Addressing Our City’s Housing Crisis - Housing paying for Housing and Introducing a Vacant Home Tax
On any given night, over 8,000 people rely on our shelters, emergency respites, overnight drop-ins, and Out of the Cold programs to find a safe place to spend the night. And, in a city that continues to become rapidly unaffordable, the cost of housing is skyrocketing.
There is no one solution to truly addressing homelessness. We need a continuum of programs and initiatives to create stable and supportive housing for every person in our city who needs it.
One critical tool to addressing chronic homelessness is our city's Housing Allowance program. A housing allowance is a fixed-amount portable housing benefit that is provided directly to eligible households as a monthly benefit, ranging from $250-$600/month, to address homelessness, eviction prevention, and targeted households on the centralized waiting list. Shelter, Support and Housing Administration's 2014-2019 Housing Stability Plan points out that housing allowances are an important tool for the City to provide housing stability to homeless, vulnerable, and precariously housed populations in Toronto. The homelessness stream directly targets households experiencing chronic homelessness (that have been homeless for 6 months or more), who are connected to the program through our shelter and respite system, Streets to Homes workers, and community agencies.
Housing Allowances can be the difference between stable housing and an emergency shelter. Without new investment, thousands of households that might have been able to move out of homelessness with this crucial support will be unable to access it. For every additional investment of $1 million, approximately 200 new households could begin receiving a housing allowance. With 181,000 people on the waiting list for subsidized housing, 15,000 people on the waiting list for supportive housing, and a strained rental housing market, Toronto clearly needs to expand the delivery of housing allowances in 2019.
It is critical that we review options to expand the delivery of housing allowances as an important initiative to address homelessness throughout our city. This is why I introduced a joint motion last year with Councillors Bailao and Bradford, asking City staff to report on funding options to increase the housing allowance program, including the establishment of a new top tier of the Municipal Land Transfer Tax (MLTT).
In 2008, the City of Toronto implemented the MLTT. At the time housing, while expensive, hadn’t reached the levels it has today.
In 2010, only 171 residential properties were sold for more than $3 million. By 2018 that number had increased by 353 per cent to 774 properties. Meanwhile, the highest tier of the Municipal Land Transfer Tax is a 2.5 per cent tax on homes sold for more than $2 million.
It’s time for a modest adjustment to the MLTT program to reflect changes in housing prices, and to make housing more affordable for everyone.
If we were to establish a new MLTT rate of 3 per cent for homes sold for more than $3 million – a Housing Affordability Rate — Toronto would raise more than $5 million every year for 1000 new housing allowances. That’s 1,000 fewer people every year in our shelters, and instead in housing.
Simply put, people who are doing very well and have benefited from the rise in the housing market would in turn help to ensure that those Torontonians struggling to live here can afford a home. I will again be pushing for this adjustment to the MLTT program when City Council votes on the budget next month.
Another important action that our city can take to address the housing crisis is to introduce a vacant home tax. This tool has already been used successfully in other cities. Vancouver’s 1% vacancy tax raised nearly $40 million in 2018, and the number of vacant units decreased by 22% from the previous year. Toronto has approximately three times as many residential units than Vancouver. Further, if revenue can be reinvested into affordable housing initiatives like it has been in Vancouver, we will increase both housing affordability and the number of homes that go back on the market.
We need to put the needs of residents before the needs of real estate investors who are making huge profits by sitting on empty units. We cannot wait - we need to do this now. Sign the petition by Progress Toronto to show your support for a vacant home tax and send a strong message to other Councillors and the Mayor.