Inclusionary Zoning Policy: Overview

Toronto’s inclusionary zoning requirements do not apply to development applications (rezoning, site plan or building permit applications) made before July 1, 2027.

Inclusionary zoning is a policy tool under the Planning Act to help address the housing needs of Toronto’s low-income and moderate-income households. It helps to deliver affordable housing as part of new developments located near transit stations. Other City initiatives are being advanced as part of the HousingTO 2020–2030 Action Plan to address the full spectrum of housing issues.

As our city grows, we want to ensure our neighbourhoods provide housing options for a full range of incomes and households. Creating mixed-income, inclusive communities is key to the City’s economic vitality and livability. Through inclusionary zoning, the City hopes to:

  • increase the supply of affordable housing;
  • continue to encourage market housing development by supporting a diverse range of housing supply; and,
  • create more inclusive, complete and equitable communities.

The following inclusionary zoning requirements apply, based on the Minister’s Regulations (O. Reg. 15/26, O. Reg. 54/25, and O. Reg. 232/18 ) and the Official Plan and Zoning By-law:

  • inclusionary zoning applies to developments located in a both a Minister-approved Protected Major Transit Station Area and an Inclusionary Market Area, as shown on Official Plan Map 37. This key map shows Minister-approved Protected Major Transit Station Areas that are subject to Inclusionary Zoning;
  • developments are required to provide five per cent of the total units or total residential gross floor area as affordable rental or affordable ownership housing;
  • units must stay affordable for 25 years;
  • rents and ownership prices are based on income-based definitions of affordable;
  • mid-rise development proposing fewer than 100 units and less than 8,000 square metres of residential gross floor area are exempt;
  • transition provisions apply. Developments that make a rezoning, site plan or building application before July 1, 2027 are exempt.

    Inclusionary zoning typically creates housing for households earning too much to be eligible for social housing but not enough to be able to afford market rents or prices. These “low- to moderate-income households” generally fall below the and 60th percentile of the income distribution. In the City of Toronto, this includes households earning approximately $44,000 and $112,000 per year, depending on household size. As a policy tool, inclusionary zoning is challenged to create deeply affordable units without additional funding.