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Throughout October UrbanToronto is featuring a special State of Housing editorial series to examine the pressing housing challenges facing Toronto and the Greater Golden Horseshoe.
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The housing headlines of 2025 paint a picture of a declining real estate market, where prices are finally dropping across most of the GTHA, and available listings are skyrocketing. Yet, housing affordability still remains far out of reach for a large portion of the population. As all levels of government continue their efforts to address the region's housing affordability crisis, CivicAction is leading an initiative that delves deep into the issues and impacts of the crisis, particularly on middle-income workers. Their first report, which you can find our more about here, took an in-depth look at the human impact of the housing crisis, reframing the narrative by putting people back at the centre of the issue. Now with their second report, titled The Math: Cracking the Code of Affordable Housing for Workers, the team took a close look at the math behind the existing development system to understand just what is happening to put housing affordability out of reach for most residents in the GTHA. UrbanToronto had the pleasure of speaking with Leslie Woo, CEO of CivicAction, about the report.
The first part of the report takes a look at the pieces of the current development system and the math behind them to understand where the final price tag of a house that we see really comes from. There are three main components: the process of building, from design through to construction; the rules of engagement to access capital, meaning how funding is procured to finance the construction of housing; and the economy, which encompasses broader current events that impact the economic health of the country and therefore the demand for and willingness to build housing. All of these factors are interwoven and complex, and not all are within our control, but Woo argues that solutions are easily within reach if the right approach is taken.
"The development system section [of the report] tries to explain the number of interconnected but numerous variables," explained Woo, "and it's not a simple math or a simple formula like when people say we just need to deliver more supply, and everything will be healed. This is trying to actually explain that it is a bit more layered with a lot more variables, but by the time you get to the end of the report, it also says at the same time, this is actually quite manageable."
Woo makes an important distinction that the report focuses on housing affordability, rather than affordable housing. While 'affordable housing' focuses solely on dwelling units, 'housing affordability' takes a more holistic approach to look at many other factors that impact the cost of housing, such as the associated costs of infrastructure to support communities, the cost of commutes for residents, and the costs of childcare associated with living in more remote or suburban areas, among others. For example, while housing may be cheaper further out from the city centre, there are other hidden costs incurred by both homeowners and governments that may offset the economic benefits of the lower price tag.
"The system is working exactly how the system was designed to work, it just wasn't designed for affordability," Woo elaborated. "The good news is, that very same system can generate greater affordability in terms of our housing supply."
The second part of the report lays out the groundwork for a solution that reframes the housing equation to put affordability at the forefront. The report emphasizes that affordability is not determined by any one factor, and proposes an affordability formula of Supply + Finance + Income - Delay = Affordability. Supply refers to the the provision of housing, including the full building process from availability and cost of land, to materials, labour, planning approvals, design, and occupancy. Finance includes the full spectrum of capital required throughout the development and construction process, accounting for all financing components beyond simple construction loans and mortgages. Income refers to the earning capacity of prospective homebuyers, and Delay captures the hidden costs that accumulate when projects face obstacles, such as infrastructure constraints, community opposition, or economic downturns.
"Any one of the elements alone will not solve it," Woo stated. "Each of those has a piece of the solution to addressing affordability, but in and of themselves alone are not enough." Woo cited the hypothetical example of what would happen if the government did away with development charges. While it would lower direct prices of homes for residents, it would not solve the housing affordability problem because it would create other consequences that might end up increasing costs or decreasing quality of life for homebuyers, such as a lack of infrastructure that would otherwise be paid for by those development charges.
The third part of the report highlights nine common myths of housing and dispels them to help refocus the narrative on things that actually make an impact. Some common myths include: "Housing affordability is just about supply and demand"; "Developers make huge profits and could easily reduce prices"; and "Middle-income workers can afford housing if they just save more or move further out". The report details why these often inflammatory statements are misleading and not helpful in the conversation around housing affordability, as they too often represent the oversimplification of a very complex problem.
Woo continues to emphasize that a solution is very much within our grasp, but we must address missing components. Due to the complex nature of the housing crisis, any meaningful solution must involve all levels of government as well as the private sector to collaborate and coordinate to produce a concerted effort at lasting change. "What's also missing, I would say, is not only just coordination, but synchronization," Woo explained. "Which tools to use when and how, what money, where, and for what purpose, and for who? What would be great to see more of is that when any level of government makes an announcement about housing, it recognizes the partnership that is going to be required and the things that other levels of government or the private sector or philanthropy have to put in place for this to succeed. I think we too quickly want to claim that this one action, whatever it is, is going to solve the housing problem, but it's actually the combination that we need more of."
You can read the full CivicAction report by following the link here. CivicAction will be releasing two further reports in the coming months that focus on the players involved in getting housing built in the GTHA, with a final Call to Action aimed at bringing all relevant parties together to implement solutions to the housing crisis. Armed with this new research and a drive for collaboration, CivicAction aims to address the housing needs of the GTHA head on in the hopes of maintaining and broadening the bright and prosperous future of our region.
UrbanToronto will continue to follow CivicAction's reports as they are released, but in the meantime, you can leave a comment in the space provided on this page.
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UrbanToronto's research and data service, UTPro, provides comprehensive data on construction projects in the Greater Golden Horseshoe—from proposal through to completion. Other services include Instant Reports, downloadable snapshots based on location, and a daily subscription newsletter, New Development Insider, that tracks projects from initial application.
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Thank you to the companies joining UrbanToronto to celebrate State of Housing Month.
