The City is currently reviewing its definitions of Affordable Rental Housing and Affordable Ownership Housing. The review of these definitions will help ensure that rents and ownership prices set by the City are appropriate and affordable for low- and moderate-income households. Changes to the definitions have been proposed for public consultation. The proposed change to Affordable Rental Housing responds to Action 52 in the HousingTO 2020-2030 Action Plan.

Toronto’s Official Plan and Municipal Facility Housing By-law currently defines Affordable Rental Housing as:

  • Housing where the total monthly shelter cost (gross monthly rent including utilities – heat, hydro and hot water – but excluding parking and cable television charges) is at or below the average City of Toronto rent, by unit type, as reported annually by the Canada Mortgage and Housing Corporation.

The proposed Affordable Rental Housing Definition would define Affordable Rental Housing as:

  • Housing that is intended to cost less than 30% of households’ before-tax income in the City of Toronto, and where the total monthly shelter cost (gross monthly rent including utilities – heat, hydro and hot water – but excluding parking, internet and cable television charges) is the least expensive of 100% of Average Market Rent (AMR) by unit type, as reported annually by the Canada Mortgage and Housing Corporation (CMHC), and which is affordable to:
    • for bachelor units, households earning between the 20th and 50th percentile income for one-person renter households;
    • for one-bedroom units, households earning between the 30th and 60th percentile income for one-person renter households;
    • for two-bedroom units, households earning between the 30th and 60th percentile income for two-person renter households;
    • for three-bedroom units, households earning between the 30th and 60th percentile income for three-person renter households.

The table below compares affordable rents for 2021 based on the current definition and the proposed definition. The table also highlights the income required to be able to afford the current and proposed rent.

Unit Type Current Definition & Income Served Proposed Minimum Affordable Rent
& Income Served
Proposed Maximum Affordable Rent
& Income Served
Bachelor $1,211
$48,440
$385
$15,389
$812
$32,486
One-Bedroom $1,431
$57,240
$495
$19,804
$1,090
$43,600
Two-Bedroom $1,661
$66,440
$929
$37,161
$1,661
$66,440
Three-Bedroom $1,887
$75,480
$1046
$41,859
$1,858
$74,301

 

Toronto’s Official Plan currently defines Affordable Ownership Housing as:

  • Housing which is priced at or below an amount where the total monthly shelter cost (mortgage principal and interest – based on a 25-year amortization, 10 per cent down payment and the chartered bank administered mortgage rate for a conventional 5-year mortgage as reported by the Bank of Canada at the time of application – plus property taxes calculated on a monthly basis) equals the average City of Toronto rent, by unit type, as reported annually by the Canada Mortgage and Housing Corporation. Affordable ownership price includes GST and any other mandatory costs associated with purchasing the unit.

The proposed definition would define Affordable Ownership Housing as:

  • Housing which is priced at or below an amount where the total monthly shelter cost (mortgage principal plus interest – based on a 25-year amortization, 10% down payment, and the chartered bank administered mortgage rate for a conventional 5-year mortgage as reported by the Bank of Canada at the time of application – plus property taxes calculated on a monthly basis) does not exceed 30 percent of gross annual income for households within the moderate income range, defined as the 30th to 60th income percentiles, depending on unit size. More specifically:
    • bachelor units must be affordable to households with incomes no higher than the 30th percentile;
    • one bedroom units must be affordable to households with incomes no higher than the 40th percentile;
    • two bedroom units must be affordable to households with incomes no higher than the 50th percentile; and
    • three bedroom units must be affordable to households with incomes no higher than the 60th percentile.
Unit Type Prices under Current Definition Prices under Proposed Definition
Bachelor $230,300 $197,900
One-Bedroom $272,200 $259,000
Two-Bedroom $315,900 $327,100
Three-Bedroom $358,900 $407,000

 

Affordable rental and affordable ownership housing is typically secured within new private, including non-profit, housing developments. These units are meant to provide housing that is more affordable to low and moderate-income households than typical private market housing.

Official Plan policies that use the affordable housing definitions include rental replacement policies, the large site policy, and when securing new affordable housing as a Section 37 community benefit.

It is proposed that the affordable housing definitions would be used to identify maximum rents and prices and eligible income ranges for new units secured through draft Inclusionary Zoning policies.

Housing programs such as Housing Now and Open Door also use the affordable rental housing definition when setting rents. The City often works to layer together affordable housing policies and programs in order to deepen or extend the affordability of units secured through agreements with the City.

Affordable rental housing and affordable ownership housing is distinct from social housing, such as rent-geared-to-income housing offered through Toronto Community Housing. Social housing is typically intended for households who cannot afford affordable rental housing or affordable ownership housing.

Fall 2020 – Public Consultation Meetings

City Planning hosted three public meetings on the proposed definitions as part of consultations on inclusionary zoning on October 29, November 5 and November 10. Each meeting included a presentation from City staff and time for questions and answers and comments on the proposed definition.

Consultation Materials

Staff Reports

Planning and Housing Committee – September 22, 2020

Proposed definitions of Affordable Rental Housing and Mid-range Rents were endorsed for public consultation. For more information, see the Committee Report and Presentation.

City Council – December 17, 2019

City Council adopted the HousingTO 2020-2030 Action Plan. Action 52 of the Action Plan directs City staff to review options for a revised definition of affordable housing based on 30 per cent of household gross income, consistent with the federal definition of affordable housing.

Planning and Housing Committee – May 28, 2019

Proposed Inclusionary Zoning Official Plan Policy Directions were presented to the Planning and Housing Committee.

The Committee directed that the public consultations on the proposed Official Plan inclusionary zoning policy directions include options to implement and administer an income-based alternative to AMR (average market rent), defining affordable rent as spending a maximum of 30 per cent of gross household income on housing costs. The Committee also directed City Planning staff to consult on the proposed Official Plan inclusionary zoning policy directions and affordable ownership housing definition.

Planning and Growth Management Committee – April 6, 2016

Planning and Growth Management Committee deferred consideration of a new Official Plan definition of affordable ownership housing at its April 6, 2016 meeting in order to report back on this matter in conjunction with inclusionary zoning.

Planning and Growth Management Committee – June 18, 2015

In July 2013, City Planning in consultation with the Affordable Housing Office retained consultants to review the City’s Official Plan definition for Affordable Ownership Housing. On June 18, 2015, the consultants final report, along with a report from City Planning, were considered by the Planning and Growth Committee and the proposed Official Plan policy for the revised definition of Affordable Ownership Housing was endorsed as the basis for a public consultation open house.

Planning and Growth Management Committee – June 18, 2012

The Planning and Growth Management Committee requested the Chief Planner and Executive Director, City Planning to prepare a report for September 13, 2012 meeting of Planning and Growth Management Committee outlining proposed policy amendments to the Official Plan pertaining to the affordable ownership housing policies