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Toronto's Housing Shortage Was Written Into Its Zoning Rules
On a land-use map of Toronto, much of the residential city is shaded a pale yellow. Planners call it the yellowbelt, and on those lots the rules have long allowed essentially one kind of building: a detached house. The Toronto Region Board of Trade is now asking the Ontario government to change that, along with parts of the Ontario Building Code that quietly decide what can be built on the land that remains.
What the yellow on the map means
Exclusionary zoning is the planners' term for bylaws that permit only single-family homes in a given area. It doesn't ban apartments outright. It makes them a special request. A builder who wants a fourplex or a small apartment building on a yellowbelt street has to apply for a site-specific amendment, which opens public hearings, appeals and months of carrying costs before a shovel moves.
The Board's proposal is to allow multi-unit housing as-of-right, meaning permitted by default without a separate approval, across all residential zones. The province has the power to do this. Under the Planning Act, Queen's Park can override municipal zoning through Provincial Policy Statements or Minister's Zoning Orders, and it has already pushed municipalities toward allowing several units per residential lot, though each town has implemented that differently.
The scale of the gap explains the urgency. CMHC counted 62,561 housing starts in Ontario in 2025, while the province's target is 1.5 million new homes by 2031. Nationally, CMHC's September 2026 projection puts the need at up to 4.69 million homes by 2036.
The staircase rule behind the missing middle
The second barrier sits in the building code. Ontario generally requires two exit stairwells once a building rises past a small height. On a narrow city lot, a second staircase can consume enough floor area that a modest four-storey apartment building stops making financial sense, so nothing gets built.
That's a big reason the missing middle is missing. Townhomes, walk-ups and small mid-rises are common in many older cities, yet in the Toronto region you mostly see towers or detached houses. Proponents argue that bringing the Ontario code into line with the National Building Code of Canada, and allowing single-stair designs paired with modern sprinklers and fire separation, would cut costs and timelines without giving up safety. Ontario has shown it can update the code this way: it now allows mass-timber buildings up to 18 storeys, according to the City of Toronto.
What reform would and would not fix
You should know the limits plainly. Changing the rules doesn't lower the price of labour, lumber or concrete, and those costs remain a real barrier to affordability. Many established neighbourhoods also run on sewers, water mains and electrical service sized for one family per lot, so density can arrive faster than the pipes can handle it.
Neighbours lose something too. As-of-right approval removes the hearing where a street could object to shadowing or privacy concerns. Those trade-offs are real, and they deserve honest weighing. Still, a major multi-unit project in Toronto can take six to ten years from planning to completion, and a large share of that is process rather than construction.
What this could mean on your own lot
You don't have to be a developer for this debate to touch your plans. Here in Grimsby, as across the Greater Golden Horseshoe, growth is shaped by provincial intensification policy under the Places to Grow Act. If you own a generous lot, the direction of reform points toward options that used to require a fight at council:
adding a basement or garden suite for an aging parent or an adult child
converting a large house into a legal duplex or triplex for rental income
building a multigenerational home designed for shared living from the start
Each of these depends on your municipality's current bylaw, servicing on your street, and the financing behind it, which is where most people's plans actually succeed or stall.
Seeing the rules as the source of the shortage also shows you where the openings are, because rules change and the people who understand them early tend to have the widest choice. If you're weighing what your property could become, or how to fund it, I'm glad to sit down with you, look at what your lot allows today, and map out a realistic first step.
On a land-use map of Toronto, much of the residential city is shaded a pale yellow. Planners call it the yellowbelt, and on those lots the rules have long allowed essentially one kind of building: a detached house. The Toronto Region Board of Trade is now asking the Ontario government to change that, along with parts of the Ontario Building Code that quietly decide what can be built on the land that remains.
What the yellow on the map means
Exclusionary zoning is the planners' term for bylaws that permit only single-family homes in a given area. It doesn't ban apartments outright. It makes them a special request. A builder who wants a fourplex or a small apartment building on a yellowbelt street has to apply for a site-specific amendment, which opens public hearings, appeals and months of carrying costs before a shovel moves.
The Board's proposal is to allow multi-unit housing as-of-right, meaning permitted by default without a separate approval, across all residential zones. The province has the power to do this. Under the Planning Act, Queen's Park can override municipal zoning through Provincial Policy Statements or Minister's Zoning Orders, and it has already pushed municipalities toward allowing several units per residential lot, though each town has implemented that differently.
The scale of the gap explains the urgency. CMHC counted 62,561 housing starts in Ontario in 2025, while the province's target is 1.5 million new homes by 2031. Nationally, CMHC's September 2026 projection puts the need at up to 4.69 million homes by 2036.
The staircase rule behind the missing middle
The second barrier sits in the building code. Ontario generally requires two exit stairwells once a building rises past a small height. On a narrow city lot, a second staircase can consume enough floor area that a modest four-storey apartment building stops making financial sense, so nothing gets built.
That's a big reason the missing middle is missing. Townhomes, walk-ups and small mid-rises are common in many older cities, yet in the Toronto region you mostly see towers or detached houses. Proponents argue that bringing the Ontario code into line with the National Building Code of Canada, and allowing single-stair designs paired with modern sprinklers and fire separation, would cut costs and timelines without giving up safety. Ontario has shown it can update the code this way: it now allows mass-timber buildings up to 18 storeys, according to the City of Toronto.
What reform would and would not fix
You should know the limits plainly. Changing the rules doesn't lower the price of labour, lumber or concrete, and those costs remain a real barrier to affordability. Many established neighbourhoods also run on sewers, water mains and electrical service sized for one family per lot, so density can arrive faster than the pipes can handle it.
Neighbours lose something too. As-of-right approval removes the hearing where a street could object to shadowing or privacy concerns. Those trade-offs are real, and they deserve honest weighing. Still, a major multi-unit project in Toronto can take six to ten years from planning to completion, and a large share of that is process rather than construction.
What this could mean on your own lot
You don't have to be a developer for this debate to touch your plans. Here in Grimsby, as across the Greater Golden Horseshoe, growth is shaped by provincial intensification policy under the Places to Grow Act. If you own a generous lot, the direction of reform points toward options that used to require a fight at council:
Each of these depends on your municipality's current bylaw, servicing on your street, and the financing behind it, which is where most people's plans actually succeed or stall.
Seeing the rules as the source of the shortage also shows you where the openings are, because rules change and the people who understand them early tend to have the widest choice. If you're weighing what your property could become, or how to fund it, I'm glad to sit down with you, look at what your lot allows today, and map out a realistic first step.
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