They can cause building project costs to spike, body says
Delays in residential project approvals appear to be unduly influencing the state of housing affordability nationwide, according to new research by Canada Mortgage and Housing Corporation (CMHC).
This factor is especially crucial as CMHC is estimating that an additional 3.5 million new units need to be built across Canada by 2030 just to restore a measure of affordability.
“Long approval times for new developments can make building projects more costly,” CMHC said.
“While many of the regulations have important socio-economic goals, the extent and suboptimal implementation of these regulations can limit what developers can do and may hold back the development of new housing.”
CMHC said that regulatory hurdles appear to be the greatest in Toronto and Vancouver, standing out sharply relative to other Canadian markets.
“The Greater Toronto and Greater Vancouver Areas have the longest approval times in Canada, which are almost 4 times as long as regions with more affordable housing,” CMHC said.
“Atlantic provinces, Quebec and the Prairies are much less regulated, having 23% to 34% less land use regulation than the Greater Toronto Area.”
Other elements that have noticeable impacts on Canadian housing affordability include local fees, environmental assessment costs, and other expenses involved with mandated criteria, CMHC said.