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Ottawa renters are holding tightly to cheaper units, while more expensive new builds are sitting vacant, a joint committee of city councillors has heard. <\/p>\n
On Tuesday, councillors from the finance and corporate services committee and the planning and housing committee received a progress update on a housing “acceleration” plan the city adopted last October to make it faster and cheaper to build homes in Ottawa.\u00a0<\/p>\n
The update said that while overall rental vacancy rates in Ottawa are approaching three per cent \u2014 the threshold for what is considered a balanced market \u2014 units with low rents have a vacancy rate under one per cent, showing that these units are not turning over.\u00a0<\/p>\n
Meanwhile newly built rental units have a vacancy rate of 6.7 per cent, suggesting that the cost to develop new units “requires rents to be set at levels that people cannot afford,” according to Will McDonald, director of the City of Ottawa’s strategic projects office.<\/p>\n
‘Frozen market’<\/p>\n
Tuesday\u2019s update included a review of the current conditions for housing in Ottawa, with a report suggesting the city is in a \u201cfrozen market,\u201d with the outlook expected to deteriorate in the next few years.\u00a0<\/p>\n
\u201cOur overall findings are stark. Almost no typical development scenarios currently pencil out,\u201d reads the report from Bloomberg Associates, which has been working with the city to research the impact of policy and other interventions on residential development and housing affordability in Ottawa.<\/p>\n
In the current economic environment, developers can\u2019t produce sufficient housing to meet demand, despite policy and incentives from all levels of government.\u00a0<\/p>\n
Major factors driving up costs are outside the city’s control, including hard construction costs such as the price of materials like concrete; interest rates; and broader macroeconomic factors such as the availability of debt capital.\u00a0<\/p>\n
\u201cThis underscores the importance of focusing on the levers the city does control, so that when macroeconomic conditions eventually improve, development feasibility can recover quickly,\u201d according to Bloomberg Associates, a pro-bono consulting firm founded by former New York mayor Michael Bloomberg to advise municipal leaders around the world.<\/p>\n
Among the changes the city could make is permanently reducing development charges, though this would impact Ottawa\u2019s ability to fund infrastructure unless funding from other levels of government or elsewhere offset the deficit.\u00a0<\/p>\n
Coun. Glen Gower, the vice-chair of the planning and housing committee, asked whether reducing development charges by 30 to 50 per cent would increase the number of viable building projects.<\/p>\n
\u201cIt would certainly move the needle,\u201d said Simon Mettler of Bloomberg Associates, adding that any reduction in development charges would have a “meaningful impact on returns” to the point where certain projects that are not currently viable might proceed.<\/p>\n
Beyond that, the city\u2019s ability to bring down housing costs are limited.\u00a0<\/p>\n
\u201cThe donation of public land is really the one action that I think could have a significant impact,” said Namon Freeman, also of Bloomberg Associates.\u00a0<\/p>\n
So far the city has implemented 53 per cent of the recommended actions in the housing acceleration plan, including overhauling the zoning bylaw, increasing the legal capacity to reduce approval timelines, and temporarily reducing certain development charges.<\/p>\n
It hopes to complete 78 per cent of its actions by the end of the year and the remainder next year.<\/p>\n","protected":false},"excerpt":{"rendered":"Listen to this article Estimated 3 minutes The audio version of this article is generated by AI-based technology.…\n","protected":false},"author":2,"featured_media":650541,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[194295],"tags":[49,48,20739],"class_list":["post-650540","post","type-post","status-publish","format-standard","has-post-thumbnail","category-ottawa","tag-ca","tag-canada","tag-ottawa"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/650540","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=650540"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/650540\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/650541"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=650540"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=650540"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=650540"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}