It is very disappointing to hear that Paul Calandra — Ontario’s new Minister of Municipal Affairs and Housing — is talking about “use-it-or-lose-it” zoning policies and that mayors are coming out in support of it. This is a terrible idea.
On the surface, it may seem like this would force/incentivize developers to build more housing sooner. But what it fails to recognize is this: just because a developer wants to build, it doesn’t mean that they are able to build.
This current market environment is a perfect example. It is likely that the Greater Toronto Area will see dozens of new condominium launches this fall. These are developers who will be spending millions of at-risk dollars to bring their projects to the market in the hopes of pre-selling homes and then obtaining construction financing.
However, it is highly probable that not all of these projects will actually start construction in the short-term. And if/when that happens, it will not be because these developers are just squatting on entitled land; it will be because they can’t get financing. In other words, the market isn’t there.
This will not be a good day for anybody. So I fail to see how it makes sense to penalize developers who happen to find themselves in this unfortunate situation. It’s as if our only solution to the current housing crisis is to make it more expensive to build new housing.
For another post that I wrote on this topic, click here.
BRANDON DONNELLY 
I agree with your position, however, in cases where there is limited servicing capacity and servicing capacity is allocated to zoned sites, then it could be a problem if allocated sites are impeding other sites from receiving servicing allocation.
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Fair comment. However, usually when there’s inadequate servicing capacity, the developer is asked to pay for the upgrades.
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This can, and has, worked when improvements such as buildings or upgrades are untaxed, while land is taxed heavily to encourage development or sale to someone else who will develop the land.
This is called a Land Value Tax and it has hundreds of years of informal and, more recently, formal, proof.
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Wouldn’t this allow developers who do have the financing together to in-fact get shovels in the ground quicker? We need a all hands on deck approach to the housing crunch across many area’s, developers shouldn’t be allowed to hoard land in perpetuity.
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Of the ~20 condo launches expected this fall in the GTHA, how many do you think have their “financing together”?
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