"It's pretty straightforward," economist and planner Russell Matthews told the audience, "land use restrictions constrain supply. If demand stays high, that drives prices up." In that simple equation, do policies like The Greenbelt hinder housing affordability? If so, to what degree? What kind of housing does it refer to? How does it relate to socio-economic well-being and regional planning policy? And, within the broader context of these priorities, how much does it matter? 

These were just some of the questions that echoed through Toronto's Reference Library on the night of Thursday, September 15th. In a discussion organized by the Urban Land Institute, a quartet of academics and planners gathered to debate the impacts of Ontario's Greenbelt legislation on housing affordability in the Greater Golden Horseshoe. With the Provincial Growth Plan now under review and a more stringent Greenbelt policy proposed, it was a timely opportunity to consider the topic: can Provincial urban growth policies help or hinder home ownership? 

The urban structure of the GGH, image courtesy of the Government of OntarioThe urban structure of the GGH, image courtesy of the Government of Ontario

Enacted by the Province of Ontario in 2005, the Greenbelt created a permanently protected land area where urban development is not permitted. Designed to curtail sprawl while preserving the ecology of valuable natural environments, the ambitious land use policy has played a crucial role in transforming the scope of the region's development. In tandem with 2005's Places to Grow Act—a part of the Growth Plan for the Greater Golden Horseshoe—the Greenbelt contributed to a new growth pattern that encourages urban intensification and infill development over suburban sprawl.

That much was agreed upon. But can smart growth policies go too far? Presented to the Province late last year, the Crombie Panel's 87 recommendations generally call for growth to be more emphatically channeled into already developed, transit-friendly, urban growth centres—and more 'complete communities'as opposed to greenfields sites. 

***

Arguing that restrictive 'smart growth' policies like the Greenbelt can pose a significant impact on affordability, Matthews was joined by Ryerson's David Amborski. Matthews and Amborski acknowledged the importance of such policies—which protect greenfields lands such as the Oak Ridges Morraine—in tempering urban sprawl and environmental degradation. However, the more stringent land use restrictions now proposed prompted Amborski's question: "are we overregulating?"

"Regions that have implemented restrictive land use policies are also the regions where prices tend to rise the fastest," Amborski noted, pointing to data showing the sharpest price increases tend to come in metropolitan regions where land use restrictions have been imposed. "Housing starts for ground-adjacent units are tailing off," he added, arguing that stricter curtailment of available land is likely to put greater pressure on housing prices.

An overview of ground-related housing starts in the GTA, image via Ryerson UniveAn overview of ground-related housing starts in the GTA, image via Ryerson University

Stressing the aggressiveness of Ontario's proposed Growth Plan amendments, Matthews described the extent of land use restriction as a case of "out-Frenching the French." The GGH's updated policy could—as per recommendations in the Crombie Panel—mandate that municipalities direct 60% of new development towards already built-up areas, building on the existing 40% target. By contrast, the "Île-de-France planning policy calls for 50%," Matthews noted, suggesting that the Province's proposed policy could be excessively restrictive. 

"Housing affordability is a major challenge for the region," Amborski told the audience. In tackling it, "we have to be willing to seriously assess the impacts of land use restrictions," he concluded.

***

Across the stage, Metropole Consulting's Pamela Blais was joined by the University of Waterloo's Marcus Moos. While Blais and Moos acknowledged that the Greenbelt impacts supplyand, by extension, housing pricesat the fringe of the GGH, the pair questioned the impact of land use restrictions on affordability.

"We can all agree that housing affordability is a huge problem," Moos began, "but can we establish causality in land use restriction?" Challenging Amborki's data relating price increases to land use restrictions, Moos pointed out that "the fastest-growing regions are the ones to implement these policies anyway," arguing that overall regional price increases may be more closely tied to overall growth rather than lack of low-density supply at the fringe. There's a correlation, Moos acknowledged, but not a strongly established causation.

Seated left to right; Matthews, Amborski, Moos, and Blais, standing Derek GoringSeated left to right; Matthews, Amborski, Moos, and Blais, with moderator Derek Goring standing, image by Craig White

Instead, Blais and Moos argued that overall price increase is more strongly rooted in overall growth in population and economic output. Specifically, Moos also argued that "accessibility determines the value of land," with prices rising fastest "in the centre, with a proportional increase throughout the region." In fact, the most acute price growth tends to be clustered in the urban core, along with a number of "secondary peaks," Moos added.  

For the more outlying regions directly impacted by Greenbelt legislation, increasing prices are therefore not only a reflection of limited supply, but of Downtown growth. Blais and Moos argued that the problem of affordability is more effectively tackled by finding new ways to increase supply close to Downtown (which, as Blais pointed out, is creating jobs at a quicker pace than other parts of the region) and secondary economic growth centres.

Land us in the GTA (click for a closer view), image courtesy of Neptis RegionsLand us in the GTA (click for a closer view), image courtesy of Neptis Regions

"Land use in the already urbanized area is more important than what we do at the fringe," Blais argued, pointing to the greater accessibility to jobs and opportunities found closer to the Downtown core as a benefit of urban intensification. While developing the increasingly far-flung (and largely car-oriented) regions on the urban fringes can increase supply, Blais noted that a variety of other strategies could yield significantly better results.

Blais suggested that more proactive zoning legislation—in which realistic new density can be added as-of-rightand a stronger strategy to promote "missing middle" development are more effective strategies to increased supply and ease affordability pressure. Moos added that a lack of a National Housing Policy and the dearth of incentives to build rental housing has also distorted the real estate market. These policy changes, Blais and Moos argued, could do more to to support affordability than the continued development of ground-adjacent housing in the expanded Greenbelt. 

Suburban sprawl in Mississauga, image by UT Forum contributor JasonzedSuburban sprawl in Mississauga, image by UT Forum contributor Jasonzed

While the limited supply of land has led to quickly rising prices for single-family homes (and, to some extent ground-related housing in general), Blais noted that prices for condominiums have been slower to rise. Inherent supply limitations are likely to make many single-family homes prohibitively expensive in the long term, but injecting a greater supply of high-rise and mid-rise density—with greater incentives to build family-friendly units—can play a pivotal role in ensuring long-term affordability in the housing market writ large. 

***

Ultimately, the questions raised by the discussion teased out the more nuanced relationships between economic growth, planning policy, and affordability. While land-use restrictions can hinder supply in the urban fringes, Moos stressed that the environmental harms of greenfield developments make for a questionable at best cost-benefit ratio. What's more, such development seems unnecessary considering urban intensification can provide more environmentally sensitive and economically integrated housing supply while creating more diverse and mixed-income communities.

The panel responds to a question from a member of the audience, by Craig WhiteThe panel responds to a question from a member of the audience, image by Craig White

A reduced greenbelt means more available land,  but—considering the alternativesfor what real benefit? It also means reduced green space, increased sprawl, and greater emissions. Balancing the costs and benefits against alternative solutions, those rows of houses seem an awfully small gain for an awfully big price. 

***

What do you think of the proposed changes to Ontario's Growth Plan? Will the increased Greenbelt place excessive pressure on housing supply and affordability? Share your thoughts by leaving a comment in the space below this page.