Navigating the Housing Crisis: A Call for Collaborative Solutions

As any good rowing crew knows, teams must pull together to cross the finish line successfully. This principle applies equally to the housing supply and affordability crisis we face today. Tackling this problem requires a united front from governments at all levels and the construction industry.

Understanding the Current Housing Landscape

The current housing market in cities like Toronto is in disarray. The tax burden on new housing is alarmingly high, leading to prescriptive definitions of affordability that most ordinary working people cannot meet. Many individuals are now fleeing urban environments because homes are slipping out of their financial grasp. Factors such as taxes, fees, and development charges (DCs) are substantial contributors to this troubling exodus.

The Reality of Development Charges

Development charges are one-time fees that municipalities impose on developers to help fund essential infrastructure and services, including roads, water systems, and public transit. However, these funds are increasingly being diverted for other projects, such as daycares and schools, raising concerns about their proper allocation.

Almost four years have passed since the Ontario Housing Supply Task Force recommended actions to address the incredibly high development charges, yet the issue remains unresolved.

The Financial Stranglehold on Homebuyers

Rising fees are intensifying the affordability crisis as municipalities tax new housing at an alarming rate. Research by the Canadian Centre for Economic Analysis highlighted that a staggering 36% of the cost of a new home can be attributed to taxes, fees, and levies, including DCs. This financial strain hinders builders from delivering homes that are affordable for buyers.

Data from the Canada Mortgage and Housing Corporation (CMHC) reinforces this reality, showing that development charges alone can inflate the cost of new units by over $100,000 in cities with the highest fees. In Toronto, for instance, buyers can expect to pay approximately $130,200 in charges for a typical condo and about $180,600 for an average detached home—constituting roughly nine percent of the home’s total cost.

Despite municipalities arguing for the necessity of these funds, an alarming amount remains idle in reserve accounts. A recent report revealed that Toronto alone holds a staggering $2.8 billion in DCs, with a significant portion allocated to projects benefiting the entire region, including subway improvements. Unsurprisingly, many people question whether it’s fair for new homeowners to shoulder such financial responsibilities.

Efforts and Progress Yet to Be Realized

It’s crucial to acknowledge that not all movements have stalled. The federal government has signaled its intention to reduce development charges significantly, but concrete actions are yet to materialize. In Ontario, Bill 17 was introduced, which allows developers to push back payment of DCs until after the occupancy, rather than at the issuance of a building permit. This change could provide builders with more flexibility and alleviate some financial stress during the construction phase.

Moreover, the elimination of the sales tax on new housing priced up to $1 million for first-time buyers, along with sliding-scale reductions for properties priced between $1 million and $1.5 million, is expected to have a positive impact on accessibility for new homeowners. With first-time buyers representing around 35% of new home purchases, these measures could help alleviate some pressure.

However, there remains a pressing need for a focused approach to tackle the issue of development charges. This effort cannot be overstated, as it will significantly affect the housing landscape.

The Broader Economic Implication of Inaction

The new home and condo market is currently undergoing a significant downturn. At a recently held housing summit, experts warned that Ontario might face the loss of nearly 100,000 construction jobs—a catastrophic consequence that could result in a $10 billion hit to the province’s economy.

In 2023, the construction industry contributed a remarkable $59.1 billion to Ontario’s GDP and employed approximately 596,000 individuals—accounting for 6.8% of the provincial workforce. A faltering residential construction sector could ripple through the economy, resulting in devastating consequences for a multitude of supporting industries.

Recent reports by the Missing Middle Initiative at the University of Ottawa indicate a concerning trend: housing starts in the Greater Toronto Area and the Greater Golden Horseshoe fell by 34% in the first nine months of 2025 compared to the previous three years. Job losses within the industry are continuing to rise at an alarming pace.

The Urgency for Collaborative Solutions

Now, more than ever, we cannot afford to remain passive, hoping the industry will recover on its own. Governments at all levels must expedite the process of adopting strategies that can effectively lower development charges. The stakes are far too high, and the well-being of communities relies heavily on the availability of reasonably priced housing.

Failure to act could leave us with a skewed housing market characterized by increased inequality and diminished opportunities for countless families. Collaboration among policymakers, builders, and community stakeholders is essential to ensure a sustainable housing future.

In conclusion, just as a rowing crew depends on synchronized and coordinated efforts to move forward, tackling the housing crisis will necessitate a concerted approach by all involved parties. Let’s pull together to ensure that a safe and affordable housing market is attainable for everyone.