Toronto did not cut development charges when it froze them. It removed the yearly indexing for 2025 and 2026, so rates stayed at their 2024 level instead of rising 4% on May 1, 2025. Separately, Council directed cuts of 40% to 60% for 2026 to 2029, but those depend on a funding agreement with Ontario.
What development charges are
The City describes them as fees on development and redevelopment that help pay the capital cost of infrastructure for growth, such as roads, transit, water and sewer pipes, community centres and emergency services. The developer pays. Affordable housing and shelter services were removed from what the charges can fund on November 28, 2022.
What indexing did
Under the 2022 by-law, rates rose every May 1 to follow construction costs. Council removed indexing for 2025 and 2026, using authority from the Protect Ontario by Building Faster and Smarter Act, 2025. That is why the word is freeze and not cut. A City presentation from July 2026 says indexing is also paused for 2027 to 2029, but the City’s main page does not state it, so check the by-law before relying on that.
The rates today
Per-unit charges for non-rental homes on the June 26, 2025 schedule are $137,846 for a single or semi-detached house, $113,938 for a multiple unit with two or more bedrooms, $57,153 for a studio or one-bedroom multiple, $80,690 for a large apartment, $52,676 for a studio or one-bedroom apartment and $37,356 for a dwelling room.
Rental units pay less: $33,497 for a one-bedroom apartment, $48,299 for two bedrooms, $45,280 for three or more and $23,759 for a dwelling room.
What the freeze avoided
A 4% increase on a $137,846 house would have added $5,513.84, giving $143,359.84. On a $52,676 one-bedroom apartment it would have added $2,107.04, which is $210,704 across 100 units. The 4% figure comes from a City summary of the scheduled indexing, so treat the sums as estimates.
Bigger cuts for 2026 to 2029
According to the City’s June 23, 2026 release, Toronto will be able to cut charges by 40% to 60% depending on unit type, beating the 30% to 50% the program requires. Council directed 40% for studios and one-bedroom units and 60% for larger units, houses and dwelling rooms. The City’s page says the by-law amendment is pending a transfer payment agreement with Ontario, so the cuts are conditional.
Applied to the non-rental rates, a house falls to $55,138.40, a cut of $82,707.60. A large apartment falls from $80,690 to $32,276. A one-bedroom apartment falls to $31,605.60, a cut of $21,070.40.
Take a 60-unit building with 20 small and 40 large apartments. Before cuts the charges are $1,053,520 plus $3,227,600, or $4,281,120. After cuts they are $632,112 plus $1,291,040, or $1,923,152, a saving of $2,357,968. This is our arithmetic, and the City has not published a reduced table on the pages we could open. Run your own unit in the development charges calculator.
Who covers the gap
The bill moves, it does not vanish. The City says the cuts are supported by $1.2 billion of its own contributions as of the first quarter of 2026, including the indexing freeze, plus $1.5 billion over ten years from the Canada-Ontario Partnership to Build. That money backs capital work already in the 10-Year Capital Plan. The $1.2 billion also counts a 15% property tax reduction for new multi-residential buildings and exemptions for rental and affordable programs.
When the charge is paid
Non-residential charges fall due at the first building permit. Non-rental homes pay at the occupancy permit. Rental projects pay in six equal annual instalments from occupancy. Buyers of new homes often face this alongside closing costs, so check the closing costs calculator. We found no official study of how much of a cut reaches buyers, so ask the builder in writing how charges are treated in your agreement.
What is still open
The Ontario agreement was not confirmed on the pages we read, and the City’s full review of the charges is expected to run through 2027. The safe reading is that rates are frozen through 2026, deeper cuts are directed but conditional, and anything later is a plan. See also the Toronto Land Transfer Tax calculator, and the full set of real estate calculators.
Sources
- City of Toronto, Development Charges Overview
- City of Toronto, Development Charges
- City of Toronto, $1.5 billion Partnership to Build funding
Common questions
Did Toronto lower development charges?
Who pays development charges?
What did the freeze avoid?
Last reviewed: . Figures come from the official sources listed above. How we check the numbers and our editorial policy.