Toronto city councillors are intrigued by Habitat for Humanity’s proposal to help developers provide condominium units at reduced cost to needy families.

Under Section 37 of the Planning Act, developers can apply to the city to build more units than allowed in return for paying for community benefits such as upgrades to the local community centre or streetscaping.

Instead of making payments which can run in the $1 million to $2 million range, Habitat suggests, the developer could sell units to Habitat at lower cost, with the difference between the sale price and market value counting as the developer’s Section 37 contribution.

With 20,000 condo units going up in the city each year, the city could gain potentially hundreds of low-cost units, said Habitat chief executive Neil Hetherington.

“I think we need to support this,” Councillor Ana Bailão (Ward 18, Davenport) said after Hetherington’s presentation to council’s planning and growth management committee Thursday.

“We have an affordable housing crisis on our hands,” Bailão said. “The only way we’re going to be able to start addressing some of the needs is by partnering with and listening to non-profit organizations and our development industry.”

Hetherington gave the example of a couple with one child and income of $36,404, who would pay 30 per cent of their total income on the mortgage and condo fees.

Because the unit would be delivered fully finished, the client could meet Habitat’s requirement to complete 500 hours of “sweat equity” by working on ground-level Habitat homes, he said.

Habitat would hold a second mortgage on the condo to ensure it couldn’t be flipped for a quick profit, he added.

After expressing support for the idea, the planning and growth committee referred it to staff to consider making it a new policy in the city’s Official Plan, which is currently being revised.

“It’s an amazing opportunity,” said Councillor Adam Vaughan (Ward 20, Trinity-Spadina), whose downtown ward includes the Entertainment District and other areas experiencing a condo boom.

“This could make it possible for low-income families to start living closer to work.”

While Hetherington said he hasn’t heard any negative comments from developers, he conceded it could take a while to revise the Official Plan to include a policy on low-cost condos.

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“I don’t know the exact timing on that, but what I do know is there are too many families who need us now. So I want to make sure the winding road is more of a straight path.

“We’re kind of a bulldog on this.”