OPINION: Municipal election candidates need to ensure approval pipeline for new developments is part of housing strategy

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As I do in the lead-up to every municipal election in the Greater Toronto Area (GTA), I use this column to outline the issues and policy matters that critically impact housing supply and affordability across the region so that readers can engage with candidates and assess campaign promises for the issues that matter to them.

Municipal approvals, approval timelines and service delivery are one of those issues that materially impacts how many new homes come to market, when they come to market and how much they could cost.

All new housing supply that comes to market in Ontario and the GTA occurs in a pipeline. Most readers will be familiar with the later stages of development because it is clearly visible – these are the excavation, building and completion stages.

However, the journey to a completed new home with proper permissions begins with planning and municipal approvals.

The planning and approvals stage is the first step with a government interface – this is when plans for new housing units are submitted by builders and developers to their respective municipalities and are reviewed to ensure they conform with local zoning and the myriad of planning requirements that each municipality has.

While work on projects by individual developers and builders pre-dates this stage often by many years, this initial stage is where the housing pipeline takes shape in a meaningful way and is one of the first formal gates in the development process. As such, it can determine much of the rest of the process for new housing development.

Once new housing units receive draft plan approval, they can progress to the next stage in the development process.

However, it is important to note that we know empirically that there is a large drop-off between the plans that receive approvals and the ones that eventually proceed to construction and completion.

So, just because 100 housing units receive planning approval, it does not mean that we end up with 100 new homes at the end of the pipeline.

We also know that if the approvals stage takes an extended period of time – sometimes years – that significant additional cost is added and can negatively impact the viability of the project. Unfortunately, GTA municipalities boast some of the lengthiest approval times in Canada and North America.

BILD’s municipal benchmarking research has identified that for each month of delay, it can add between $2,673 per unit per month to $5,576 per unit per month, depending on housing type and location. Or, based on average approval times in the GTA between $43,000 to $90,000 per unit, per application submission.

Both of these things signal why it is critical to have an effective and efficient planning approval system for new housing that maximizes the number of units that are approved.