Cut red tape to get new homes built
MEETING DEMAND: Finding ways to streamline municipal approval process could help bring prices down
The Province Guest Columnist: Bob de Wit
Thursday, April 21, 2016
Working in the garden this past weekend, I struck up a conversation with my neighbour about local real estate. My neighbour bought his place about a year ago and was excited to point out that the homes all around us have been selling for 40 to 60 per cent more than what he paid.
When most people look at real estate prices, it seems the focus usually falls on demand. You know the drill: The impact of foreign investors, in-migration and low interest rates.
But prices aren’t driven only by demand. Supply is equally important, and from where I sit, it’s pretty clear that housing has been undersupplied for many years. Just look at the numbers.
By 2041, Metro Vancouver will need nearly 500,000 new homes for more than one million new residents. This equates to 3,000 new residents each month seeking shelter.
The region as a whole has fallen short in meeting housing demand over the last several years; this shortfall totals, on average, 3,570 homes per year.
Vancouver’s March sales were 27.4 per cent higher than in March 2015, and 56 per cent above the 10-year sales average for the month.
At 5,173 unit sales in March this year, it was the first time more than 5,000 transactions have ever been recorded in a single month, as per the Real Estate Board of Greater Vancouver. Obviously, demand is not easing.
And where demand outweighs supply, prices will be driven upward.
Increasing the supply of housing is a key piece of the puzzle in solving Vancouver’s affordability issue. But how can we increase supply with the least amount of angst?
One thing we can do is improve the working relationship between cities, builders and community groups to make municipal approval processes far more efficient and increase the velocity of approvals without compromising quality and city policies.
Sounds great, but how do we get there?
Here at the Greater Vancouver Home Builders’ Association, research is conducted each year to find improved ways of bringing new housing to the marketplace. The resulting annual Getting to Groundbreaking report — or G2G — looks at the way new housing moves through the local government approval process, identifying time and cost issues and best practices.
One example in the recently released report identifies the potential of a $100,000 savings in development cost and 15-week time savings when land is pre-zoned for apartments. The report also confirms the need to improve the way municipalities and home builders engage and consult the public.
Apartment development can sometimes face opposition from existing residents who perceive the transition to a density higher than single-family housing as a negative. However, just as you can plant a variety of perennials in a garden, there are multiple forms of housing supply to help meet demand.
Low-rise wood-frame apartment housing and town houses are examples of “friendly density” housing supply that work well on transit served arterials and near neighbourhood centres, without overwhelming the neighbourhood with apartment towers.
It’s also the kind of housing that provides flexibility for different segments of the market, including families starting out and empty nesters downsizing.
The type of amenities that are provided as part of a new development can often ensure that the apartment building ultimately meets or enhances the livability requirements of those market segments, too.
I would urge homeowners to engage with local municipalities in support of housing choices that address change and growth of our neighbourhoods.
Urban growth is much like investment in your garden. Just as perennials provide pollen, nectar, seeds and nesting material for birds and butterflies for seasons to come, smart densification will lead to healthy communities with amenities to support the growth of our communities.
There is no quick fix or one answer to Metro Vancouver’s housing and affordability issue. However, if we work together, using best practices to bring a variety of housing supply to the marketplace, we can be sure to shape livable communities for generations and seasons to come.
The Getting to Groundbreaking (G2G) project has already resulted in process improvements. A wide array of innovations were adopted in 2015 alone by municipalities to improve upon efficiency and effectiveness of their residential development approval processing.
Visit gvhba.org/events/gettingtogroundbreaking for more details and to review the full G2G report.