Inclusionary Zoning… Who Pays the Cost?
By subsidizing affordable units, the cost of non-affordable units must increase. Developers work off a proven business model that requires a minimum % profit margin to be feasible.
Land is not going to be sold for cheaper prices simply because affordable housing is required, it will realistically increase non-affordable unit sale prices to help subsidize affordable units.
When non-affordable unit prices increase, affordable housing prices also increase, and in turn rents increase, creating a cause/effect relationship that is not sustainable.
Rather than force developers to include affordable units, the city should provide substantial incentives to the developer to provide affordable housing, either by financial or other means.
General city/provincial taxpayers should contribute to this incentive goal, since it is for the betterment and continued viability of their own city/province. In this planner’s opinion, “TRYING” to disrupt a proven and working business model will have unforeseen consequences that in the end, will not likely yield desired holistic effect on the City.
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