Developers want a break from Toronto building fees. Here’s how much those costs have gone up in 10 years — and who pays if builders don’t

Over the past decade, development charges in Toronto have surged dramatically, placing significant financial pressure on developers and, ultimately, homebuyers. In 2010, the fee for constructing a single-detached home was $12,910. By 2024, this charge had escalated to $141,139, marking a 993% increase.

These development charges are levied by municipalities to fund infrastructure and services required for new developments. However, the steep rise has sparked concern among industry professionals. Marlon Bray, Vice President at Clark Construction Management, criticized the hikes, stating, "It's horrendous and it makes no sense."

The impact of these escalating fees extends beyond developers. Homebuyers often bear the brunt, as increased development charges contribute to higher property prices. In the Greater Toronto Area (GTA), government taxes and fees add approximately $355,000 to the cost of an average single-family new home.

In response to these challenges, some municipalities have taken steps to alleviate the financial burden. For instance, Vaughan reduced its development charges for low-rise residential units from $94,466 to $50,193, aiming to encourage more housing projects and address affordability issues.

Despite such measures, the overall trend of rising development charges continues to raise concerns about housing affordability and availability in Toronto. Industry stakeholders argue that without substantial reforms, these fees will continue to hinder new construction projects and exacerbate the housing crisis.

The debate underscores the need for a balanced approach that ensures necessary infrastructure funding without imposing prohibitive costs on developers and homebuyers. As the city grapples with housing challenges, policymakers face the task of creating an environment conducive to development while maintaining fiscal responsibility.