Despite the recent correction on the market, housing affordability remains a problem in the GTA. In this week's news highlights issue we decided to look more closely into this problem and see how Toronto is dealing with it. Where do the government, the developers, the real estate agents and the home buyers stand on the issue?
Almost 20 cultural hubs in Toronto could qualify for a new property tax category under a draft plan that will lower the skyrocketing rates many have been struggling to afford. The decision was announced on Tuesday that the buildings which house artists and non-profit organizations will be assigned a special category in terms of taxation. The new regulation should facilitate creation of creative hubs rather than endangering those which already exist.
If accepted, the implementation of the new tax rule would mean that about 17 buildings in the city could qualify for the “creative hubs” tax class: if they are more than 5,000 square feet, have many tenants (of which at least half are non-profits, charities, or incubators) and offer free public programming, among other criteria. The tax reduction won't result in less revenue for the city, as the amount will be covered by taxes paid by other commercial properties.
Condos.ca: Pre-construction condo boom coming this fall
The Toronto condo market is about to be hit by a tidal wave of pre-construction launches. Across the city, from Water’s Edge in Etobicoke to DuEast in Regent Park, it is estimated that nearly 17,000 new units will come to market over the next two months.
The styles of the project vary: buyers will be able to choose from both luxury-living and community-living projects. One of the projects is a DuEast development on the intersection of Dundas and Sumach, which will contribute to the community revitalization in the neighbourhood. Another bold project is a hyper-luxury living condo building at Young and Bloor, which is designed to become the tallest condo tower in Canada.
However, despite 17,000 of new units coming to the market, the impact on housing availability is not expected to be seen in less than 3-7 years from now. And even then, with the rising migration to Toronto, the units might be absorbed naturally. What the new constructions will offer is more choice and variety of options for the buyers.
The Globe and Mail: 1,000 planned rental units convert to condos in wake of Ontario rent-control expansion
More than 1,000 planned purpose-built rental units have instead been converted to condominiums in the Greater Toronto Area since Premier Kathleen Wynne's government expanded rent control in the spring.
Although the decision was popular among the renters who were struggling to keep up with the prices, the economists warned that the new regulations might limit the supply and make finding a place to rent even harder. Under the policy, rent hikes for all private apartments are now capped to a maximum of 2.5 per cent a year. The legislation caused some developers to review their rental projects.
Most of the current rentals supply come from investors who rent out their condos, but such units are not as reliable in terms of supply as purpose-built apartments, because they can be sold at any time. Moreover, the new legislation puts the landlords at risk of having to cover the costs of inflation, making renting out their units even less appealing.
The Toronto Real Estate Board is raising awareness about the problems that the possible vacant home tax might cause. The board says it's worried there is not enough data or evidence to support the idea that a vacancy tax would increase the supply of rental housing.
It urged the City of Toronto to take a measured approach to help to avoid any unintended consequences for the housing market and property owners. The board also raised the issue of private property rights and the administrative challenges.
Similarly to Vancouver, Ontario government implemented a foreign buyers' tax earlier this year followed by a possible introduction of vacant home tax in an attempt to increase housing affordability and cool down the prices.
TorontoStoreys: Toronto urban planning: What is a shadow worth?
Ben Myers, the Senior Vice President of Market Research and Analytics at Fortress Real Developments, writes that current zoning in Toronto makes shadows, privacy and neighbourhood character worth thousands of units.
Toronto is facing a dilemma between the desperate need for housing and shadow/privacy concerns in some neighbourhoods. In this regard, we all remember the recent conflict between Canadian writer Margaret Atwood and the advocates of affordable housing concerning a new development in the Annex.
Many urban planners see the solution of current housing problem in permitting more 8-12-storey buildings as-of-right (via zoning by-laws) on the Avenues and arterial roads, even though it may be damaging to someone: a shadow on their garden, an extra car on the road that slows their drive, a daycare spot taken, a longer lineup at the grocery store. The question remains: what is fair housing and for whom?