Developers say Ontario’s new affordable housing pricing will mean selling homes at a loss

New affordable housing definitions have been released by the provincial government but some in the building industry say they're too low to make any money.

Ontario’s bid to build new affordable housing amid a cost-of-living crisis is hitting a bump as builders turn their noses up at a list of affordable sale prices released by the government for developers who want to qualify for rebates.

At the beginning of June, the Ford government released its definitions of affordable housing for every municipality in the province, setting the price developers would need to sell at if they want to have some taxes and fees refunded.

The definition is broken down by housing type and location across the entire province. In Toronto, for example, a detached house would need to be sold at $366,500 for it to be considered an affordable home and therefore excluded from some development fees. It would need to sell for $438,300 in Ottawa and $434,800 in Mississauga.

Richard Lyall, president of the Residential Construction Council of Ontario, said it was “impossible” for developers to avoid losses on any house built at those prices, even if they had fees waived.

“I don’t see that in Toronto,” he told Global News.

A spokesperson for the Ministry of Municipal Affairs and Housing said the affordable definitions were deliberately geared toward income and had been widely consulted upon.

“The general feedback was that to truly help more moderate-income Ontarians find homes, the definition of an affordable residential unit needs to reflect market conditions and incorporate income factors,” they said.

“The definition of affordable housing was revised to better reflect the ability of local households to pay for housing while recognizing the diversity of housing markets across the province.”