Toronto Looks To Defer DCs For “Stalled” Condo Projects With Affordable Units

Toronto is taking steps to address its housing challenges by proposing to defer development charges (DCs) for certain condominium projects that have stalled. This initiative targets multi-unit ownership housing developments that submitted a complete Site Plan Application by March 1, 2025, and allocate between 5% and 10% of their units to affordable housing.

To qualify, these projects must be situated on private land and expected to commence construction within the next two years. City officials believe this measure will expedite the construction of ownership projects with affordable housing components, enabling residents to move into new homes sooner. Additionally, it aims to mitigate potential delays caused by ongoing tariff disputes affecting construction and the broader economy.

Under the proposed plan, the deferred DCs would be payable, interest-free, at the June 2024 rates, either four years after deferral approval or upon condominium approval—whichever comes first. Currently, the average DC for a condominium unit stands at $60,716. The deferral could offer a financial benefit of up to $18,792 per unit over four years, comprising $16,788 from the interest-free period and $2,004 from applying the June 2024 rates. This financial relief is expected to help advance or unlock projects that have been on hold.

City staff estimate that approximately 14,000 units in the development review pipeline could be eligible for this deferral. However, the city's current financial capacity allows for unlocking a maximum of 3,000 units. Implementing this measure would involve deferring up to $182.1 million in cash flow and foregoing $28.3 million in investment returns, but officials assure that planned capital investments will remain unaffected.

This proposal follows a similar initiative approved by Toronto City Council in November 2024, which offered indefinite DC deferrals and recommended property tax reductions for purpose-built rental projects with at least 20% affordable units. The current proposal reflects the city's ongoing commitment to fostering affordable housing development amid challenging market conditions.

The Executive Committee is set to review this proposal on March 19, with City Council deliberations scheduled between March 26 and 28. City staff plan to report back in the second quarter of 2025 on the implementation outcomes and provide an updated financial impact assessment in the second quarter of 2026 based on the approved projects.