Federal housing minister opposes Metro Vancouver development fees

I feel this topic deserves a moment to be discussed.  What is affordable housing?  How do we create affordable housing?  Is it bybuilding more density in housing - ie) condos?  I feel we have not discussed the actual price of affordable housing and rather use the vague word "affordable" - and this dance of the vague wording goes on and on.  What is affordable to one family might not be affordable to the next family.  So do we take the average income of a single person or do we look at the average income of a couple - their combined income.  How much does the average Vancouverite make in our city? These are all important numbers to consider.  

First and foremost when looking at new builds / new developments what seems to be forgotten is that the developer who builds homes is not a charitable organization.  They have created a business just like Starbucks has created a business.  Last I checked Starbucks doesn't give away free coffee or doesn't sell coffee at a loss to the business. And nore do we expect that from Starbucks.  (Sorry to pick on Starbucks coffee.)

A developer begings their project by purchasing land and then goes through the long and strenuous process of design, approval, permitting, building and so fourth.  From start to finish this takes minimum upward of two years.  The costs upfront depends of how large the project is and this can be hundreds of thousands of dollars if not millions of dollars.  There are carrying costs of property taxes, mortgage payments, lawyer bills, the process of getting permitting requires a lot of documentation, government fees such as development cost charge (DCC), architectual costs, labour wages, cost of lumber, windows, doors and obviously the city asks for a new playgrounds, or new sidewalks and the list goes on and on.  Last I checked none of these costs have gone down.   At the end of the day it gives the developer joy to create quality housing for families to live in but at what cost?   The risk is taken upfront by the developer.  The developer hopes that the end sale price will keep up with the cost to build the home.  The developer hopes that the homes will sell.

Let's circle back to the topic of affordable housing.  To keep the end product cost down the developers costs need to also be as low as possible with producing a quality product.  Our City has NOT given developers any breaks or lowered costs associated with building homes.  Yet they seem to love to throw the "halo" word of afforable housing, more rentals, more housing and so fourth are needed in our city.  They love to point fingers at others and say it has nothing to do with them yet do not give any breaks to the business who build the housing in the city.  Are you following what I am trying to say...?

Just this past Friday (October 27th, 2023) Sean Fraser (our Federal Housing Minister) wrote a letter to Metro Vancouver board chair and Delta Mayor George Harvie to suggest delaying the development cost charge (DCC) proposals, which could more than triple by 2027 should the board vote in favour.

Federal housing minister Sean Fraser has told Metro Vancouver that its proposal to increase housing development fees for new sewer and water facilities is “at odds” with his so-called Housing Accelerator Fund aimed at promoting construction.

Despite a push by Canada’s housing minister asking them to reconsider, Metro Vancouver’s board has gone ahead with big increases to fees on new construction.  What does this mean?  Yes - it means the price of housing will continue to go up.  It may also mean that developers slow down and cannot keep up with the population growth we are experiecing because it just doesn't make sense to build due to costs.  At the end of the day it is all of us who suffer with housing and rental costs that keep increasing.  


Changes to the City's Density

September 15th, 2023:  Vancouver’s city council gave their approval to a comprehensive zoning amendment with far-reaching implications. This amendment opens the door for the construction of up to 8 homes on single-family lots within all RS (Single Family) zoning areas. This novel zoning category, known as R1, presents a significant opportunity to address the housing needs of the “missing middle” family homes, who seek relatively affordable housing options, both for ownership and rental, throughout our city.

Under this new zoning, 33×122 lots will accommodate up to 4 homes, whereas the larger lots will permit 6 strata (for sale) ownership homes. There is also an opportunity to construct up to 8 homes on larger lots, provided they are designated as market rental units. This transformative change is poised to reshape our city, with some viewing it as a positive development while others express concerns, particularly among existing homeowners in quiet single-family neighborhoods. 

These newly termed “multiplexes” will boast a 1.0 FSR (Floor Space Ratio), equivalent to 100% of the lot size in buildable square footage. For example, a typical 33×122 lot should yield four homes, each being approximately 1000 square feet. These homes are likely to include a mix of 2 and 3-bedrooms. On the other hand, larger lots will accommodate up to 6 homes, predominantly designed as 3-bedroom townhouses to cater to families. There is also going to be additional density bonuses for Net Zero built houses with an emphasis on green construction and energy efficiency.  Keep in mind - Net Zero builds are more costly and this will be reflected on purchase prices.  

With that said, this new R1 zoning isn’t all about increases in density. The city has also implemented a 10% reduction in density for the allowable size of single-family homes, going from 70% FSR down to 60% FSR, likely to encourage the higher density developments.  It's hard to comment on why the city feels decreasing the FSR density for single-family homes accomplishes anything.  

Despite the general increases in density and relaxations through rentals and expensive "green" construction, there remain numerous uncertainties surrounding these initiatives, including issues the cost of building, parking provisions and the associated city fees for project development. Undoubtedly, this new zoning will bring about profound changes to our cityscape, marking a shift away from the traditional single-family home, which was considered a luxury.  However creating a positive change for those families who would love to move into a neighbourhood that was not attainable previously.  

If you seek more information about how these changes will impact your property and neighborhood, please reach out.

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