Development Charges Are Quietly Deciding Which Housing Projects Get Built
Every housing supply conversation eventually comes back to the same question: what makes a project pencil. New data from Canada Mortgage and Housing Corporation puts a number on one of the least visible answers, and it is a bigger one than most people assume. Development charges, the fees municipalities levy on new construction to fund roads, sewers, and other infrastructure, can be the difference between a project that gets built and one that quietly dies in a feasibility review.
CMHC chief economist Mathieu Laberge and his team pulled together the first real side by side comparison of development charges across municipalities in Ontario, Alberta, and British Columbia. The findings confirm something developers have argued for years without a common dataset to back it up: fee structures vary enormously by city, and that variation is shaping where housing supply actually lands.
The spread is significant. In Calgary, fees run from roughly $3,860 for a one bedroom high rise unit up to $9,328 for a single family detached home. Move to Vancouver and the range jumps to between $19,657 and $32,613. Toronto is structured differently, charged per bedroom, but a two bedroom or larger unit generates more than $67,000 in fees. Burnaby, according to CMHC, is where the fee burden is heaviest of all, ranging from over $60,000 for apartments to more than $116,000 for single family homes.
For anyone underwriting a project, that is not a rounding error. CMHC’s modelling shows that eliminating development charges entirely could lift project viability by as much as 14 percent in Burnaby, with Toronto and Vancouver seeing viable project counts rise roughly 10 percent. Laberge’s report goes further, noting that removing charges in Toronto alone could theoretically close half of that city’s supply gap. Those are the kinds of figures that reshape a pro forma, and by extension, reshape what gets greenlit.
What makes this data valuable to anyone thinking about land strategy is the comparative angle, not the absolute numbers. Alberta and Quebec already run leaner fee structures than Ontario and British Columbia, and Calgary and Edmonton have both moved to lower development charges in recent years, a decision Laberge credits with a measurable, positive impact on supply. That is a signal worth watching. Jurisdictions willing to treat fee structure as a lever, not a fixed cost, are effectively competing for development capital against jurisdictions that are not.
Development is never just about land. It is about timing, access, infrastructure, policy, demand, and the future identity of a community.
None of this argues for eliminating fees outright, and Laberge is careful to say so. Infrastructure has to be paid for by someone, and the honest position is that the optimal fee level is not zero, it is calibrated. But his analysis points to a more surgical opportunity, particularly around family sized units. Three bedroom and larger new builds in Toronto and Vancouver already carry price premiums over comparable resale homes, largely because per unit fee structures hit larger units hardest. Targeted relief there could do more for the missing middle than a blanket cut ever would.
For developers and municipal planners weighing where the next wave of supply gets built, this dataset is a planning tool as much as a policy debate. Fee structure is now measurable, comparable across markets, and directly tied to project viability. Cities serious about closing their housing gaps have a clear lever in front of them, and the data now shows exactly how much pulling it is worth.
