Welcome back to Canada's Housing Crisis podcast. I'm Alia. After our last episode about that viral red circle image, I got so many messages from listeners asking me to dig deeper into what's actually causing our housing crisis. And honestly, the more I researched this, the more I realized we need to talk about something that most people don't even think about when they're house hunting or apartment searching. We need to talk about zoning laws. Now, I know, I know.

Zoning sounds about as exciting as watching paint dry, right? But here's the thing that's going to blow your mind. The boring municipal zoning bylaws that nobody pays attention to are literally one of the biggest reasons why housing in Canada costs so much. And get this, some of our most progressive cities, the ones that pride themselves on being inclusive and welcoming, are actually the worst offenders when it comes to exclusionary housing policies. I'm talking about places like Vancouver, cities that talk a big game about social justice,

then have zoning laws that systematically shut out anyone who can't afford a million dollar home. So today, we're going to break this down into two parts. First, I'm going to explain exactly how zoning laws are making our housing crisis worse. And trust me, the numbers are going to shock you. Then we're going to talk solutions because I don't want to leave you feeling hopeless. There are things we can do to fix this mess, and some cities are already proving it works. All right, let's dive in.

Beautiful, expensive Vancouver has 80 % of its residential land reserved for single-family housing. 80%. And we're talking about a city where the average home price is well over a million dollars. Calgary has 67.5 % single-family zoning. Edmonton has 69%. These aren't small numbers we're talking about here. This is the majority of our city's residential land being artificially restricted to the least efficient form of housing. Now, here's where it gets really interesting.

There's this thing called the Yellow Belt, and no, it's not Batman. It's Bat-Origins.20. That's not a martial arts reference. Urban planners use this term to describe those vast areas of single-family zoning that show up in yellow on zoning maps. And here's the crazy part. In these Yellow Belt neighborhoods, you can tear down a modest bungalow and build a massive luxury mansion, but you cannot, legally cannot, build a simple duplex

that could house two families instead of one. Let me give you a stat that really drives this home. In Vancouver, only 35 % of households occupy 81 % of the residential land. Think about that for a second. A minority of households, the wealthy ones who can afford single-family homes, control the vast majority of the most desirable, transit-accessible land in the city. And you know what's really frustrating about this? The demographics tell the whole story.

Residents in Toronto's yellow belt areas are wealthier, more likely to be homeowners, less likely to be visible minorities, and they have access to more trees, parks, and city amenities than people living in the denser parts of the city. This isn't accidental. This is the predictable result of zoning policies that were designed to preserve privilege. Now, let me contrast this with Montreal, because Montreal actually does things differently.

Montreal's housing stock is dominated by duplexes, triplexes, and small apartment buildings. 58 % of Montreal's dwellings are apartments, compared to Vancouver, where it's also 58%. But Vancouver achieves this through high-rise towers while maintaining that massive single-family zone. Montreal does it through what planners call gentle density, those beautiful three-story walk-ups and converted heritage buildings that give neighborhoods like the Plateau their character. And guess what?

Montreal has better housing affordability than Toronto or Vancouver, despite being a major metropolitan area. Coincidence? I don't think so. Here's something that really gets me fired up about this whole situation. We have a democratic problem here. The people who benefit from exclusionary zoning, older, wealthier homeowners vote at much higher rates than the people who are harmed by it. Younger people, renters, families trying to get into the housing market.

So we have this vicious cycle where the people making the decisions are the ones who benefit from keeping housing scarce. I was reading about a Habitat for Humanity survey that found 54 % of Canadians think NIMBY sentiment, that's not in my backyard, is one of the main barriers to making affordable housing available. 54%. More than half of Canadians recognize this as a problem, but somehow our municipal politicians keep caving.

to the loudest voices in the room. And let me tell you about the mechanics of how this actually works on the ground. When a developer wants to build something denser than what's currently zoned, even something modest like a triplex, they have to go through this incredibly expensive and time consuming process called rezoning. We're talking about months or years of public consultations, council meetings, and often pretty hostile community opposition.

Even when developers are willing to jump through all these hoops, local NIMBY groups can delay and sometimes completely derail projects. I've seen cases where a simple duplex proposal gets treated like they're trying to build a nuclear waste facility. The result is that new housing gets built in all the wrong places, far from jobs and transit, because that's where there's less organized opposition. Now, here's where the international context really matters. Canada ranks

37th out of 38 OECD countries for municipal approval process timelines. 37th. We take three times longer than the United States to approve housing projects. Three times longer. No wonder housing costs so much here. But here's the thing that gives me hope. And this is where we transition into talking about solutions. Cities across Canada are starting to wake up and do something about this. Edmonton made the boldest move.

In January 2024, they effectively eliminated single-family zoning citywide. They now allow up to eight units on any residential lot through what they call their small-scale residential zone. And the results? They approved more than 16,500 new dwelling units in 2024. That's a 30 % increase compared to 2023. 30%. When I talk to people about Edmonton's approach, they often worry

that allowing more density is going to ruin neighborhood character. But here's what actually happened. Most of the new development has been modest. Duplexes, triplexes, small apartment buildings that fit right into existing neighborhoods. It's not like downtown cores sprouted in suburban areas overnight. Vancouver followed with their own reforms in 2023, allowing up to six strata units or eight rental units on lots that were previously restricted to single-family homes.

They consolidated nine separate residential zones into one simplified system, making it way easier and faster to build what they call missing middle housing. Toronto finally opened up their yellow belt by allowing duplexes, triplexes, and fourplexes in all low-rise residential areas. This goes beyond what the province required and represents a huge shift for Canada's largest city. Calgary approved changes allowing duplexes and row houses

to be built without requiring that expensive and time consuming rezoning process. And here's the kicker. The city got $228 million in federal funding through something called the Housing Accelerator Fund to support these reforms. Halifax implemented what they call ER3 upzoning, allowing up to eight units on properties that were previously restricted to single family homes. They received $79.3 million in federal funding. And these changes

could enable the construction of over 200,000 new housing units. 200,000. Now, let me talk about the Housing Accelerator Fund for a minute, because this is actually a really smart piece of federal policy. The government put $4 billion on the table, $4 billion to municipalities that remove zoning barriers. So far, they've signed 179 agreements with commitments to fast-track over 750,000 housing units over the next decade.

The funds specifically reward cities for eliminating single-family zoning restrictions, streamlining approval processes, encouraging transit-oriented development, and creating missing middle housing. It's basically using federal dollars to incentivize the exact zoning reforms we need to see. But you know what? Zoning reform by itself isn't enough. We need to tackle this crisis on multiple fronts. Let me tell you about some of the other solutions that are starting to work. First, we need to talk about public land.

The federal government has been mapping out underutilized sites through their Public Lands for Homes initiative, and they've identified over 4,000 hectares of land along existing rail corridors and transit lines. 4,000 hectares. That's a lot of potential housing. But here's the key insight. Instead of selling this land and generating a one-time windfall for government coffers, you should be leasing it. Keep it in public ownership. Lease it to developers at reasonable rates.

but require them to meet affordability and energy efficiency standards. This way, we can keep housing affordable long-term instead of just cashing in once. The new Build Canada Homes Agency, which just launched in September, is taking this approach. They're planning to bundle multiple federal and provincial sites into these huge 2,000 to 5,000 unit packages.

Instead of developers having to deal with dozens of different municipalities and approval processes, they can work on these large-scale projects that attract the kind of off-site manufacturers who can deliver factory-built homes at 20 to 25 % cost savings compared to traditional construction. And speaking of construction innovation, let me tell you about modular housing, because this is where things get really exciting.

Modular construction can deliver homes 30 to 50 % faster than traditional building methods. There are companies like Caven that are building five to seven unique homes daily in factory settings. Vancouver successfully deployed 663 modular units for supportive housing, proving this approach works at scale. The advantages are huge. You can build year round, unaffected by weather.

You get controlled quality in factory settings. You need fewer skilled workers on site, and you get lower costs through economies of scale. Toronto committed to building 1,000 new modular homes through their Modular Housing Initiative, with 216 already completed. But honestly, this should be happening nationwide with federal support for manufacturing capacity. Now, let me talk about workforce.

because we have a massive labor shortage that's driving up housing costs. Right now, labor shortages are adding about $28,000 to the average new home price in Ontario alone. 28,000. That's not a small factor. That's a huge chunk of what's making housing unaffordable. So what do we do? First, we need to fast-track skilled trades immigration.

I'm talking about adding 20,000 annual immigration spots specifically for red seal carpenters, electricians, plumbers, the people who actually build houses, and tie those work permits to accredited employers so we don't lose these folks to other sectors. Second, we need a national apprenticeship surge. Fund 50,000 additional apprenticeship seats annually with completion bonuses for underrepresented groups. Because right now,

We're not training nearly enough people to meet the demand for housing construction. Third, we need tax credits for advanced manufacturing facilities that can produce net zero ready wall and floor assemblies. Right now, Canada's modular housing plants are producing maybe 10,000 units per year. If we can scale that to 100,000 units per year, we're talking about cutting per unit labor hours by 40 to 50%. But you know what?

Even with all these supply-side solutions, we can't ignore affordability. Because what good does it do to build more housing if regular families still can't afford it? This is where social housing comes in. And let me tell you, Canada is way behind the rest of the developed world on this front. European countries maintain 20 to 30 % social housing. The Netherlands has 30%. Austria has 24%.

Denmark has 20%. These are some of the most livable cities in the world, and they achieve that through strong public housing sectors. Canada? We struggle to reach 5 % social housing. 5%. It's embarrassing, honestly. The National Housing Accord is calling for 2 million new purpose-built rental units by 2030. 2 million. And I think we can do it by providing 50-year, 1 % mortgages through CMHC.

to nonprofit and co-op providers, but requiring that 30 % of those units rent for 80 % or less of median market rent. We also need to capture some of those land value gains that happen when we up zone neighborhoods or build new transit. A modest transit oriented development charge, say $15 per additional buildable square foot, could raise billions within major metros that goes right back into affordable housing funds. Now,

Let me talk about some creative solutions that don't require building new structures. CMHC estimates we could add up to one million basement or garden suites in the next decade if all provinces adopt Ontario-style province-wide permissions for secondary suites. One million units. And most of the infrastructure is already there. The water, the sewer, the electrical connections. Similarly,

Those empty office buildings from the 1980s and 1990s that are sitting vacant in downtown cores? They're actually ideal candidates for residential conversion. Provide GST rebates on conversion costs plus accelerated depreciation, and suddenly these projects become financially viable. But here's something really important we need to talk about, climate change. Because everything we build needs to be climate smart and resilient. That means net zero ready building codes by 2030.

paired with bulk purchase programs for heat pumps and triple pane windows so we don't spike construction costs. It also means designing for heat resilience, especially in southern Ontario and BC's Fraser Valley, where climate models show that days over 35 degrees Celsius are going to triple by 2050. Now, you might be wondering, and this is probably what you're thinking right now, is this all just wishful thinking, or can we actually make the numbers work? Well,

I've been running some calculations and here's what it looks like if we implement everything I've talked about over the next decade. Missing middle up zoning could add about 1.3 million units at an average cost of around $420,000 each. That's mostly private investment, $546 billion in economic activity. Public land developments could add another 600,000 units at around 350,000 each.

That's 210 billion in public-private investment. Secondary suites could add a million units at about 120,000 each for retrofits and approvals, another 120 billion. And conversions plus modular infill could add 400,000 units at around 280,000 each. That's 112 billion. Add it all up, and we're looking at 3.3 million new homes over the next decade.

with a total investment of just under $1 trillion. Now, I know that sounds like a lot, but here's the thing. About 70 % of that would be private capital, 20 % federal low-cost loans, and only 10 % direct grants for deep affordability programs. And here's the really exciting part. 3.3 million new homes actually exceeds the 2.3 million additional homes that the Parliamentary Budget Office says we need by 2030.

so we'd actually have a buffer against future demand. But none of this happens automatically. We need what I like to call federal provincial housing delivery compacts, annual targets for starts, completions, and affordability benchmarks that are publicly reported with real consequences for missed targets. And we need data transparency. Statistics Canada's Housing Supply Toolkit should include real-time building permit dashboards

so market participants can see pipeline shortages early instead of always being reactive. Look, I know this all sounds overwhelming, and honestly, it is a lot. But here's what gives me hope. Every single thing I've talked about today is technically feasible with current technology and current governance structures. We don't need to invent new construction methods or create new levels of government. We just need the political will to do it. And more importantly,

We don't need to do the impossible. We don't need to build cities in the Arctic or blast foundations through the Canadian Shield. We just need to be smarter about using the land where people already live and work. Canada's habitable areas already have the infrastructure, the labor markets, and the climate conditions to house our growing population. By densifying existing cities, unlocking public land, modernizing construction, and embedding affordability protections throughout the process,

we can add more than three million homes within a decade. The solution to Canada's housing crisis isn't some far-off technological breakthrough or massive new government program. It's right here, in the decisions we make about how to use our existing communities more efficiently and inclusively. Cities like Edmonton and Vancouver are showing that bold zoning reform works. Modular housing companies are proving that factory-built homes can be delivered faster and cheaper.

The Housing Accelerator Fund is demonstrating that federal incentives can drive municipal action when they're structured properly. What we need now is to scale these solutions nationwide and coordinate them with workforce development, public land utilization, and strong affordability protections. The housing crisis emerged from decades of policy choices that prioritized homeowner wealth over housing accessibility. Fixing it requires reversing those choices through coordinated action

that puts housing supply, affordability, and inclusion ahead of the narrow interests of existing property owners. The alternative to bold action is continued deterioration of housing accessibility, economic competitiveness, and social cohesion. Canada can build its way out of this crisis, but only through systematic reform of the policies that created it. And you know what? I'm optimistic, because when I look at cities like Edmonton eliminating single-famil zoning,

When I see Vancouver allowing eight units on former single-family lots. When I hear about the Build Canada Homes Agency planning to build at scale. These aren't just policy announcements. These are fundamental shifts in how we think about housing and cities. The tools exist. The successful models are proven. The need is urgent. What's required now is leadership committed to transformative change rather than preservation of an unsustainable status quo.

So that's where we stand, folks. Canada's housing crisis is solvable, but it requires us to think differently about zoning, about public land, about construction methods, and about what kind of communities we want to build for the next generation. That's all for today's episode of Canada's Housing Crisis Podcast. I'm Alia, and if this episode got you thinking, or if you want to push back on anything I said, I'd love to hear from you. Drop me a line at hello at micme.com.

That's micme.com if you want to get involved and ask questions. We'll answer them live on the podcast. And make sure to subscribe wherever you listen to podcasts so you never miss out on learning about Canada's housing crisis. Next week, we're diving into something that's been on my mind a lot lately, the role of immigration in our housing shortage. It's a topic that gets people heated. But I think there's a more nuanced story here than what you usually hear in the headlines.

Until then, keep questioning those housing policies. Keep pushing for better solutions. And remember, the path out of this crisis runs right through the communities where we already live. We just need to use them better. Talk to you next week.