Inclusionary Housing Canada

The two terms are often used interchangeably to mean the same thing. In this website, the two are used in a more particular and careful way in order to make an important distinction.

‘Inclusionary zoning’ is used only in reference to the particular set of inclusionary housing practices and policies seen in the US. Put another way, it might be described as “American-style” inclusionary housing. Although all of the programs there vary in many details, they all fall within the same and recognizable model. (That model is described elsewhere on this website.)

‘Inclusionary housing’ is used more generally in reference to a variety of practices and policies directed at creating mixed-income projects through the development regulations and approval process.

There are two notable and effective examples of inclusionary housing. One is the afore-mentioned inclusionary zoning as practised in the US. The other is the ‘planning gain’ approach used across England – which could be called “English-style” inclusionary housing .

In this country, three major cities – Montreal, Toronto and Vancouver – also have adopted inclusionary housing policies. These share many features, and might be the basis for an emerging “Canadian-style” inclusionary housing approach.

Here is the important distinction that must be made. It is inappropriate to call any of these Canadian programs as ‘inclusionary zoning’. They use a set of practices that are distinctly different than those in the US and, as a consequence, are more limited in the affordable housing that they produce.

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Affordable housing, by its very purpose, is intended for households not able to afford market housing.  So, these programs typically set maximum income limits (adjusted for the size of the household) for the occupants of the units.  Also, it is fundamental that the size of the household must match the size of the unit.  (Large households are not allowed to squeeze into small units, nor small households take advantage of large units.)

In the case of affordable ownership units, some programs add other eligibility criteria.  For example, they might limit the purchase to first-time buyers, or households who have not owned a home for a number of years.   They might also put limits on assets that the purchasers can have, in order to weed out those capable of buying a market unit.

Where there is a big demand for these units (as there generally is), the municipalities select the potential occupants from the pool of eligible candidates using either a lottery or a  “first-come/first-served” process.

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The programs most typically are designed to take as affordable housing some portion of the units being built as market housing.  As a result, the affordable units typically are the same as the market units in size (number of bedrooms and square footage) and tenure.  This housing is then provided at a price or rent substantially below market price for the equivalent market units.

So, if the market-rate units are provided as ownership units, then the affordable units typically will be as well.  And, if the market-rate units are small (or large) units, then the affordable units will be as well in more or less the same mix of sizes and types.

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