The high cost and the time it takes to get municipal permits for residential projects are contributing to Canada’s housing crisis, according to a report on city hall red tape by the Canadian Federation of Independent Business.
The report, released Monday, compared the cost of permits and the amount of paperwork required in 12 cities on a $20,000 job to convert a powder room into a full bathroom. The sample project included moving a non-load-bearing wall, installing a shower and related electrical and plumbing work.
The most expensive city, by far, was Vancouver at $2,099 for the 11 permits required. Charlottetown was the cheapest with a cost of $180 for five permits. Ottawa came in near the middle of the pack at $317 for the six permits needed. Nationwide, the average cost was $506.25, heavily skewed by the high costs in Vancouver.
The CFIB report, titled Flushing Out the Nonsense, found more than half of the small contractors it surveyed said obtaining or renewing the necessary permits was a “major challenge” for their business.
“If there are that many hurdles for a bathroom conversion, imagine trying to build a secondary suite, something the Canada Mortgage Housing Corporation (CMHC) has previously showcased as being a way for homeowners to help offset housing costs,” the report says.
“Ottawa is in a relatively good position in terms of the amount of documentation required and the cost associated with it,” said Christina Santini, director of national affairs with the Canadian Federation of Independent Business (CFIB). “We did find getting through to someone on the phone was a little complicated, but their emailed response was very prompt.”
But Ottawa could be better at saying how long it typically takes to get the necessary permits, Santini said.
“Ottawa is not very open about its processing times, which could help set expectations,” she said. “That helps with transparency. People know what they’re getting themselves into and can say, ‘OK, this is within the regular processing times,’ or ‘No, something is going wrong with this file.’”
Secondary suites, coach houses and laneway homes are all ways of intensifying neighbourhoods, which is essential for addressing the housing shortage, the report says.
“One of the purposes of this report was to empower individuals to look at how they can maximize the use of their property,” Santini said. “But they’re not going to do that if they face so many delays and costs.”
Simplifying and speeding up the permitting process at city hall was one of the goals in Ottawa’s $150-million application for a share of the $4-billion federal Housing Accelerator fund. Mayor Mark Sutcliffe said last week that the city had reached a deal with the federal government, but no details of the agreement or the amount of funding were released.
Sutcliffe acknowledged the city had been struggling with delays and backlogs in its legal department and was in the process of hiring additional staff to speed up the processing of applications. One homeowner told this newspaper he had been waiting more than five months for approval of a straightforward severance application on a duplex he built near Pinecrest Road. That homeowner, David Pittis, said the city told him he could take his application to an outside law firm to speed up the work, but at a cost to him of $3,000.
In its report, the CFIB recommends that cities review their permitting and approval processes, lower the costs of permits, improve access to the information needed and establish service standards for the city to do the paperwork.
It also recommends the federal and provincial governments tie their funding to the efficiency of municipalities’ permitting processes.
Here is the full list of the number of permits required and the cost for a bathroom conversion in all 12 cities surveyed by the CFIB:
- Vancouver 11 permits, $2,099
- Edmonton 5 permits, $673
- St. John’s 6 permits, $579
- Calgary 5 permits, $439
- Winnipeg 7 permits, $380
- Montreal 7 permits, $353
- Saskatoon 6 permits, $327
- Ottawa 6 permits, $317
- Toronto 10 permits, $296
- Halifax 6 permits, $272
- Moncton 7 permits, $230
- Charlottetown 5 permits, $180
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