and other costs added $37,000 to the cost of
each unit.
4
In addition, it's not just out-of-pocket fees
that add to housing costs; debt servicing and
carrying costs can mount with approval delays,
which, in many cases, can run for months or
even years. Even a small red-tape delay of six
months can add carrying costs of over $20,000
to the initial price of a million-dollar home.
Municipal zoning rules also create afford-
ability problems. American housing economist
Edward Glaeser suggests that
overzealous zoning restric-
tions by municipal authorities
and land-use planners are a
clear contributor to skyrock-
eting house prices in some
cities, as zoning changes to
accommodate appropriate
housing are too challenging to
obtain. Houston, Texas, is one
of the fastest-growing cities in
North America, and can serve as a model for
Vancouver and Toronto bureaucrats to follow
on the issue of zoning. Between 2010 and
2014, Houston issued more building permits
than any other American municipality. It was
able to accommodate housing demand with
the use of loose land-use policies and the lack
of restrictive zoning, which helped to keep
housing affordable. By comparison, Vancouver
has poorly thought-out zoning rules, with over
two thirds of areas ripe for housing develop-
ment needing to be rezoned, which either adds
to the cost (due to delay) or prevents housing
from being built at all.
It goes without saying that we do need
municipal land-use planning and approval
processes, and those processes cost money to
implement and manage. However, before politi-
cians try to solve our problems with yet another
tax for which there is no empirical evidence to
support, perhaps they ought to look in their
own backyard. e message is especially poi-
gnant for Vancouver mayor Gregor Robertson,
who is proceeding with his plan to introduce a
new empty-home tax, despite not having taken
steps to address housing costs that he is directly
responsible for imposing on the public. If mu-
nicipal governments are unwilling or unable to
cut red tape and delays in the housing-approval
process, perhaps it's time for the provincial and
federal governments to step in.
1
Bob Rennie, UDI speech 2016
2
thestar.com/yourtoronto/education/2014/09/11/international_
students_or_cash_cows.html
3
fraserinstitute.org/studies/new-homes-and-red-tape-residential-
land-use-regulation-in-ontarios-greater-golden-horseshoe
4
fraserinstitute.org/research/new-homes-and-red-tape-residential-
land-use-regulation-bc-lower-mainland
