In a shocking U-turn, the City of Toronto has essentially ended exclusionary zoning citywide. Exclusionary zoning are the zoning regulations that limit the amount of homes that can be built on a single lot, excluding all forms of housing other than single family homes. Prior to the 18-7 vote by Toronto city council, upwards of 70 per cent of the city was zoned exclusively for single family homes. Now, duplexes, triplexes and fourplexes are allowed in all residential neighbourhoods.
These exclusionary zoning rules artificially limit the housing stock, which limits supply, and all but ensures that supply will never keep pace with demand. The consequence of exclusionary zoning is quite predictable: when supply can’t keep pace with demand, you have rising home prices and rising rents.
This is a huge step in the right direction to address the housing affordability crisis in Ontario, but this progress shouldn’t end within Toronto’s city limits. As anyone looking to buy or currently renting knows, the housing crisis isn’t limited to Toronto, with prices rising significantly in the Greater Hamilton area. In fact, in 2021 Hamilton was one of the top five least affordable cities in North America. In fact, Hamilton was only more affordable than Toronto and Vancouver, and significantly more expensive than major North American markets like Los Angeles, Las Vegas and Tampa Bay.
We know that ending exclusionary zoning works to calm the tide of rising prices, because we have seen it work in other cities. Minneapolis, which abolished exclusionary zoning before the pandemic is a perfect example. The city now appears to be bucking the trend of rising rental prices. Rents for one- and two-bedroom units are actually lower in 2022 than they were in 2019. Some of that presumably can be chalked up to having made it easier to build for increased density.
But, ending exclusionary zoning isn’t just the right policy for addressing the housing crisis. It is also the right policy for enhancing economic growth and protecting the environment.
Research on zoning rules in the U.S. has shown that, by freezing workers out of high-rent areas like New York and San Jose where their productivity would be higher, local zoning rules lowered U.S. economic growth by 36 per cent between 1964 and 2009. That is a significant lag on the economy, and without a doubt the same trend rings true in Canada’s high demand cities like Toronto, Vancouver, and Hamilton.
For those who care about protecting the environment, changing the way Hamilton zones the city should be a priority. In fact, according to the Intergovernmental Panel on Climate Change (IPCC) more compact cities could reduce urban emissions by upwards of 25 per cent. This should be intuitive for policy-makers. If people can live closer to where they work, the stores they shop at, the restaurants they dine at, or where they seek entertainment, they ultimately drive less. Whether it be by foot, transit or bike, compact cities actually allow for people to reduce their carbon footprint, not increase it.
And it isn’t just emissions that are reduced by zoning reform. The same goes for water usage. According to the peer reviewed journal Landscape and Urban Planning, single family irrigation rates are 48 per cent higher than multi family housing units.
Now, Hamilton has somewhat taken housing affordability seriously since Mayor Horwath took office. In fact, as leader of Ontario’s NDP she campaigned on zoning reform province wide. The city is currently in its “public meetings and stakeholder working groups” phase of its inclusionary zoning initiative, with policy change expected for the end of 2023.
Mayor Horwath, and city council, should be looking at Toronto and aggressively moving that timeline forward, because with every month supply fails to meet demand, home prices and rents increase. Now it is Hamilton’s turn to end exclusionary zoning.
Originally published here