Building the Homes Canada Needs Doesn’t Have to Cost Us Our Climate Goals – Here’s How

Is it possible to build the housing Canada needs without blowing our carbon budget and improve housing affordability? A new blueprint report (external link)  by the national Task Force on Housing and Climate (external link)  presents ten recommendations and 130 policies that indicate the answer is “yes.”  

As a member of the Task Force for Housing and Climate, I have first-hand appreciation of the challenges in coming to consensus among diverse stakeholders – private developers, climate experts, urban designers, housing advocates, leaders from the finance and insurance sectors, and others – on how to tackle the twin crises of climate change and housing affordability. In preparing our newly released policy recommendations, our task force members had to compromise on some fronts, but we also agreed on many smart solutions.

Meeting Canada’s climate targets and addressing housing affordability do not have to be at odds. For example, simply building more non-market housing close to transit (external link)  can check both boxes – reducing tailpipe emissions and household transportation costs related to car-dependent sprawl, saving municipalities money to service new subdivisions, and building affordable non-market homes that are outside of the private market and protected from speculation and financialization.

To this effect, the Task Force's Blueprint for More and Better Housing (external link)  considers where, what, how, and for whom to build. Getting each of these factors right can stack both carbon and cost savings.

Location Matters

Where we build is fundamental to getting housing right. In fact, the International Panel on Climate Change’s most recent assessment  (PDF file) report (external link)  cites that spatial and land use planning offers high potential to address most of the United Nations’ Sustainable Development Goals (SDGs) and offers the greatest strategy to reduce GHGs from transportation.

Most GHG emissions from Canada’s municipalities come from buildings and transportation. However, the proportion for each differs based on location. For example, in the City of Toronto, buildings represent 55% of the city’s emissions, while transportation accounts for 36%. In Brampton, transportation accounts of 60% of GHG emissions, while residential buildings represent 26%.

Climate scientists in the United States show spatial evidence (external link)  that greenfield developments produce nearly four times the greenhouse gas emissions of high-density alternatives, with research finding that doubling urban density can reduce carbon pollution from household travel by nearly half and residential energy use by more than a third.

The Blueprint for More and Better Housing (external link)  recommends the federal government create a model (national) planning code for intensification to align with national climate goals, which sets strong restrictions for protected areas, farmland and wetlands.

Other Task Force recommendations are aimed at creating conditions for walkable neighbourhoods, regulating and incenting intensification, and discouraging sprawl – for example, abolishing parking minimums on residential, commercial or industrial properties and establishing density targets for transit-oriented development.

Location matters for resiliency as well, with the Task Force recommending hazard mapping to ensure no new housing is built in high-risk areas prone to climate impacts, in particular flooding and wildfires.

Density Done Right

Academic research (external link)  shows it’s possible to accommodate Canada’s population growth within our already developed urban and suburban landscapes. But intensification  (PDF file) does not have to mean 80-storey towers everywhere.

The blueprint recommends modernizing the Building Code, along with changes to design standards, incentives and other policies to make it cost-effective to build a range of typologies and unit sizes for both rental and condo buildings to meet the needs of household sizes and preferences.

Some of these recommendations are, for instance: optimizing the repeatability of buildings and floorplates for midrise to secondary suites, and kickstarting a serious industrialization strategy for how we build - off-site factory production of energy efficient panels and components to speed up, green up, repeat and lower the cost of homebuilding.

Currently, our big cities in Canada add density mostly via “tall and sprawl.” Over the past five years, 69% of housing growth in Canada (external link)  was still taking place in greenfields (sprawl).

On the flipside, condo units in many urban markets are getting smaller on average – as demonstrated in the City of Toronto’s report, “ (PDF file) Condominiums: Two Decades of New Housing (external link) ,” showing that while the number of units squeezed into condo projects has increased, the size of the units in 2021 shrunk by 200 SF to an average unit size of 614 SF. There has also been a trend in the  (PDF file) decline of two-bedrooms or more units in the past decade.

Not only are small one-bedroom condos not matched to the needs of many households, but they can facilitate sprawl; if municipalities continue to meet their intensification goals with mostly tall one-bedroom condos, then single-family homes in farm fields will represent the only attainable family-friendly housing option for many.

Getting serious about building lots of secondary suites (external link) , multiplexes, stacked townhomes and midrise (external link)  buildings throughout residential neighbourhoods, via comprehensive programs (external link)  (changing zoning is only the beginning) is critical to  (PDF file) getting density right and creating alternatives to sprawl housing – driving down carbon and providing more attainable family-friendly homes.

Target Markets

About 40% of Canadian households cannot afford (external link, opens in new window)  housing costs greater than $1,600 per month including utilities, with half of those households unable to afford more than $1,050 per month. Yet 95% of Canada’s housing stock is market-rate housing. That’s why experts across Canada are calling for more housing to be built outside of the private market, whereby rents can be geared to household incomes, and based on what Canadians can afford, not what the private market can charge.

The Task Force for Housing and Climate makes dozens of recommendations to scale the non-market housing sector. Canada must at least double its stock of social housing and supportive housing (aka public housing) with direct funding and subsidies, as there is simply not enough to cover existing need across the country; for example, in Toronto there is a 14-year waitlist for social housing.

The not-for-profit development sector has a central and vital role to play in delivering new and ongoing non-market housing for low- to middle-income households. Not-for-profit developers, housing cooperatives, land trusts and community housing corporations reduce costs by 20% to 25% by greatly reducing the profit margin normally anticipated on private development projects. They are capable of delivering more affordable and low-carbon housing per dollar, in perpetuity.

The Task Force blueprint recommends combining these off-the-top cost savings with other initiatives such as preferential federal financing, access to public land, construction grants, relief from GST and HST and other incentives and streamlining (many of which are already provided to private developers) to deliver the scale we need of affordable housing to meet a range of household sizes and incomes from lowest tier to middle.

Current evidence shows that some of our greenest buildings are non-market housing (external link) , so low carbon doesn’t have to negate affordability. It’s also more cost-efficient and environmentally sustainable to target the type of housing Canada needs so that we are building this housing directly – ex. affordable family-sized units – rather than assuming that building a surplus of market-rate supply aimed at middle-income ownership (external link)  will filter (external link)  down to those lower on the housing ladder.

It is more fiscally prudent and less wasteful to prioritize scarce labour, land and resources, as well as our carbon budget, to build the right housing for our current and growing population, head-on.

Another key blueprint recommendation is to develop a seniors housing strategy. Not only would this strategy target supply for a critical and growing demographic, but if seniors have more desirable and suitable housing options in their community, for example co-living, they may be motivated to downsize sooner, and by choice. This could free up the millions of post-war single-detached homes to younger and newcomer families, and reduce demand for new detached housing developed in car-dependent locations further and further away. It’s a win-win.

Preservation is the New Supply

According to housing expert Steve Pomeroy (external link) , Canada lost ten affordable homes for every new affordable unit created between 2011 and 2021. The inequitable processes behind this decline are “renoviction” (evicting tenants to renovate and then hike the rent), “demoviction” (demolishing affordable buildings for redevelopment to achieve higher densities) and the filtering up of affordable housing to more affluent households.

The new blueprint includes vital recommendations to preserve existing affordable housing stock, including a funding program for not-for-profits, municipalities and land trusts to acquire affordable private rental buildings at risk of financialization and to retrofit ageing apartment stock.