B.C. to add more municipalities to its housing target list

UPDATE: The province has set housing targets for 10 B.C. municipalities, per the Housing Supply Act. The targets represent net new units, and must be built within five years, the B.C. government says.

The British Columbian government is set to add more municipalities to its housing target “naughty list” Tuesday afternoon.

Housing Minister Ravi Kahlon is expected to put the spotlight on more communities around B.C. which the government feels are not creating housing quickly enough.

It will add to a list first list released this spring that included cities like Vancouver, Victoria, Abbotsford, Delta, and Port Moody. It’s part of the provincial government’s efforts to put pressure on municipalities, to kick-start a housing boom, and take pressure off prices.

B.C.’s Homes for People housing action plan includes expected legislation this fall that will allow up to four homes on a traditional single-family detached lot along with additional density in areas that are well-served by transit.

The province also intends to legalize secondary suites across the province and speed up often lengthy permitting processes.

An industry report suggests the government’s plan could work in making real estate a little more affordable, though it may not see as dramatic results as the province is predicting.

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“B.C. is currently experiencing historically low per capita housing starts, and a 50 per cent boost in starts by the end of this decade would bring activity back to the level of the early 90s, but still far below the levels of the 70s,” a new BC Real Estate Association analysis released Tuesday explained.

The BCREA report uses its own modeling and compares it to a similarly aggressive government housing action plan in New Zealand which, it says, is seeing results.

“Following the aggressive housing liberalization and upzoning policy in Auckland would eventually improve affordability in B.C. by slowing home price growth and allowing incomes to catch up,” it said.

“Additionally, expanding the housing stock would lead to healthier resale inventories and balance markets while shifting the distribution of sales toward principal owners by reducing speculative activity.”

But the BCREA Market Intelligence Report suggests it will take time to undo an affordability crisis that has been years in the making.

“BCREA’s Real Estate Policy Analysis Model (REPAM) predicts that such a boom in housing starts would increase home completions by 37 per cent per quarter relative to a status quo baseline by Q4 of 2030, while the total housing stock would be two per cent higher,” it added.

When it comes to affordability, the model predicts the increase in housing supply would pull average prices down by four per cent and slow price growth over the long term, calling it a “modest” improvement over current conditions.

“While these results are encouraging and show a path towards a higher standard of living for British Columbians, the scale and immediacy of the problem are also humbling,” the report concluded.

“Still, if policymakers can increase housing supply quickly and substantially through a combination of measures, there is hope that affordability can improve in the province again.”

Minister Kahlon is expected to give an update on B.C.’s housing target plan at 2 p.m. in Saanich on Vancouver Island.