Real Estate

GTA Development Charges

  • Last Updated:
  • Sep 25th, 2018 10:54 am
Sr. Member
Jul 4, 2018
526 posts
468 upvotes

GTA Development Charges

http://www.bildgta.ca/Assets/Bild/Educa ... Report.pdf

Average development charge for each unit is approximately 20% of its price

Condo unit starts from 122,000 and low rise from 187,000 to 232,000

Is this charge just for govt to allow construction?
Is this apart from land cost (bought by landlord or developer) ?
I guess this is one of primary reason why developers are charging that hefty sum
If avg construction cost is $200 per sft
For a 500 sft condo... it costs 230,000 to build Before land cost, then land cost then builder profit..
9 replies
Deal Addict
Jun 19, 2009
1107 posts
258 upvotes
Toronto
Well the PDF you linked mentions what the developer charges are for:
The Development Charges Act grants authority to municipalities to enact a
development charges by‐law to impose a charge against land to be developed
where the development will increase the need for municipal services, thus
offsetting capital costs.
Municipal development charges collect funds for services deemed as being
eligible in the Development Charges Act, such as Parks & Recreation, Libraries,
Fire Services, Police Services, Water, Sewer, Roads, Transit, etc. Where there
is both an upper‐tier and lower‐tier municipality, the services included in
each respective development charge are based on which tier is the provider
of each service.
While taxes can help pay for ongoing maintenance and municipal servant salaries, the initial capital investment needed to establish the services to construct the necessary infrastructure comes from the development charges from the initial purchases.
Participant in:
Koodo Mobile - $25/month with 30GB LTE for 24 months (with $5 24 month credit).
Microsoft Price Error - ASUS TUF FX505DT-UB52
40" 4K Samsung TV Monitor User - DM to Ask me anything.
Banned
Mar 13, 2018
1385 posts
679 upvotes
Lavaris1 wrote: http://www.bildgta.ca/Assets/Bild/Educa ... Report.pdf

Average development charge for each unit is approximately 20% of its price

Condo unit starts from 122,000 and low rise from 187,000 to 232,000

Is this charge just for govt to allow construction?
Is this apart from land cost (bought by landlord or developer) ?
I guess this is one of primary reason why developers are charging that hefty sum
If avg construction cost is $200 per sft
For a 500 sft condo... it costs 230,000 to build Before land cost, then land cost then builder profit..
You do know BILD is just a developers group right? Basically they are the lobby group for developers

If you want to learn about DCs, go read the consultants who actually prepare the background studies and if BILD had any legitimate reason to oppose it, they would've done so already in court but didn't

All DC background studies are available online such as Vaughans below

https://www.vaughan.ca/services/busines ... NX5DJQ70FN
Deal Addict
User avatar
Jul 8, 2010
1459 posts
1176 upvotes
Ontario
If someone spent time reading the actual document, will see the actual discrepancies ... How convenient that all buyers put down only 15%, so they can add additional insurance from CMHC.... That is added also for houses above 1 million...
Deal Expert
Feb 22, 2011
16505 posts
21845 upvotes
Toronto
Lavaris1 wrote: http://www.bildgta.ca/Assets/Bild/Educa ... Report.pdf

Average development charge for each unit is approximately 20% of its price

Condo unit starts from 122,000 and low rise from 187,000 to 232,000

Is this charge just for govt to allow construction?
Is this apart from land cost (bought by landlord or developer) ?
I guess this is one of primary reason why developers are charging that hefty sum
If avg construction cost is $200 per sft
For a 500 sft condo... it costs 230,000 to build Before land cost, then land cost then builder profit..
The crazy thing is not that long ago you could buy condos for under $100k. Now the development costs to the city are more than that. And people wonder why the city is expensive. It's all the hidden taxes.

Government wants to increase spending initiatives without increasing income or property taxes which are taboo so they get the money elsewhere. You can cheer all the free stuff you get from the government but don't start wondering why everything costs a lot and why you can't afford rent. Thank god NDP lost or the cost of everything in the cist would have doubled as they increased fees and taxes on everything to fund their insane spending initiatives.
Banned
Mar 13, 2018
1385 posts
679 upvotes
rjg4235 wrote: The crazy thing is not that long ago you could buy condos for under $100k. Now the development costs to the city are more than that. And people wonder why the city is expensive. It's all the hidden taxes.

Government wants to increase spending initiatives without increasing income or property taxes which are taboo so they get the money elsewhere. You can cheer all the free stuff you get from the government but don't start wondering why everything costs a lot and why you can't afford rent. Thank god NDP lost or the cost of everything in the cist would have doubled as they increased fees and taxes on everything to fund their insane spending initiatives.
But development charges only pay for infrastructure to serve the new development and doesn't fund any programs or service delivery

So your rant makes no sense. Maybe you should actually read what DCs cover first?

When condos could be had for 100k (in suburbs in early 2000s), land prices were around 300k per acre for those lands , those same land prices are now 15million per acre ..ever thought about that?
Deal Expert
Feb 22, 2011
16505 posts
21845 upvotes
Toronto
Gboard2 wrote: But development charges only pay for infrastructure to serve the new development and doesn't fund any programs or service delivery

So your rant makes no sense. Maybe you should actually read what DCs cover first?

When condos could be had for 100k (in suburbs in early 2000s), land prices were around 300k per acre for those lands , those same land prices are now 15million per acre ..ever thought about that?
That sounds nice but it is complete BS. A lot of these condos are going up in established areas and based on the amount of units being added in 1 area they absolutely are not spending it on new development in the area.

Don't believe for a second municipalities and governments don't use revenue intended for one purpose as a slush fund for another.
Banned
Mar 13, 2018
1385 posts
679 upvotes
rjg4235 wrote: That sounds nice but it is complete BS. A lot of these condos are going up in established areas and based on the amount of units being added in 1 area they absolutely are not spending it on new development in the area.

Don't believe for a second municipalities and governments don't use revenue intended for one purpose as a slush fund for another.
Lol

Adding even one building will require infrastructure upgrades for the servicing district. Also, if additional growth was including the OP and corresponding MESP and thus included in the DC charges, municipalities would've upsized infrastructure in the area during replacement and added future ones in their rolling 10 year and 25 year infrastructure plans

No DC funds can't be used in general revenue, it's a separate audited account and absolutely transparent for developers to review .

Again, I've posted a sample DC, have you even looked at it? So far you've just made absolutely wrong baseless absurd accusations
Deal Expert
Feb 22, 2011
16505 posts
21845 upvotes
Toronto
Gboard2 wrote: Lol

Adding even one building will require infrastructure upgrades for the servicing district. Also, if additional growth was including the OP and corresponding MESP and thus included in the DC charges, municipalities would've upsized infrastructure in the area during replacement and added future ones in their rolling 10 year and 25 year infrastructure plans

No DC funds can't be used in general revenue, it's a separate audited account and absolutely transparent for developers to review .

Again, I've posted a sample DC, have you even looked at it? So far you've just made absolutely wrong baseless absurd accusations
Your link doesn't work for starters. So then why are these fees up 90% in 5 years? Are they suddenly that much more expensive? Even in areas with largely existing infrastructure? They aren't building roads here or running entire new systems, they are adding on.
Banned
Mar 13, 2018
1385 posts
679 upvotes
rjg4235 wrote: Your link doesn't work for starters. So then why are these fees up 90% in 5 years? Are they suddenly that much more expensive? Even in areas with largely existing infrastructure? They aren't building roads here or running entire new systems, they are adding on.
Apologies for the link, try this

https://www.vaughan.ca/services/busines ... 5Apr18.pdf

And yes up substantially because of the 25000+ population increase in VMC along with the employment area, all the infrastructure needs to be constructed and to a size that will accomodate build out population targets. VMC requires over 400m for engineering capital for the proposed growth. City wide is 2 billion over next 10 years to accomodate new growth.

What existing infrastructure are you talking about? There are no infrastructure currently to handle 25k plus population in vmc. Stormwater, sanitary, road capacity are for current state (as in low density industrial), and not for 25k people. Black Creek rehabilitation is required, road widening and the viva BRT , servicing capacity for sewage treatment down in duffins Creek, a whole new water servicing master plan with upgrade to pressure districts, pumping stations etc all need to be built. DCs go into separate audited account and can only go into items included in the background study that developers review and agree too and who also have ability to appeal it if they wanted. But they're not stupid, they know they need infrastructure to build .

You think the existing pipes and infrastructure don't need to be upgraded to handle all the additional units and population? The home/condos have to connect into bigger pipes that goto bigger facilities to handle it all. Also, municipality is not going to pay on their own to build infrastructure for 25k people upfront when buildout takes years, so there's agreements in place for huge letters of credit or upfront agreement for developers to pay for it and then recoup it via cost sharing agreements when permits are pulled from future units upto the target.


They aren't building roads? Ever driven by VMC? Road widening, intersection improvements , BRT, new flyover for Portage Ave realignment

You think the existing roads used historically for the Ikea, and commerical doesn't need to be upgraded to accomodate 25k residents? It all needs it. This is same for low density in blocks 27 and 41 as well.

Google Vaughan NE water and wastewater servicing class EA to see what's needed for the new low density homes to educate on just water servicing required

Top