Hamilton will cut development charges by 20% for two years starting in September in an effort to bolster the struggling residential-construction sector.

City council recently approved the measure in a 9-3 vote.

“This is one more step in a coordinated strategy to increase housing supply for Hamilton residents,” said Mayor Andrea Horwath. “Hamiltonians are feeling the pressure of the housing crisis — we need more homes people can afford, and we need them built faster.

“By helping to unlock stalled projects, we’re responding to what we’ve heard from builders, non-profit partners and residents, and we’re doing it in a way that supports our local construction industry, maintains transparency, and protects taxpayers.”

The temporary measure will apply to both residential and non-residential projects. Lowering the charge for a single-detached home to $78,809 from $98,511, according to The Hamilton Spectator.

City staff estimate the reduction will cost $9.6 million annually, covered by funds set aside for exemptions in the 2025 budget.

Mike Collins-Williams, CEO of the West End Home Builders’ Association, welcomed the move.

“The residential construction industry is in a state of collapse with thousands of jobs at risk across Hamilton,” he told the Spectator.

Between 2019 and 2023, Hamilton collected an average of $102.8 million per year in development charges, the report states. Revenue fell to $57 million in 2024 and is projected to drop to $48 million in 2025, reflecting a steep decline in housing starts — to 1,481 in 2024 from 3,347 the year before.

The city has called the cut a balanced response to industry concerns while aiming to limit tax and rate impacts on residents. Industry representatives had sought a 50% reduction similar to measures in some Greater Toronto Area municipalities, the Spectator reported.

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