Expectations and Applications

How do expectations affect economic decisions? The recent “inclusionary zoning” imbroglio at Toronto City Hall offers an interesting case study.

On October 22, 2021, the City’s Planning and Housing Committee approved the Inclusionary Zoning amendments, which would go up to vote in City Council on November 9th.

This news was seen as a surprise to many developers, as evidenced by the flurry of activity in the three weeks leading up to the November 9 City Council meeting. Dozens of new Condominium Approvals were being submitted per week; a huge increase, as the trend had been for only a handful of these applications per week.

The new rules go into effect in September 2022. This date must also have been a surprise to developers, because the day after the vote there was an immediate drop in the number of new Condo Approval applications being submitted per week.

As part of my work with UrbanToronto.ca, I have access to all the city planning and permitting data as they come in. This lets me chart and quantify this surprise. (If you’re interested in getting a summary of this data sent to your inbox daily, check out the New Development Insider. This report was first published there!)

Before delving into the charts, a bit of background info:

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Three Short Stories on Housing Economics

Originally published on Notes on Liberty.

Do you love housing economics but have struggled to get the basic ideas across the younger generation? Yes, you get excited about reading 60-page reports, but kids these days have better things to do.

That’s why I wrote these three, action-packed, short stories which you can read to any child (or child at heart).

So without further ado, here are three stories about how the supply of housing affects the prices of housing.

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Rethinking the Yellowbelt: Report Release

After a full year of research, the largest, most comprehensive report on the economics, politics, history, and policies of zoning in Toronto is available for download.

The full report is available both on the Housing Matters website, and quickly downloadable here: Rethinking the Yellowbelt.

The “Yellowbelt” refers to the portion of the city that’s zoned exclusively for detached homes. The report goes into detail explaining when and why such a zone came into existence, where it spreads in the city, who is hurt by the existence of this zone and how; and what it will take to change the system.

A summary of the report follows. Of course, the report itself goes into much more detail.

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