Ontario Land Use Policies Make Housing Unaffordable


A poll by highly respected IPSOS, released by BILD-GTA, shows a strong awareness of the Greater Toronto Area’s severely unaffordable housing.

In the 15 years from 2004 to the last pre-pandemic year of 2019, the median detached house price rose more than 160 per cent (inflation-adjusted), about 5.5 times the rise in the consumer price index. Obviously, something is wrong.

In the middle 2000s, the provincial government established the GTA greenbelt, where development is banned. House prices soon began a stratospheric rise, more than doubling relative to incomes by the last pandemic year (2019).

This isn’t surprising as virtually all markets with similarly severe affordability in our eight-nation Demographia International Housing Affordability report have adopted similar bans (such as Vancouver, San Francisco, Auckland, Sydney and London). These bans are associated with substantial land cost increases, often 10 or more times at their inner boundaries. As a result, substantially higher house prices can be expected where urban expansion (pejoratively called “urban sprawl”) is banned.

Meanwhile, the GTA appears to be exporting its new suburbs the province has banned. Toronto census metropolitan area (CMA) lost a net 260,000 intraprovincial migrants between 2016-17 and 2021-22. That many people live in the municipalities of Kitchener or Saskatoon. According to Statistics Canada, the CMAs within 250 km (such as Guelph, Peterborough or Belleville) gained a net 140,000 intraprovincial migrants.

Toronto need not bemoan “sprawl.” Toronto has the highest urban density (the population centre, which is the continuously built up urban area) in Canada, higher than U.S. leader Los Angeles and one-half higher than New York. It is also more than double urban planning icon Portland, Ore., and more than five times that of the least dense large United States urban areas.

The consequences of the ban are severe. Young people can generally not afford the very homes they grew up in, but they were affordable to their parents. Many lower-income households have insufficient incomes to afford the higher prices and add their names to social housing waiting lists. For example, waits in the city of Toronto are over 10 years for one and two bedroom units. For most younger households, a lower standard of living is likely; for some with lower incomes, it’s a transition into poverty.

Read the rest of this piece at Troy media. Reprinted by permission of Frontier Centre for Public Policy.

Wendell Cox is principal of Demographia, an international public policy firm located in the St. Louis metropolitan area. He is a founding senior fellow at the Urban Reform Institute, Houston, a Senior Fellow with the Frontier Centre for Public Policy in Winnipeg and a member of the Advisory Board of the Center for Demographics and Policy at Chapman University in Orange, California. He has served as a visiting professor at the Conservatoire National des Arts et Metiers in Paris. His principal interests are economics, poverty alleviation, demographics, urban policy and transport. He is co-author of the annual Demographia International Housing Affordability Survey and author of Demographia World Urban Areas.

Mayor Tom Bradley appointed him to three terms on the Los Angeles County Transportation Commission (1977-1985) and Speaker of the House Newt Gingrich appointed him to the Amtrak Reform Council, to complete the unexpired term of New Jersey Governor Christine Todd Whitman (1999-2002). He is author of War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life and Toward More Prosperous Cities: A Framing Essay on Urban Areas, Transport, Planning and the Dimensions of Sustainability.

Photo: dispersed employment in suburban Toronto, by author.