The Canadian Home Builders’ Association of BC (CHBA BC) is disputing a new report from the Union of B.C. Municipalities (UBCM) that discusses progress made on affordable housing and the approach that should be taken to address the issue.
“Almost daily, we’re told that fixing B.C.’S affordable housing crisis is a simple matter of supply and demand, and that local governments aren’t doing enough to approve more housing to be built quickly,” reads the paper, titled A new Building BC: Housing Completions & Population Growth 2016-2021.
The paper argues that resolving the affordable housing shortage is much more complex than just building more homes.
It states tackling affordability will require incentivizing the right supply including affordable rental housing and co-ops, and addressing the market-skewing influence of speculative demand.
“Statistics show too much new housing construction is investor-driven and that is contributing to high prices for anyone trying to get into the housing market,” reads the report.
The report cites data from Statistics Canada, including the 2021 Census, that shows the number of houses being completed in B.C. closely matches its population growth.
However, CHBA BC responded to the report, arguing it fails to accurately represent the issue and is ignoring the role municipalities play in it.
“The report deflects any responsibility or accountability municipalities have in significantly increasing our housing stock. The industry sees this as a signal that municipalities remain resistant to reducing red tape, increasing service levels and approving more housing in their communities,” said Neil Moody, CEO of CHBA BC. “We can no longer afford to dismiss the housing supply-demand imbalance, and UBCM’s position frustrates the alignment we need to see at all levels of government to meaningfully and boldly address our housing needs.”
Moody cited data from Scotiabank that shows Canada’s population-adjusted housing stock is the lowest in the G7, and when looking at it provincially, B.C. is well below the G7 average. He stressed the residential market is extremely tight, with provincial active listings being 19 per cent lower than this time last year. Moody also noted that although there has been a recent uptick in registered new homes and building permit activity, these numbers are not indicative of the time it takes to reach the permit milestone.
“Approvals take years in Canada’s most expensive cities, and in Western Canada, the average timeline for municipalities is typically in the nine-to-15-month range, depending on the approval required,” said Moody.
He explained approval periods are generally lower in Alberta municipalities and higher in the municipalities studied in the Metro Vancouver Area. He cited research conducted by Altus Group for the association which found that each additional month a project is in the approvals process adds an average of $351,500 or $2,812 in costs per month, per unit for a low-rise project, and $216,300 or $1,730 in costs per month, per unit for a highrise project.
“Since the UBCM paper came out, our members have been quite vocal about their experiences with municipal permit applications not being processed in a predictable, transparent timely fashion,” said Moody. “There are fees submitted to cover the costs of processing an application, and members are finding service levels are not commensurate of these charges. Aspects of the review process were also found to be redundant and unnecessarily added process, like holding public hearings on applications that align with Official Community Plans.”
Moody added the industry and government need to be on the same page regarding housing supply issues.
UBCM responded to the criticism, saying they stand by their report and that it does not ignore the issue of supply.
“UBCM‘s housing report clearly demonstrates that local governments are not dismissing the importance of supply in the housing crisis, but rather that they are approving record amounts of housing on par with population growth,” said Laurey-Anne Roodenburg, UBCM president.
“Despite these efforts, B.C. still has a housing crisis. Rather than solely an issue of supply, it is clear that many factors – including the financialization of the housing market, shortages in skilled trades and materials, and multiple layers of provincial regulation — play an important role in the absence of attainable housing for many British Columbians. Successfully addressing the crisis requires an all government approach in collaboration with industry in bringing about substantive change at the community level.”
Russell Hixson is the staff writer for the Journal of Commerce where he covers the construction industry. Before that, he spent years in the U.S. as an investigative crime reporter. He lives in East Vancouver. Follow him on Twitter: @RussellReports.