Municipal fees are driving up the costs of new home construction in Canada, according to the 2024 Municipal Benchmarking Study from the Canadian Homebuilders Association (CHBA).
The study determined that municipal fees charged on new residential developments increased by an average of $27,500 for a low-rise home since the CHBA’s last study in 2022, raising the new average in Canada for municipal fees to $82,600 – the range encompasses $8,700 to $195,000.
Municipal fees charged on new residential developments went up by an average of $3,000 for a high-rise home since the 2022 study, raising the new average in Canada at the time of the 2024 study to $35,000 – the range encompasses roughly $1,600 to $134,400.
CHBA predicted the 2022-2031 period will become the decade with the fewest homes built per new persons added to the Canadian population since at least 1972. Application submissions have fallen significantly since peaking in 2021, in both Ontario and British Columbia while more affordable markets, such as Alberta, have experienced an increase in application submissions.
“Development charges, delays, and inefficient processes at the municipal level directly impact the price of homes and how many are built,” said CHBA CEO Kevin Lee. “The purpose of this study is to facilitate dialogue with all levels of government, but particularly with municipal governments, on the effects of longer timelines, higher fees, and the level of efficiency of processes on housing affordability and outcomes. This report also offers insight into best practices that municipalities can adopt to help improve their housing affordability and supply. It also points to ways that the provincial and federal governments can continue to drive and support change at the municipal level.”
