Sunday Dock Read: Ready for Q4 & 4 Plex Squabbling You Can’t Miss

Well, the time has come and gone again. That is the exercise of closing up our cottage for the year. This was a special year as we did a little building, most of the little ones joined in for a cottage classic – Kick the Can and of course many innings were played in everyone’s favorite pastime ‘Beach Baseball’.

As bittersweet as its there is something enthusiastic and inspiring about about Q4. There’s a business buzz in the air. Entrepreneurs and Business owner squeeze every last second out of their day, full of dedication to what they worked so hard for over the past 10 months.

Canadian Thanksgiving is a perfect reset to the lull of fall and appreciate how much family means to all of us. Sure, it’s hectic and no one knows who was supposed to bring the turnip (side note: my brother was). And after the political and religion debates subside you can’t help but be thankful for life, family, and health.

However, enough of the mushy stuff, let’s get to work as we enter Q4!

It’s been a few months since my last blog as I’ve been assigned various cottage construction duties each weekend for the past 3 months. It was so much fun. I swear I love parging and insulating!

But back to our daily market and economy watch, specifically inflation. Now it’s important that many understand that inflation is calculated directly from a persistent rise over time in the average price of goods. These include food, transportation, shelter, furniture, clothing, recreation, etc.

However due to a little herd mentality and inflation statistics being released 2 months after the data has been collected, some of the fear may not be warranted.

A Bank of Canada survey found that Canadians often think inflation is higher than it actually is, and they expect it to stay high. This misunderstanding is mainly due to the prices they see in stores and their personal shopping experiences. Those who see a big gap between what they think, and the actual inflation rate anticipate significant price increases for essential items like food and housing.

The survey, conducted in August 2023, shows that high inflation expectations among consumers are linked to their views on factors like government policies, business practices, and labor shortages. Some consumers blame banks and the government for making life more expensive by taxing items like gasoline, contributing to inflation.

Additionally, the survey reveals that many consumers believe that raising interest rates is causing high inflation. The central bank has been increasing interest rates since early 2022 to control inflation, aiming for a two percent target rate. However, not all consumers understand that higher interest rates are meant to reduce inflation, and some believe they will continue to rise in the coming year, partly because they can see the impact of higher interest rates on expenses like mortgage payments.

The cost of living in Canada is the top concern for consumers, with inflation and high interest rates negatively affecting most households. Many believe that the effects of higher interest rates on their spending are not over, leading to reduced planning for major purchases.

Consequently, many consumers are more inclined to spend on discretionary items like vacations and concerts rather than making big-ticket purchases typically financed with loans.

Consumer sentiment has been negatively impacted by recent interest rate hikes and higher-than-usual inflation. A significant portion of respondents (55 percent) expects a recession in the coming year, as they typically associate high interest rates and inflation with a higher likelihood of an economic downturn. However, long-term inflation expectations remain low and steady, with many consumers foreseeing deflation in the future, thinking that the recent high price increases will eventually reverse.

Since our last blog other topics has reached the top on many municipality’s agenda. That is the proposal that permits fourplexes in certain communities. I think we can all agree Canada and specifically has a housing supply issue. While this seems like an immediate fix, I’m interested to see a full planned subdivision of just fourplexes and additionally how that community interacts with each other.

Let’s dive in some of the communities’ making headlines on this specific issues.

Mississauga city council decides against fourplexes (Mayor Bonnie Combie)

Mississauga city council voted against a proposal to permit fourplexes across the city. Instead, they decided to have their staff explore the feasibility of the idea and report back.

In a tied vote, the council rejected the motion, which aimed to address housing availability in the “missing middle.” The proposal called for allowing four residential units “as of right” in Mississauga. This move comes as Mississauga faces pressure from the federal government to increase housing density, particularly through the construction of fourplexes, in exchange for additional housing funds.

Ward 5 Coun. Carolyn Parrish argued that the council missed the point of the motion, which was to show support for residents and secure extra funding for infrastructure. She expressed concern that the city’s signal had been lost due to the decision.

Mississauga Councillor Alvin Tedjo, who proposed the motion, considered the vote a setback but remained committed to addressing the housing affordability crisis by changing zoning bylaws. He emphasized the need to build more homes around transit and in the downtown area.

Ward 7 Coun. Dipika Damerla, who did not support Tedjo’s motion, favored another proposal that asked city staff to study the feasibility of fourplexes in consultation with the city’s housing panel and after conducting a public meeting. This alternative motion passed unanimously.

Mississauga Mayor Bonnie Crombie expressed her support for fourplexes as part of the solution to Ontario’s housing crisis. She emphasized the importance of innovative approaches to addressing housing issues and securing funding. Crombie was encouraged by the motion for a staff report on the matter and was dedicated to pushing for a motion allowing fourplexes at the city council.

Canada’s housing minister, Sean Fraser, expressed disappointment with the council’s vote and found it concerning. In a letter to Crombie, he stated that the city needed to take certain steps to address the housing crisis for their application to be approved. Among these steps were permitting four-unit housing throughout the city and allowing four-storey buildings within 800 meters of transit lines. Fraser stressed the importance of ensuring that Mississauga was doing everything in its power to address the national housing crisis before approving their application.

Guelph Mayor Bullish on Fourplexes

Guelph mayor Cam Guthrie has taken steps to address the housing crisis in the city, hoping to alleviate the situation through a motion passed at a special council meeting on Tuesday.

This motion, approved unanimously, sets in motion the process of drafting a zoning bylaw amendment that would permit up to four residential units, or fourplexes, on a single lot as a matter of right.

Guthrie initially introduced this motion in May without a predefined limit on the number of units per lot.

“I actually brought a motion forward to consider more than three,” Guthrie stated. “It didn’t limit it to four. It could have been five, six, seven, or eight.”

He also indicated that there would be a future motion to increase the limit beyond four units, expected to be brought up in the coming months. In the meantime, the draft bylaw is slated to be presented in 2024.

Guelph’s decision to explore fourplexes aligns with the City of Kitchener, which recently approved a similar motion. Kitchener’s draft bylaw will also be subject to a vote in 2024.

While Guelph and Kitchener have embraced the idea of fourplexes, other municipalities in Ontario have resisted such changes. For instance, Mississauga rejected a motion to allow fourplexes near transit stops.

Mayor Guthrie believes that enabling fourplexes should be an obvious choice in rapidly growing cities.

“What we are seeing now, even since May to today, the housing crisis has gotten even worse,” Guthrie noted. “Because of the housing crisis, I think we have to pull out all options and tools to ensure we explore every avenue available to us.”

The special council meeting centered on housing in Guelph, addressing various measures and responses to the housing challenge. This included considering housing as a human right, utilizing the federal Housing Accelerator Fund as an incentive for building new residential units, and more.

Now both have excellent points and rationale however when digging deeper into the Guelph situation I am quite positive that there are private landowners that have ready to build land but choose not to as revenue is not an ambition these days.

Additionally, lest not forget the GID land on the east side which consist over 100 acres. I realize that development like these take a massive amount of time. I’ve done them myself with my own company.

However just to remind everyone Fusion Homes acquired the land in December 2021 for a reported $72.2 million. The expansive site is situated along Stone Road East, Victoria Road South, and the Eramosa River, encompassing 100 acres of protected natural landscapes.

Ryan Scott, Fusion Homes’ Senior Vice President of Development and Finance, expressed their enthusiasm for this opportunity as the company’s headquarters are located in the area. The vision for the development includes a harmonious blend of residential, commercial, retail spaces, employment opportunities, and an emphasis on sustainability, affordable housing, mobility, pedestrianization, open spaces, parks, and walkability.

Sasaki, a U.S.-based design firm with offices in multiple cities, has partnered with Fusion Homes for this innovative project. Fusion Homes, founded by CEO Lee Piccoli in 1999, has a substantial track record of constructing thousands of homes in Guelph, Kitchener, Waterloo, London, and their surrounding regions.

The Guelph Innovation District (GID) aims to establish a sustainable mixed-use community that not only addresses housing supply concerns but also generates numerous jobs. This project marks the first of its magnitude for Fusion Homes.

While the precise figures are still being determined, Scott indicated a preliminary plan for approximately 5,000 new units, accommodating 9,000 to 10,000 new residents, and generating “thousands of jobs.” Fusion Homes’ goal is to break ground in 2025 and complete the initial phase of homes and structures by 2027, with additional development phases extending into subsequent years.

Fusion Homes is in the process of initiating stakeholder focus groups, which includes collaboration with the University of Guelph, the city’s chamber of commerce, and other key parties.

The partnership with Sasaki will strongly emphasize the community’s sustainability. Scott emphasized the flexibility in construction, such as the possibility of an 18-storey apartment building or a 12-storey mass timber condo. Additionally, the project explores geothermal and district energy heating systems, optimal building positioning for seasonal climate adaptation, and increased tree coverage. While no specific green standard has been confirmed yet, plans include accommodating expanded allowances for electric vehicle charging.

The project also prioritizes the preservation and enhancement of natural heritage areas. The goal is to collaborate with experts in this field to maximize existing and new trail networks for improved mobility and reduced car reliance.

Job creation in the Guelph Innovation District will focus on five key sectors: agri-innovation, cleantech, information technology, advanced manufacturing, and life sciences. The proximity to the University of Guelph is seen as an opportunity to establish an information hub and bring these job sectors to fruition.

The challenge facing Fusion Homes is to make the community relevant and adaptable for the year 2050. Given the evolving nature of the GID, ensuring adaptable infrastructure, especially concerning heating and cooling, is crucial. The development phases may witness changes in technology and design as advancements occur over time.

-Mathew Monks
Huron Development Consulting – Planning, OP, Zoning, Project Management
Huron Mortgages – Commercial, Residential, Land, Construction, 2nd Mortgages, First Time Home Buyers
519.497.3667 – Love to listen to your thoughts or texts about real estate and mortgages.