Best Practices to Inform a Mixed-Income Public Housing Future in Toronto
Introduction
Toronto stands at a critical juncture. As one of the fastest-growing and most unaffordable cities in North America, its public housing system the largest in Canada and second-largest on the continent is under immense strain. The Toronto Community Housing Corporation (TCHC) manages over 43,000 homes serving nearly 94,000 tenants across 1,300 buildings.
Yet, decades of underfunding, shifting demographics, and a reliance on a residualized rent-geared-to-income (RGI) model have left TCHC struggling to cover operating costs, address a multi-billion-dollar capital repair backlog, and expand its stock. The 2025 report, Best Practices to Inform a Mixed-Income Public Housing Future in Toronto, authored by Priya Perwani and Dr. Carolyn Whitman for the University of Toronto’s School of Cities, explores a fundamental question: What lessons from current international and Canadian good practices in mixed-income public housing can be adopted by TCHC?
The report makes a compelling case that a mixed-income housing model one that serves very low-income, moderate-income, and middle-income households side by side offers a viable pathway to financial sustainability and social integration. It draws on case studies from Vienna, Paris, Helsinki, Ottawa, Montreal, and Whistler, offering six concrete recommendations for TCHC and the City of Toronto. Central to the findings is the idea that public housing must be repositioned not as a residual safety net for the poorest, but as essential urban infrastructure that supports workforce stability, economic resilience, and equitable communities.
The Current Challenge: Residualization and Fiscal Strain
TCHC was originally designed to house the working poor households with at least one full-time wage earner. Over time, however, the tenant population has shifted dramatically. As of 2025, 86% of TCHC tenants receive RGI subsidies, and 53% of households include a person with a disability, compared to 20% in the rest of Toronto. Single-parent families make up 25% of TCHC households. This deepening concentration of vulnerability means that many tenants cannot pay enough rent to cover operating costs. In fact, RGI units (85% of the portfolio) cover only 36% of TCHC’s operating expenses. The Mayor’s Task Force on TCHC (2016) had already recommended reducing RGI units to 70% of the portfolio, but progress has been slow.
At the same time, Toronto’s housing affordability crisis has widened. Tens of thousands of moderate- and middle-income households nurses, paramedics, transit workers, teachers, and tradespeople are being priced out of the city. The Greater Toronto and Hamilton Area (GTHA) contributes 20% of Canada’s GDP, but housing unaffordability costs the region an estimated $7.5 billion annually in lost productivity and labour shortages. Businesses across Ontario report difficulty attracting and retaining workers due to the lack of affordable housing. The report stresses that TCHC’s sustainability is not merely a social equity issue; it is an economic resilience issue.
Historically, federal operating support for public housing was withdrawn in the early 1990s, and responsibility was downloaded to provinces and then to municipalities. By 2002, Toronto was left with insufficient resources to maintain aging infrastructure. The average age of a TCHC building is 55 years. Past redevelopments such as Regent Park, Don Mount Court, and Lawrence Heights relied on public-private partnerships that sold public land to private developers. Of the 10,544 homes redeveloped on TCHC properties in the last decade, only 20% were RGI replacements, and just 9.6% were affordable for moderate-income households. The remaining two-thirds were market-rate homes, often unaffordable to Toronto’s workforce. Critics argue that these “entrepreneurial strategies” prioritized marketability over inclusive communities.
What Is Mixed-Income Housing? Two Core Rationales
The report defines mixed-income housing as developments or portfolios that include a range of affordability levels from deeply subsidized RGI units to affordable rents for moderate-income households and even market-rate units. This approach is not a step away from affordability but a reconfiguration of housing delivery for long-term viability. Two principal rationales underpin the model:
1. Financial Sustainability and Redevelopment Strategy
In the absence of predictable, sustained federal or provincial funding, mixed-income housing allows public providers to generate surplus revenue from affordable or market-rate rentals to cross-subsidize loss-making RGI and supportive housing units. When structured properly, each building can cover its operating costs and service its debt. Applied at the portfolio level, this approach enhances borrowing capacity and reduces reliance on one-time government grants. The report notes that TCHC already has 10% mixed-income buildings from the 1970s and 1980s federal programs, but the model has not been scaled.
Financial sustainability also includes acquisition strategies. Tools like the federal Multi-Unit Residential Acquisition Program (offering 470 million in non-repayable contributions plus $1 billion in low-interest loans) can help TCHC acquire existing market buildings and convert them to permanently affordable homes for a range of incomes.
2. Social Integration and Mobility Across Incomes
Mixed-income universalist models reduce racial and economic stigmatization of public housing residents. They allow people to age in place and remain in their communities as their incomes rise or fall. This stability enables residents to pursue education, employment, or recover from economic shocks without facing displacement. However, the report is careful to critique the paternalistic assumption that low-income tenants will adopt “better” behaviours simply by living near middle-income neighbours. Evidence for such normative influence is weak. Instead, the report emphasizes that mixed-income housing should be designed to respect the resilience and agency of low-income communities, not as a deficit-oriented intervention.
International Models: Vienna, Paris, Helsinki
The report examines three European cities widely regarded as leaders in nonmarket housing.
Vienna, Austria
Vienna is frequently cited as a role model. Nearly half of all households live in nonmarket housing, either municipal housing (220,000 dwellings) or limited-profit housing associations (LPHAs). Eligibility is broad: 80% of households meet the income ceiling. Rents are cost-based, tied to actual construction and operating expenses, not market prices. The financing model combines low-interest federal loans, municipal capital grants, and tenant contributions. Crucially, Vienna retains public ownership of land, embedding affordability covenants for a century or more. This contrasts sharply with Toronto’s Regent Park, where public land was sold to private developers and affordability covenants last only 20 to 30 years.
Paris, France
France maintains one of Europe’s largest public rental sectors, with over 40% of renters in public housing. Eligibility extends to roughly 60% of the population. Under the national SRU law (2000), Paris is required to build and acquire social housing across all income levels to counter spatial segregation. The city exercises preemption rights to acquire land and buildings in wealthy areas. Financing comes from long-term, low-interest loans from the public investment bank CDC, capital grants, and employer contributions.
Paris also operates a single, transparent, criteria-based waiting list that covers deeply affordable, moderate-, and middle-income housing. In contrast, Toronto’s waitlist is fragmented: RGI housing uses a centralized weighted list, while “market affordable” homes are accessed directly through developers with little transparency. As of 2018, over 106,000 households were on Toronto’s RGI waitlist, with waits exceeding a decade.
Helsinki, Finland
Finland’s model is notable for its intergovernmental coordination. The national Housing Finance and Development Centre (ARA) provides interest-subsidized loans and partial grants to municipalities, non-profits, and limited-profit developers. Public housing follows a universalist, cost-recovery approach, with allocation based on social need and income (up to median levels). Helsinki mandates a tenure-mix policy requiring new developments to include market-rate, right-of-occupancy, and ARA-subsidized rental housing. This goes far beyond inclusionary zoning’s typical 5-20% “below market” affordable units for limited time periods. Security of tenure is protected through long-term contracts and strict eviction criteria.
Canadian Examples: Ottawa, Montreal, Whistler
The report also looks at Canadian public housing providers that have made progress on mixed-income models despite similar constraints.
Ottawa Community Housing (OCH)
OCH is Ontario’s second-largest public housing provider, with over 15,000 homes. It has moved beyond being a landlord to become a direct developer, building, acquiring, and renewing stock. A flagship project, Gladstone Village, will deliver up to 1,100 homes, with Phase 1 offering 336 affordable units for low- to middle-income households. Another project, Mosaïq, includes sustainability features like passive house design and solar panels. OCH retains ownership of land and buildings, ensuring long-term affordability. However, critics note that some OCH developments risk commodification and financial accumulation. TCHC is nearly three times larger than OCH and has relied more heavily on private partnerships, resulting in only 10% of new units being affordable for moderate incomes.
Montreal (OMHM)
Montreal has set ambitious targets: 12% nonmarket housing by 2034, 20% by 2050. The Office municipal d’habitation de Montréal (OMHM) manages over 20,000 homes. A notable project, Ilot Rosemont, combines public housing, co-op housing, and affordable rentals for seniors and families near transit, along with offices, a library, and daycare. Fifty percent of new housing in the project is nonmarket. However, Montreal’s inclusionary zoning bylaw (20-20-20) defines affordability at 90% of market rent unaffordable for many low-income households. Developers can opt to pay cash instead of building units, reducing supply.
Whistler Housing Authority (WHA)
Whistler offers a unique workforce housing model. Facing polarized demand between seasonal service workers and wealthy second-home buyers, the municipality created the WHA in the 1990s. Today, it manages 7,300 beds (1,517 units) for a population under 10,000. Units are permanently affordable through land leases, resale restrictions, occupancy caps, and public ownership of land. The WHA serves households earning up to 40,000 and $125,000, and two-thirds spend more than 30% of their income on housing. Whistler demonstrates that workforce housing is both a social and economic necessity.
Recommendations for TCHC and Toronto
Drawing on these case studies, the report offers six recommendations:
1. Position housing as essential infrastructure
Toronto must frame workforce and affordable housing as critical public infrastructure, on par with transit and water systems. Without stable housing, the city’s economy cannot function.
2. Align municipal targets with national frameworks
The Office of the Federal Housing Advocate recommends 200,000 nonmarket homes annually. Toronto has committed to 65,000 rent-controlled homes over the next decade, including 6,500 RGI units. TCHC should target at least 6,500 new or acquired homes per year.
3. Advocate for predictable provincial and federal funding
Vienna, Paris, and Helsinki succeed because of consistent senior government support: low-interest loans, capital grants, and public land. Toronto must push for greater provincial rent support and federal capital grants under the next phase of the National Housing Strategy (2027-2028).
4. Expand and integrate housing access systems
Following Paris, TCHC should work with the City to develop a single, transparent waitlist covering deeply affordable, moderate-, and middle-income housing. This would improve equity, mobility, and public confidence.
5. Retain land and guarantee long-term affordability
Public land must not be sold to private developers. Instead, use long-term leases and extended affordability covenants (50+ years, ideally a century).
6. Embrace partnerships and a portfolio-wide strategy at TCHC
TCHC should adopt a direct developer role, like OCH. Its portfolio strategy should balance deeply affordable RGI/supportive units, moderate-income workforce housing, and cost-recovery market rentals.
Conclusions: A Path Forward
The report concludes that Toronto cannot meet its affordability needs through market housing alone. Mixed-income public housing offers a pathway to financial sustainability and social integration, but only with bold leadership and coordinated support from senior governments. Vienna teaches the power of land retention and cost-based rents. Paris shows how integrated waitlists and tenant protections ensure equitable access. Helsinki demonstrates that intergovernmental collaboration enables cost-based rents and prevents segregation. Ottawa illustrates the value of public developers and partnerships. Montreal highlights the limits of market-led inclusionary zoning. Whistler proves that workforce housing can be delivered at scale.
For TCHC, the key takeaways are clear: mixed-income housing reduces stigma, fosters inclusion, and allows residents to stay in their communities. It provides a financial model through cross-subsidization, making redevelopment viable. But success depends on predictable federal and provincial support. Without it, neither TCHC nor the City of Toronto can scale mixed-income housing to meet the urgent needs of both vulnerable residents and the essential workforce that keeps the city running. The report is both a warning and a roadmap: the time for incremental change is over. A mixed-income public housing future is possible, but only if Toronto acts decisively, learns from global best practices, and treats housing as the fundamental infrastructure it truly is.
Also Read: 2017 Housing Affordability Response Team (HART) Recommendations