Excessive paperwork exacerbating Canada’s housing shortage: CFIB

Municipal governments can help address the housing shortage in Canada by simplifying their permitting processes, according to a report released as part of the Canadian Federation of Independent Business's (CFIB) 15th annual Red Tape Awareness Week.

A report released as part of the Canadian Federation of Independent Business’s (CFIB) 15th annual Red Tape Awareness Week entitled Flushing out the nonsense says the Municipal governments can help address the shortage of housing in Canada by simplifying their permitting processes.

“Canada’s housing shortage has come to the point where buying a home in Canada is getting out of reach for most Canadians. This also makes it more challenging for small employers who struggle to attract employees in many cities across the country, as those employees cannot find affordable housing. Municipalities across Canada can do more to help address it,” said Duncan Robertson, senior policy analyst at CFIB and co-author of the report. “Making municipal permitting processes simpler and less costly is one important step in addressing Canada’s housing challenges.”

The report analyzed what type of permits and costs are needed for a $20,000 project to convert a simple powder room into a full bathroom in 12 major cities across the country.

According to the report, out of 12 municipalities examined, Vancouver had the highest permitting costs and had the highest document requirements along with Toronto.

Additonally, they are the cities with the highest home prices and greatest shortages. On average, seven additional documents are required for a bathroom renovation project, with combined permitting costs ranging from $180 in Charlottetown to $2,029 in Vancouver, according to the report.

“If there are this many obstacles for a simple bathroom renovation, imagine how costly and time-consuming it is to permit a secondary suite, a complete renovation or a new build. Permitting costs and processes should be straightforward and affordable,” said Francesca Basta, CFIB’s research analyst and co-author of the report.

The report noted that more than half of small business owners in the construction sector find it difficult to obtain or renew permits and/or licenses. A strong majority of businesses (80 per cent) also agree that governments of all levels should make it a high priority to review the necessity of all business permits and licenses, according to the report.

To cut unnecessary red tape, CFIB recommends municipalities review their existing permitting and approval processes, establish publicly available service standards for permit processing and simplify and even automate certain processes.

Provincial and federal governments should also do their part to address red tape in the housing market by tying future funding for housing and infrastructure to requirements for a low administrative burden, ensuring reporting requirements are set provincially where permit processing service standards are provincial too and championing best practices.

The CFIB is challenging every government in Canada to undertake two red tape reduction initiatives this year to help address the shortage of housing. For example, governments could look at addressing service standards, approval timelines or the burden of permit applications. The impact of these initiatives should be measured and reported in terms of time and/or money saved, according to the CFIB.

“Addressing Canada’s housing challenge is a big job, but there’s one simple, low-cost solution all levels of governments could capitalize on, and that’s reducing red tape,” said Robertson.

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