Converting Commercial Property to Solve the Housing Shortage
A few weeks ago, the Ontario Real Estate Association (OREA) published the results of a public poll with the headline, “Nearly Half of Prospective Home Buyers Under 45 Have Considered or Are Considering Moving Out of Ontario Due to Housing Affordability.” As a real estate agent working in Southwestern Ontario, I was intrigued by this dramatic statement that could affect my business directly—in other words, the headline successfully caught my attention.
The poll validates problems realtors and home buyers already know—housing availability and affordability in the province is getting worse. Then OREA moved towards asking about solutions rather than only collecting complaints. A majority of poll participants supported the following solutions the Ontario government could undertake to make the housing market more affordable:
Introduce tax credits and incentives for homeowners to make improvements in their homes or improve energy efficiency
Make it easier for first-time home buyers to get into the market by increasing first-time home buyer tax rebates
Redevelop surplus commercial properties into housing
Allow renters to purchase equity in the property they are living in as a way to get their foot in the door towards home ownership
Create more housing choice through minimum zoning requirements in urban areas that are currently zoned for single-family homes
Stop money laundering in the Ontario real estate market with a publicly searchable registry of who owns the properties
I found redeveloping commercial properties into affordable housing the most interesting solution for first-time buyers. Housing is expensive because we have no inventory. We need more inventory to meet buyer demand and control prices. If we can take commercial property that is currently vacant, rezone it, and rent or sell the units, it solves many problems:
It increases inventory.
It reduces, or at least stabilizes, housing prices.
It helps protect the environment.
It provides the commercial-property owners with sales revenue from first-time buyers or rental income from rentersBonus solution: The property can repurposed as low-income housing, which is another problem Guelph has on its hands.
The first milestone toward this solution is to rezone commercial property into residential. This is not a new concept in Guelph; it’s been done with older, historic buildings or warehouses that were rezoned and built as apartments, such as The Mill Lofts (26 Ontario Street), The Raymond Sewing Machine Factory (86 Yarmouth St), and Oxford Manor (135 Oxford St). Why can’t the same process be used for newer commercial properties? All it takes is some planning and designs for a proposal followed by cooperation from the City of Guelph to assist in the rezoning. Then the building owners can renovate, redesign, and repurpose for renters or buyers while reusing existing land and infrastructure. Sounds like a win-win to me.