Ontario is now at least eight years into an undeniable housing crisis. Average resale prices are more than double what they were a decade ago, rents in the Greater Toronto Area (GTA) have risen by a third in just two years, and the rental vacancy rate sits at a very low 2.2 percent. As housing prices have risen, disposable income has not kept pace, increasing the proportion of disposable income spent on housing—this is a Canada-wide issue that is more acute in Ontario, where GDP per capita and real median income growth has been the lowest among the provinces over a 20 year period, and even negative in Toronto.
Beneath those data points sits the structural math: Ontario is about 1.2 million homes short of the G7 per-capita average, a gap the province’s own Affordability Task Force says balloons to 1.5 million homes once population growth through 2031 is factored in.
Fix housing, and you fix a lot more, too
In The Housing Theory of Everything, authors Sam Bowman and co. argue that a chronic shortage of homes doesn’t just inflate asset prices, it silently taxes productivity by pushing workers away from high-wage centres, widening inequality as homeowners watch their untaxed windfalls grow. What’s more, housing is a key factor discouraging family formation, which must be improved if we’re to tackle the impending crunch on our workforce size, productivity, and social service and pension viability, which are under pressure from the confluence of lower fertility, an aging population, and declining workforce as a share of the working age population.
Almost every social problem we like to debate turns out to be downstream of a scarcity of family-friendly housing. Fix the scarcity and you loosen half a dozen other policy knots at once.
Seven years into its mandate, the provincial government can point to a list of reforms, including the elimination of rent control, re-establishment of a strong planning appeals body in the Ontario Land Tribunal, legalization of three units on any residential lot, and some other changes to municipal approval processes.
These have been useful tweaks, but have not come close to meeting the moment. The Financial Accountability Office now reports that Q1 2025 housing starts are as low as they’ve been since 2009. A plan that was meant to accelerate building has, at best, slowed the rate of decline.
A real plan
So what levers are left? The most powerful remain the simplest: legalize more housing, cut the friction costs of building it, make family-friendly housing easier to build, and do all three where the political math is most forgiving.
The Progressive Conservatives hold only a handful of seats in Toronto, Hamilton, and Ottawa, having surrendered or failed to win most urban ridings even in their 2025 majority victory. If Queen’s Park is wary of poking suburban and exurban swing voters, it can focus the bulk of its attention on the downtown NIMBYs instead, and reserve more targeted measures for the outer reaches.
Start with land use. Starting with those three cities, the province could and should permit four-storey buildings on every residential lot, six-to-11-storey buildings on every transit-served street, and larger high-rise buildings with close proximity to major transit stations. This would be consistent with its own Housing Affordability Task Force Report and immediately ease pressure provincewide.
OC Transpo Light Rail Transit trains are shown in Ottawa on Monday, Sept. 25, 2023. Sean Kilpatrick/The Canadian Press.
Despite its bungled attempt at revisiting the Greenbelt, the province should also not shy away from opening more land for low-rise housing development, which young families continue to prefer. Ontario’s fertility rate has seen one of the most precipitous drops in the country since 2010—despite record immigration—and now trails the national average and most productive prairie provinces. Low-rise housing near, but outside, dense urban centres, remains the most desired and most conducive to family formation. Ontario should use its tools to require exurban and suburban municipalities to allow more of these homes by selectively eliminating exclusionary zoning and through the promotion of urban boundary expansion. This would enable small, detached, semi-detached, townhouse, and multiplex builds in key areas, and tie provincial funding to municipalities with these kinds of family-friendly housing targets in their plans.
Ontario’s Protect Ontario by Building Faster and Smarter Act addresses costly municipal development processes and charges—fees that can add up to $200,000 to a home and total $3.5 billion annually. The act caps required studies and eases changes to development charge by-laws when lowering fees. However, development charges fund core municipal services and infrastructure, making major reductions difficult without disrupting budgets and long-term planning. To meaningfully improve affordability, Ontario should seriously consider a cost-sharing model that offsets these charges, allowing municipalities to reduce fees without undermining service delivery or growth planning. This could make housing both more plentiful and more affordable. Without it, we could be waiting for years before meaningful change.
Next, approvals. Although the province has attempted various ways to expedite these processes, many cities in Ontario remain among the slowest in the developed world. The province’s best tool remains the Ontario Land Tribunal, where development applications could be appealed both on refusal decisions and non-decisions. It just lacks the manpower to review these appeals quickly. Doubling the number of adjudicators and triaging nuisance cases within thirty days would unclog the docket and signal to city halls that delay tactics will not be accepted.
Finally, simplify how we build. Bring Ontario’s Building Code in line with best-in-class international practice by permitting single-stair (single-egress) apartment buildings up to at least six storeys and authorizing the smaller “European-sized” elevators that already serve such midrise blocks elsewhere. These changes would shrink cores, save material, and unlock more leasable and sellable floor area, making tight urban infill far more viable. At the same time, launch a thorough, data-driven review of every energy-performance and accessibility mandate. The goal should be clear: keep the measures that demonstrably improve safety, sustainability, and inclusion, but pare back or redesign those whose costs outweigh their benefits, so that higher standards and greater affordability can advance together rather than at odds.
This government is running out of time
The next provincial election is booked for 2029. A midrise development proposal filed this summer will not be occupied by then, but cranes in the sky and crews on-site are photogenic proof of progress. Another year of record-low starts will instead dominate every door-knock and debate stage. Policy is path-dependent. Once as-of-right zoning, capped fees, and fast permits are on the books, a future government will find it hard to revoke them.
The choice in front of Queen’s Park is stark: Continue to tinker and preside over the slowest housing starts in 15 years, or wield the constitutional hammer the province already owns, concentrate reforms where the political downside is smallest, the supply upside greatest, and family-friendliness most pronounced. It can put visible momentum on the ground before voters head back to the polls. Ontario has talked about the housing crisis for eight long years. It will take an equally decisive eight-month sprint to show that talk can finally translate to real results.
