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Originally Posted by Slava
By how much, in each case?
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Honestly, I don't know. Having said that, the high prices observed for inner city, family homes reflects high demand. What we don't see is a large quantity demanded, which is a different quantity that also reflects suppy (quantity demanded and quantity supplied are the same for a market in equilibrium).
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Quote:
Originally Posted by Bunk
The big shift if we were aiming for true cost recovery of new growth would relate to the acreage assessments (development levies). The City recently doubled the acreage assessment from about $7500 a door to about $15,000 a door. This moved us from covering about 25% of the capital cost to service a new home to about 50%. The Mayor believes this did not go far enough and that we should work toward full cost recovery. If we moved to full cost recovery, the acreage assessment will move to about $30,000 a door, which would have an impact on the purchase price of the home. Each agreement is 5 years, so I imagine it will continue to move closer to that full cost recovery number eventually.
It's an inherently unsustainable situation when each new home is actually a net cost to the City, rather than a net contributer - at least on the capital side. There's been less work done (although it's ongoing) on the relationship between new growth and operating costs.
Of course, redevelopment comes with some cost, although not as much as growth on the fringe - and at some point there's likely to be a new redevelopment levy to help cover some of those costs. Of course, you don't want to be punitive with that and discourage redevelopment, which on balance costs the City much less.
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Getting back on topic, does the $30,000 figure account for things like downstream effects on infrastructure (e.g. needing the 8th Ave Subway so that people can still get on the trains at Heritage)?
Also, why is a CRL appropriate to make something like the East Village pay for itself, but not for a new community on in the suburbs?