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Ontario housing starts up, but still far off needed levels for 1.5 million homes

Ontario Premier Doug Ford, left, looks over at Minister of Municipal Affairs and Housing, Paul Calandra, at Queen's Park in Toronto on Monday, Oct. 30, 2023. THE CANADIAN PRESS/Chris Young

TORONTO — Ontario's fall economic statement showed Thursday that projections for housing starts are up from what the province had expected when the spring budget was tabled, but still well short of the pace needed to build 1.5 million homes.

The Progressive Conservative government has pledged to build that many homes within 10 years, by 2031, but at no point in the next few years does the province expect to even hit 100,000 new homes per year.

Finance Minister Peter Bethlenfalvy's fall economic statement shows the province expects to see almost 90,000 housing starts this year, more or less the same levels for the next two years, then up to about 94,000 in 2026.

Municipal Affairs and Housing Minister Paul Calandra wrote in a letter to municipalities earlier this month that the province was aiming for 110,000 new housing starts this year, ramping up to 125,000 the next year, 150,000 in 2025 and 175,000 per year in each subsequent year.

But Bethlenfalvy said he's not willing to say the government's target of 1.5 million homes is not achievable.

"I'm a Blue Jays fan. I'm not willing to bet that they're not going to win the World Series anytime soon, even though it ended last night," he joked.

"No, you've got to keep going ... It's not about are we going to build 1.4, 1.6, 1.5 (million). The issue is that municipally, federally, provincially, we've got to work together to try to do the best we can."

Calandra, who became housing minister in September, recently reversed two of the key moves on housing made by his predecessor, Steve Clark. 

He introduced legislation to return portions of the protected Greenbelt that had been removed for housing development after reports from the auditor general and integrity commissioner found the process favoured certain developers.

He also walked back plans to expand some municipalities' urban boundaries, saying it had become clear the previous minister's office was too involved in the decisions.

The fall economic statement also includes a new Housing-Enabling Water Systems Fund, which would make $200 million over three years available to municipalities for the repair, rehabilitation and expansion of water, wastewater and stormwater projects. 

Green Party Leader Mike Schreiner noted that the Association of Municipalities of Ontario has estimated that due to a recent provincial law, municipalities will be out $5.1 billion in money they need to fund critical infrastructure for housing, such as sewer lines and roads. 

"If you talk to local municipal leaders, they will tell you that when the government took $5.1 billion away from them, that's the money they need to service homes," he said. "I don't know about the rest of you, (but) I want to live in a home that when you turn the tap on, water comes out. When you flush the toilet, it goes somewhere."

The government said the new water systems fund complements the Building Faster Fund, which is set to dole out $1.2 billion over three years to municipalities that meet at least 80 per cent of their provincially assigned housing targets.

It was announced after municipalities had been raising concerns for months about a provincial law that cuts some of the fees developers pay, which the communities use to fund housing-enabling infrastructure. 

The former municipal affairs and housing minister had contended that municipalities were sitting on billions of dollars in reserve funds and launched third-party audits of municipal finances to see if the municipalities do indeed have a shortfall.

This report by The Canadian Press was first published Nov. 2, 2023.

Allison Jones, The Canadian Press

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