There are a number of affordable housing plans being thrown around in Toronto right now given that we have a municipal election coming up this fall. 

From what I have read, the plans are largely centered around surplus and/or available public land and possibly some subsidies. 

These subsidies are very important because the money has to come from somewhere. This is often overlooked.

In light of these debates, I thought I would share a short Bloomberg video that my friend Evgeny shared with me this morning all the way from Tokyo.

The video is about how Singapore fixed its housing problem. If you can’t see it embedded below, click here.

[youtube https://www.youtube.com/watch?v=2cjPgNBNeLU?rel=0&w=560&h=315]

It strikes me as being very Singaporean.

Over the weekend I watched this interview discussion between Elon Musk and Marques Brownlee. If it doesn’t show up below, you can find the video here.

[youtube https://www.youtube.com/watch?v=MevKTPN4ozw&w=560&h=315]

Elon figures that if Tesla works really hard they could probably come out with a USD 25,000 car in about three years. The key to that affordability is twofold: (1) design & technology improvements and (2) scale. 

So part of the answer is just time. As design and engineering iterations continue to take place, the components will become better and cheaper, just as they have for things like cell phones. Elon estimates that we’re in the 30th iteration of the cell phone today.

But the second factor is simply volume. And that got me thinking about housing production and the similar importance of scale and density. We do a lot to limit volume, despite saying we want more affordable housing.

A bunch of people have asked me lately about what they should do if they want to get smarter on land use planning and on the entitlement process for development projects. It was specific to Toronto, but I don’t think my answer is specific to only this city.

I took a few planning classes in graduate school when I was in the US. But I was more focused on architecture and real estate, and so I did not leave school an expert by any means.

I learned about the failures of euclidian zoning and about things like the Low-Income Housing Tax Credit, which always seemed like a sensible supply-side tool to get the private sector to invest in affordable housing.

But what I have found most useful is to just read planning staff reports. These are the responses to actual development proposals and they show you how staff interpret the policies that are in place and how staff apply them to real buildings.

I may be in the minority in that I actually find these reports interesting. But regardless, they are a great crash course in planning and development approvals and they can help you manage your entitlement risk.