Municipal Benchmarking

How do municipal processes, approvals, and government fees and charges affect housing affordability in Canada?

This study is intended to help establish standards that municipalities can and should aim to meet, and that industry and the public can and should call for, with supporting data and best practices to show the way. It is an opportunity to start a productive conversation for all, identifying best practices, ways to improve processes, and opportunities for governments and industry to work together to tackle affordability and other housing challenges.

Housing affordability continues to be a challenge in all parts of the country. A key component of affordability is the price of a home, and a major part of the price is the cost to develop and build. In Canada, municipal processes, approvals, and charges have been steadily increasing. This adds cost to building both low-rise and high-rise housing, contributes to higher prices, and ultimately erodes affordability.

The Municipal Benchmarking Study was commissioned by CHBA and delivered by Altus Group. The study compares 23 Canadian municipalities, examining how their processes, approvals timelines, and charges and fees contribute to housing affordability and supply issues in major housing markets across Canada. The report reads as a report card to show which municipal governments are leading in which of the three pillars of the study—planning system features, approval timelines and government charges.

CHBA's Municipal Benchmarking Study
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The research started with data from June 2022 onwards (to avoid overlap with the previous study). The study does not include any potential impacts on housing as a result of the changes a municipality may have made as a result of receiving money from the federal Housing Accelerator Fund.

CHBA CEO Kevin Lee speaking about the Municipal Benchmarking Study on March 4. Watch the recording here.

Summary of Findings

Each participating municipality has been assigned a score that combines their performance on planning features, approvals timelines and government charges. This ranking provides a short-hand to show which municipal governments are leading in which of the three areas at the moment, as well as an overall ranking. The 2024 edition also provides further detail on how a municipality’s performance on these measures influences housing outcomes and the total cost implications of these processes and policies.

1. Planning Process

The general purpose of this section is to help highlight best practices among planning organizational peers to aid in the adoption of methods to improve the application process for both applicants and municipal staff/councils. This section also shows municipal achievements to provide an overview of planning policy and processes trends occurring across Canada. This segment of the 2024 report is meant to be a new platform to more directly facilitate the sharing of ideas between jurisdictions. Among the municipalities studied, the municipalities with the greatest number of identified features deemed as beneficial to encouraging and expediting housing supply were Halifax, Markham, Toronto, Oakville, and London.

2. Approvals

This aspect of the study endeavoured to estimate typical approval timelines for development applications – from complete application to planning approval. The nature of the ‘planning approval’ can take many forms – and may include some combination of a municipal plan amendment, zoning by-law amendment, site plan approval, plan of subdivision and/or development permit.

Depending on the jurisdiction, development approvals are taking between 2 months (Saskatoon) to 31 months (Hamilton). Compared to the findings contained in the 2022 study, there are some notable shifts in average approval timelines

Approval timelines improved marginally from the previous study but remain high, and in some cases the improvement is likely simply because of fewer applications being submitted.
13 municipalities have better timelines than reported in the 2022 study, 5 have the same, and 4 are worse.
The municipality that saw the best improvement in timelines was Halifax with a decrease of 11 months, and the municipality that saw the worst deterioration in timelines was Hamilton with an increase of 8.1 months.

3. Government Charges

This section provides a high-level overview of government charges levied by municipal governments and attempts to quantify the costs these charges and fees generate for developers, home builders, and ultimately, home buyers. Although growth must pay for growth, ever increasing charges are adding to the price of the house for homebuyers and is often supporting investments beyond what would be needed to address the impact of any new development.

Charges to support growth-related infrastructure investments have gone up considerably across most of the municipalities studied. Average development charges and planning fees have gone up by $27,000 per unit for the low-rise development scenario and $3,000 per unit for the high-rise scenario.
Many municipalities impose far more infrastructure fees on low-rise developments than on high rise developments.
On average, there are $82,600 worth of fees levied on new low-rise residential development across Canada. Fees range from a low of $8,700 per unit (or $2 per Sq. ft.) in Moncton, to a high of 195,300 per unit (or $88 per sq. ft.) in the City of Toronto. The top 5 most expensive markets are all in Ontario.
Total combined municipal fees for high-rise developments range from $1,600 in Charlottetown (or $2 per sq. ft.) to $134,900 (or $190 per sq. ft.) for a unit in Toronto. The top 9 most expensive markets are all Ontario municipalities.

Municipal Factsheets

In addition to the report, CHBA has assembled local Municipal Benchmarking Study Factsheets that are available below. These local factsheets summarize the key findings from the Municipal Benchmarking Study for each participating jurisdiction. This study, along with the accompanying factsheets, is meant to help participating local HBAs communicate and collaborate with their municipalities on development processes, approvals and charges.

BWG

Best practice examples

The 2024 Municipal Benchmarking Study identifies ways to improve processes, and outlines opportunities for governments and industry to work together to tackle affordability, supply, and other housing challenges. Some examples of best practices include:

Municipalities can help improve the quality of development submissions by making resources available on their websites to help applicants with their preparation process. By receiving better quality submissions, municipal staff can spend less time on non-review activities and more time reviewing applications, resulting in faster processing.
Have a dedicated webpage for application support materials that includes a list of study requirements for applications, a minimum to be scored, etc.
Ensure that terms of references include statements for when a study is required and when it is exempt.
Provide both in-force and historic zoning data.
Provide search functionality within staff directory that is connected to the planning or building department’s “contact us” page.
Create online submission options for planning applications and building permits.
List specific types of applications that can be applied for.
Have FAQ (frequently asked questions) webpages available to answer common questions.
Provide both a dedicated webpage and an interactive map for active application information.