Corinne McCabe , Broker

Multiplexes can now be built in all neighbourhoods, meaning duplexes, triplexes and fourplexes can be built, without special permissions, in all neighbourhoods from Rosedale to Westmount that are currently dominated by detached and semi-detached houses across Toronto after approval from the city council Wednesday, a move intended to increase low-rise housing options in existing communities. 

This controversial move to expand as-of-right permissions for multi-unit residences is a centrepiece of the city’s housing action plan to meet a target set by Premier Doug Ford’s provincial government of adding 285,000 homes by 2031. Previously, 70 per cent of Toronto’s residential areas only permitted single detached homes with zoning amendments and additional approvals required if another form of housing was proposed. 

The plan to remove the exclusionary zoning policy has faced significant opposition from many residents’ associations who argue that the changes could have negative consequences, including increased traffic, lack of parking options and a loss of trees. Some organizations, including the Federation of North Toronto Residents’ Associations, representing 30 neighbourhood groups, called on the city to defer the decision until a new mayor is elected next month. They also said it would be better to pilot the plan in select communities rather than make a widespread rollout in order to monitor and make adjustments if issues arise. 

The new framework, allows new multiplexes to be built up to 10 metres high, or three storeys, as long as the design keeps with an area’s existing “physical features.” In areas where taller buildings are already allowed, four-storey multiplexes may be possible, the new rules say — and where the lot is large enough, the rules allow a multiplex abutting a garden or laneway suite. That would total five residential units on larger lots. 

City staff are also expected to advance further policy changes in the coming years to boost density, starting with a final set of recommendations on allowing four- to six-storey walk-up apartments on major streets in residential areas, which staff expect to release later in 2023. 

Toronto will launch a monitoring program to track the uptake and distribution of multiplexes across the city, as well as document concerns or barriers that arise, including impact on parking and trees. A report is scheduled to come back to council by early 2026 or sooner if 200 multiplex building permits have been received by the city.

• Introducing a two-year ban on non-resident, non-Canadians purchasing residential property to help curb speculation and ensure that houses are used as homes for Canadians to live in, rather than as financial assets for foreign investors;

• Introducing a one per cent annual underused housing tax on the value of non-resident, non-Canadian owned residential property that is vacant or underused;

• Introducing a new Tax-Free First Home Savings Account to allow Canadians to save up to $40,000, tax-free, to help buy their first home;

• Making sure that profits from flipping properties held for less than 12 months are taxed fully and fairly;

• Doubling the First-Time Home Buyers’ Tax Credit to provide up to $1,500 in direct support to home buyers to offset closing costs involved in buying a first home;

• Introducing a new, refundable Multigenerational Home Renovation Tax Credit, which will provide up to $7,500 in support for constructing a secondary suite for a senior or an adult with a disability, starting in 2023;

• Applying the Goods and Services Tax/Harmonized Sales Tax to all assignment sales of newly constructed or substantially renovated residential housing, to help address speculative trading in the housing market;

• Launching a new $4 billion Housing Accelerator Fund to remove barriers and incentivize housing supply growth, with the goal of creating at least 100,000 net new homes across Canada;

• Launching a $200 million stream under the Affordable Housing Innovation Fund to develop and scale up rent-to-own projects;

• Launching a third round of the Rapid Housing Initiative, which is providing $1.5 billion to create 4,500 new affordable housing units for Canadians in severe housing need, with 25 per cent of investments going towards housing projects targeted towards women;

• Budget 2023 delivers on this commitment and announces that financial institutions will be able to start offering the Tax-Free First Home Savings

Account to Canadians as of April 1, 2023. 

• That is why the federal government, through the Financial Consumer Agency of Canada, is publishing a guideline to protect Canadians with mortgages who are facing exceptional circumstances. Specifically, the government is taking steps to ensure that federally regulated financial institutions provide Canadians with fair and equitable access to relief measures that are appropriate for their circumstances, including by extending amortizations, adjusting payment schedules, or authorizing lump-sum payments. Existing mortgage regulations may also allow lenders to provide a temporary mortgage amortization extension— even past 25 years.

Toronto Real Estate Prices Just Made The Biggest Monthly Jump Since Rates Began Climbing

TRREB data shows home prices climbed in February. Prospective buyers with their buyer-feet ice cold in the snow, stood puzzling and asking, how can it be so? It came without rate cuts. It came without speculators. it came without cheap credit, stimulus, or foreign buyers.

The average price increased in the GTA for the first time since August 2022. This could indicate that the market may have found its way off the downward trajectory and back into a seasonal cycle, as prices typically rise from January to February.

The average sale price in the GTA came in at $1,095,617 – down 17.7% compared to the same month last year but up $57,000 or 5.5% from January. For the City of Toronto, the average sale price for February was $1,071,043 - down 11.5% compared to the same month last year but up $83,000 or 8.4% from January.

It has been almost a year since the Bank of Canada started raising interest rates (8 times). Home prices have dropped over the last year from the record peak in February 2022, mitigating the impact of higher borrowing costs. Many homebuyers have also decided to purchase a lower priced home to help offset higher borrowing costs.

The share of home purchases below one million dollars is up substantially compared to this time last year,” said Toronto Regional Real Estate Board (TRREB) President Paul Baron. GTA REALTORS® reported 4,783 sales through TRREB’s MLS® System in February 2023 – down 47 per cent compared to February 2022, the last full month before the onset of interest rate hikes. The number of new listings entered into the system was down by a similar annual rate of 40.9 per cent to 8,367. 

Easing inventory pressures are reinforced by other major demand indicators. Active listings, the total remaining inventory, climbed 38.1% to 9,643 homes in February. Fewer sales and more inventory aren’t traditionally fuel for higher prices. That leaves a shift in buyer psychology as the culprit.

Has there been a shift in buyer psychology driven by the Bank of Canada? It’s impossible to nail down what caused the shift without asking every buyer. Even then, what a buyer says can differ greatly from their reasons. That aside, two major factors are contributing—mortgage rates and the Bank of Canada (BoC).

Does this mean the correction is over? Not exactly, it doesn’t indicate much in terms of market direction. One month doesn’t make a trend, and prices never move in a straight line. Most corrections also face a period where a group of consumers on the sideline jump in and call a bottom.

Sometimes they’re right and call the bottom—like Toronto homebuyers in 1996. Other times they learn that academics refer to this as the “return to normal” phase of an asset bubble.