Item - 2021.PH24.7

The Planning and Housing Committee:

1.  Requested the Chief Planner and Executive Director, City Planning and the Executive Director, Housing Secretariat as part of the ongoing Official Plan review, to report back to the Planning and Housing Committee in the first quarter of 2022 on existing policies and policy options to:

a. Address overcrowding in rental housing;

b. Create affordable rental housing stock that is 3-bedrooms or greater to accommodate larger families and households; and

c. Address underhousing in Indigenous and racialized individuals as well as women and single-parent led, immigrant and refugee households.

2.  The Planning and Housing Committee request the Chief Planner and Executive Director, City Planning, as part of the ongoing Official Plan review, report back to the Planning and Housing Committee on the following:

a. A jurisdictional scan of other municipalities to understand how issues of overcrowding in rental housing are being addressed, including with equity-seeking populations; and

b. Available data on instances of underhousing and overhousing in Indigenous, and racialized individuals as well as women and single-parent led, immigrant and refugee households in Toronto.

The Manager and Planners, Infrastructure and Development Services, Strategic Initiatives, Policy and Analysis, City Planning gave a presentation on Right-Sizing Housing and Generational Turnover.

This report summarizes the attached bulletin, Right-Sizing Housing and Generational Turnover, which builds on the findings of the previous bulletin, Housing Occupancy Trends 1996-2016. This bulletin constitutes one of several analyses to inform the Municipal Comprehensive Review of the Official Plan with respect to the Provincial Growth Plan for the Greater Golden Horseshoe by estimating how much new housing stock may be needed in the future if recent trends continue.

This bulletin examines housing right-sizing, turnover, and downsizing in Toronto. Right-sizing is a household occupying a dwelling having exactly the number of bedrooms required to suitably house that household based on its size and composition. The suitability standard is derived from the National Occupancy Standard (NOS) of Canada Mortgage and Housing Corporation. Housing turnover occurs when a household vacates its dwelling and a new household moves in. Downsizing is one form of turnover and refers to households headed by persons aged 50 years or more and their transition from being an overhoused household to one in which they are right-sized, or less overhoused. Data from the Census of Population and the National Household Survey of Statistics Canada are the basis of an in-depth analysis of:

- How well Toronto's housing stock is meeting the needs of its occupants for bedrooms;

- Whether the Baby Boomer generation is downsizing more or differently than their predecessors did;

- How much of the future increase in demand for housing is likely to be fulfilled by the existing stock through the downsizing of older generations; and

- Where in the city might the turnover of older generations' housing occur?

In 2016, almost 135,000 Toronto households were underhoused (living in dwellings with an insufficient number of bedrooms), while there were more than three times as many households who were overhoused. This bulletin examines the characteristics of households that are under- or overhoused and the many reasons why this occurs. This analysis reveals that there are many underhoused households with children, particularly in mid/high-rise units, while overhousing tends to increase with the age of household.

As the relatively large Baby Boomer population ages, there is much speculation about when and how much they will downsize, potentially freeing up housing for younger and larger households such as those with children. This research has found that, so far, Baby Boomers have chosen to downsize at a rate similar to the rate of the previous generation. Nevertheless, the aging Baby Boom generation is expected to translate into a larger number of downsizers than in the past because of the large size of the Baby Boom population.

Toronto's population is forecasted to grow significantly in the coming years. The Provincial Policy Statement, the Provincial Growth Plan, and the Official Plan all direct the City to consider existing land, housing, and infrastructure when planning to accommodate population growth. Based on a series of assumptions about trends in demographics, housing supply, and prevailing market conditions­, the bulletin estimates the aging of the generations, how each generation translates into households over time, and how many households there may be of each generation in the future. This in turn enables an estimate of how older generations' housing might turn over and when, and how much of the future demand for housing this turnover might offset.

The bulletin also finds that there are a significant number of existing dwellings occupied by older households and, because these households are at a later point in their lifecycle, the dwellings are not presently occupied to their fullest capacity. The analysis estimates the unused capacity of the existing housing stock occupied by older generation households that could potentially accommodate more population if that stock turned over to younger and larger households over the course of time.

In conclusion, the analysis demonstrates that the existing housing stock has significant potential to accommodate a portion of the future increases in demand for housing. Consequently, the bulletin demonstrates that not all future population growth needs to be accommodated in new housing. The household estimates are based on the demographic conditions as they existed in 2016 and those conditions are extended into the future. Non-demographic factors outside the scope of this analysis are potentially significant. This work is an important input to the Municipal Comprehensive Review of the Official Plan, to bring it into conformity with A Place to Grow and its population forecast to 2051.

Household Estimates and the Scope of this Bulletin

While the household estimates in this bulletin incorporate the same planning horizon as the Growth Plan's forecasts, note that these household estimates are neither forecasts nor projections and have a more limited scope. Forecasts may take into account planning and housing policy changes as well as market forces and business cycles, which are beyond the scope of the household estimates presented here. Projections incorporate changes to demographic rates over time, including trends in fertility, mortality, mobility, housing occupancy and housing completion rates. The household estimates presented here hold all of these rates steady over time to provide a comprehensive snapshot of what the housing demand could be if current conditions continued to 2051. The estimates were designed so that the changing age structure of the population could be isolated from other factors that drive or influence housing demand. These household estimates are a simplified scenario of current conditions extended to 2051 against which to isolate and assess the magnitude of housing turnover over the period.

Note that all scenarios explored in this bulletin are demographic exercises only; considerations of macroeconomics, societal trends and the market are outside the scope of this bulletin. These scenarios do not attempt to predict what households will be able to afford. These scenarios estimate how much housing and the types of housing that future households might demand based on fixed household rates and current demographic conditions continued into the future.