A series of public meetings about the Ontario government's controversial Greenbelt Protection Plan begins November 8. The meetings are sure to create fireworks, as environmentalists in favour of the sweeping land controls face off against builders who say the plan is the opposite of what future homebuyers want.
The proposal is intended to curb unplanned urban sprawl by prohibiting new development on an area of 1.8 million acres around the Greater Toronto Area and Ontario's Golden Horseshoe. Already the most populous area of Canada, the region is expected to grow by about four million people by 2031 -- the combined population of Vancouver, Calgary and Edmonton, the province says.
"Preserving our greenspaces will help build stronger communities, improve our health and protect our water and air," said Premier Dalton McGuinty in announcing the plan. It's intended to protect agricultural land and the province's water systems, while encouraging growth and higher density in cities and towns outside the greenbelt.
"Our plan will strike a balance between protecting our greenspaces and meeting the needs of growing communities," said McGuinty. "It will help us build the kind of Ontario we all want to live in -- and that we can be proud to leave to our children."
But the Greater Toronto Home Builders' Association (GTHBA) says a survey it commissioned shows "the public isn't buying" the government's growth management plan. President Mark Parsons says "most people want to live in a single-family home in a suburban location, and they want the government to deal with transportation gridlock more than anything else. What they don't want is to live in more dense housing in more compact communities in already developed areas."
He says, "The public thinks the most likely outcome of provincial meddling in the housing market is going to be higher prices."
The Toronto Real Estate Board is also concerned that the land restrictions will drive up the price of housing. "Does the provincial government really want to tell low or moderate income homebuyers that to own a home in the GTA, their only choice will be a condo apartment?" says TREB president Ron Abraham.
"Unfortunately, if land shortages continue, that might be all that is affordable for more and more people."
That view appears to be supported by the latest housing forecast issued by Canada Mortgage and Housing Corp., (CMHC) which says that affordability issues are already impacting the new-home market. It says "fewer serviced lots available for development continue to push up lot prices, which inevitably feed through to low rise home prices. Single detached home prices are up nearly seven per cent year-to-date ... supply prices for high-rise serviced lots are not as extreme." CMHC says, "Prospective homebuyers looking for value will likely substitute out of more expensive detached housing into other dwelling types. Townhomes, and to a lesser extent semi-detached homes, represent an affordable alternative, with the required household income to finance a home significantly lower and below current average household incomes in Toronto."
A non-profit group, Environmental Defence, says the developers are "fear mongering," and has produced a report that says there is no factual basis for claims that the greenbelt will lead to higher housing prices.
"Housing prices, or more accurately, affordability, are tied much more closely to interest rates, the 'catch-up' effect after a declining market, availability, speculator panic and (the) job market, than to land prices. From the beginning of 1985 to the end of 1989, for example, housing prices in the Toronto area more than doubled. There were no extensive greenbelt initiatives or legislation at the time."
Environmental Defence says that some of Toronto's most sought-after neighbourhoods, such as the Beaches, Riverdale and East York, have much higher densities than the suburbs but continue to attract eager buyers.
"Developers don't have a leg to stand on when they say the greenbelt will create higher home prices and that we are running out of available land," says Rick Smith, executive director of Environmental Defence. "As it turns out, most of our existing green space is so poorly protected we can't afford not to create the greenbelt."
A major focus of the plan is the protection of agricultural land, but there has been no provision made to compensate farmers who now may not be able to sell their land for development. The Ontario Federation of Agriculture says in a submission to the government: "The greenbelt proposal has the ability to destroy the economic viability of farmers in the greenbelt area. Already we have heard anecdotes of farmers within the study area being denied operating loans, and only being offered reduced loans, due to the uncertainty caused by the greenbelt proposal."
"The loss of equity takes away the incentive to further invest in the farm operation. The government must examine mechanisms for compensation for the loss of farmer viability and equity."
The first public meeting takes place in Markham on November 8.