Inclusionary Zoning and Affordable Housing

This fall, City Council adopted a new inclusionary zoning (IZ) policy framework which will require developers to provide affordable housing units as a part of new projects. Initially, the City will require 5-10% of new condominium developments to be affordable housing and these rates will increase to 8-22% by 2030 as the policy is fully phased in.

The affordable housing set aside rates have been established based on three distinct "Market Areas" and will begin increasing on an annual basis in 2025. All affordable units secured through the IZ policy will be required to remain affordable for 99 years. You can find more information about the Market Areas, set aside rates, and rent limits on the City's IZ webpage.

Unfortunately, the Provincial government has limited Toronto's ability to implement inclusionary zoning to officially-designated Protected Major Transit Station Areas (PMTSAs). This means that the IZ policies and by-law will apply in certain areas of the City, within 800m of a major transit station. City Council has now begun officially designating PMTSAs across Toronto, which will then require approval from the Provincial Minister of Municipal Affairs before the Inclusionary Zoning policy can be applied to new developments.

While I am very pleased to have this new framework in place, I am concerned by the slow pace of implementation. Already, I have noticed a significant uptick in new applications for developments in close proximity to transit stations. In Ward 15 – Don Valley West, we currently have 24 active applications for major developments, many in future PMTSAs. Until the policy officially comes into force and PMTSAs are formally established, we are missing key opportunities to secure affordable units in fast-growing areas of the City, such as Midtown.

That's why I voted in favour of a motion to accelerate the phase in of the plan and pursue more ambitious affordability targets. Developers have made enormous profits from Toronto's housing market and should be paying their fair share to bolster our affordable housing stock. While the motion did not pass, I will continue to support more wide-reaching policies and faster implementation of IZ across Toronto.