Sault Ste. Marie considers paying developers to boost local housing supply

Ontario Construction News staff writer

The City of Sault Ste. Marie will try to boost housing supply by providing grants to developers.

Proposed financial incentives are included in a draft Housing Community Improvement Plan (CIP). They include:

  • grants of up to $160,000 for small-scale rental dwellings up to four units
  • grants to reimburse a certain portion of municipal taxes on new dwellings greater than five units
  • feasibility study grants to assess the feasibility of building “missing middle” housing on property that owned by a not-for-profit agency

soo plan housingThe plan includes several programs to encourage investment in housing stock, aiming to meet both current and future housing demands. Any unit that receives a grant from the city will need to remain affordable for 20 years.

Like many municipalities in Canada and Ontario, Sault Ste. Marie faces challenges in providing adequate and affordable housing. This plan focuses on providing higher-value incentives for affordable units.

To be designated affordable, according to the province, rentals must be at or below the average market rate in the Affordable Residential Units bulletin. For Sault Ste. Marie a bachelor unit would rent at $695/month, one bedroom: $956/month, two bedrooms: $1,149/month, and three bedrooms: $1,037/month.

For ownership, the price should be 90% of the average price.

The plan establishes three main financial incentive programs:

Per-Door Grant Program – one-time grant for small-scale developments proposing up to four dwelling units. This grant is intended for the construction of new affordable units, but does make an exception for market-rate units within the First Neighbourhoods.

Tax Increment Equivalent Grant Program – provides an annual grant to cover a portion of the municipal property tax resulting from residential development, spread over several years.

Feasibility Study Grant Program – funds studies that assess the feasibility of building “missing middle” housing properties owned by Not-for-Profit agencies. These studies help identify the steps and resources needed for development at the concept stage.

Eligible properties for these programs include:

  • First Neighbourhoods and Downtown: Areas with significant need for affordable housing
  • Strategic Development Areas: Locations within a safe, walkable distance to various services and amenities.
  • The rest of the Urban Settlement Areas

The draft CIP will be presented to council later this summer and is available for review here.


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