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In recent years, the "progressive YIMBY” (Yes, in my backyard) movement has embraced the idea that a surge in market-housing supply will magically lead to affordability.
However, all housing supply is not created equal. Despite a construction boom building thousands of new market units of multi-family supply, affordable housing remains elusive for over a third of British Columbians. The economic theory is not producing the promised housing affordability.
As the modelling and analysis that Housing Minister Ravi Kahlon used to justify the BC NDP’s mass upzoning of single-family, middle-class neighbourhoods shows it will produce less than half the supply needed to meet the demand.
The Canada Mortgage and Housing Corporation estimates for B.C. to get housing affordability back to what we experienced in the early 2000s, we need to build 610,000 units more than would have been constructed.
Tom Davidoff, one of the report’s authors, is cautious in his predictions of both the affordability achieved by the upzoning and the immediacy of the changes. The BC NDP’s approach is not an urgent solution to a housing affordability crisis but rather a short-term communication exercise, increasing the wealth of homeowners and hopes of renters leading into a provincial election.
We have an urgent housing affordability crisis and this is evidence of how inefficient it is to wait for the private sector to deliver housing affordability.
The housing crisis is more localized for those experiencing core housing need. The core housing needs are the people in our communities whose housing is insecure, inadequate or unaffordable. In B.C., nearly 15 per cent of the population is paying more than 30 to 50 per cent of their annual income on housing. This is the most critical intervention point for the provincial government.
A 2021 Statistics Canada report shows the core housing need in Canada is 10.1 per cent, ranging from Quebec at six per cent to Nunavut at 32.9 per cent. B.C. is second worst at 13.4 per cent, followed closely by Northwest Territories (13.2 per cent) and Yukon (13.1 per cent). The next closest province is Ontario, at 12.1 per cent.
The core housing need is far more likely to impact renters than homeowners. Twenty per cent of renters are in core housing need, while homeowners are only 5.3 per cent. As I argued in debate on Bill 44, it has potentially dramatic long-term socio-economic consequences.
A Statistics Canada report published on Nov. 20, 2023, shows unsurprisingly the dramatic intergenerational advantage the adult children of homeowners born in the 1990s have over their peers whose parents weren’t homeowners.
Additionally concerning is the findings that “adult children of multiple property owners were nearly three times more likely to be homeowners in 2021 than those whose parents were non-homeowners,” and B.C. has the lowest rate of homeownership of people born in the 1990s in the country.
The new legislative changes in B.C. unilaterally turned single property owners into multiple property owners. The modelling and analysis reports “we expect any windfall gains from rezoning to accrue primarily to incumbent property owners, which can exacerbate inequalities in wealth without the landowner providing a social benefit.”
The housing minister showed little concern about this during the debate.
The private sector development industry has produced an all-supply-is-good-supply narrative that allows it to continue building high-value market products under the guise of diligently solving affordability.
Before the 1990s, Canada and B.C. actively built non-market, non-profit, co-ops and social housing. The deliberate shift of responsibility to the private sector elevated the priority of profitability and wealth creation over ensuring housing affordability. The expectation that a sufficient supply of affordable housing would emerge despite the private sector's pursuit of profit oversimplified the complex dynamics of supply and demand.
Recently, blame has been directed at local governments for inefficiencies in approvals and resident opposition (Not in my backyard/NIMBYs), conveniently taking the heat off the role the private sector is playing in increasing housing prices. Demonizing local governments is convenient but again an oversimplification.
In my experience, local elected officials recognize the urgency and are working to create solutions to increase affordability in the private sector market. They have limited tools and intervention points in the upzoning and subdivision process.
The housing affordability crisis in B.C. is stark, with over 100,000 households in extreme core housing need. This vulnerable population spends more than half their income on housing, living in constant fear of homelessness.
The BC NDP focus on profit-driven private sector solutions exacerbates the situation — inflation, interest rates, and ballooning construction costs — drives market prices further out of reach.
As homelessness rises, there are socio-economic consequences of relying on the profit-oriented, private sector housing market to deliver affordable housing. In affluent communities like Salt Spring, the unhoused and housing insecure population grows — people on couches, in vehicles and in encampments — while mansions are built and sit empty most of the year.
Urgently providing adequate and secure housing at a price people can afford stabilizes our communities. When people who cannot afford the market price of housing are no longer lining up for those houses, the vacancy rate stabilizes, relieving pressure across the housing continuum.
Critically, the housing minister's approach to reform through mass upzoning is flawed. For one, treating all supply as equal is a community planning disaster. For two, the BC NDP didn’t require any of the new supply created by Bill 44 to have any housing affordability measures. Minister Kahlon ensured the housing he was “legalizing” would be built by the private sector where and when there is profitability, not affordability.
In the short term, the BC NDP should prioritize aggressively addressing the core housing need. A strategic, data-driven effort to build non-market affordable housing options across multiple communities is imperative. This focus should continue until only those who can afford the private sector housing market remain in that segment.
The private sector development industry plays an important role in providing market housing to British Columbians. But not all British Columbians. They have failed to address the core housing need. They have a choice — collaborate to address mass housing insecurity or continue business as usual.
NIMBYs and YIMBYs must unite for this crucial cause. However, we must move beyond the oversimplified belief that all supply is the same. Housing Minister Kahlon's time would be better spent on the real problem at hand — urgently addressing the core housing need — rather than perpetuating an escalating crisis.
Adam Olsen (SȾHENEP) is the member of the legislative assembly for Saanich North and the Islands and member of the BC Green caucus. He was first elected in May 2017 and re-elected in October 2020.
Comments
‘Sick City’: What the Pandemic Tells Us about Our Housing Crisis
https://thetyee.ca/Culture/2021/05/07/Sick-City-Pandemic-Housing-Crisis/
"If speculators know their windfalls will be whacked by taxes they won’t buy and flip property, so land will remain cheaper and whatever does get built won’t reflect inflated costs.
He also proposes zoning that mandates below-market housing be built as a certain percentage of any new development...
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The market for urban land is the problem, not the number of housing units produced. Adding new density just inflates land price and enriches land speculators.
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Cambridge .. passed an “Affordable Housing Overlay” zone that covers the entire city. It allows a doubling of density on any parcel, if and only if the entire building is permanently affordable to those making median area wages or less..With this restriction it stabilizes land prices and lets the non-profits compete for land on equal footing with market housing developers.
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...doing what we do now, incentivizing high-priced housing construction in the hopes that it will make housing prices fall is obviously not working. What we are doing now is raising average rents, displacing renters and adding to the land price feeding frenzy that enriches only land speculators. What we are doing now is driving our kids and grandkids out of the city they grew up in and forcing our crucial frontline service workers out of a city they can no longer afford. This is how cities die."
I don't believe Patrick Condon has all the solutions, though his heart is in the right place in several areas.
If adding new density merely inflates land prices and enriches speculators, then that problem began when the first giant cedar fell on the first acre of unceded Inigenous land for "speculators" known as farmers and seafarers housed on a dock.
160 years later we have a big growing city and no more land. And a big problem. And critics who own their own house or condo that rests on a plot of land originally carved from the ancient forests owned by Indigenous tribes, railing against a market that would continue to build on the next door.
Adding fresh density is not the problem by itself. That density could be in the form of publicly funded co-ops and non-market rentals. It could be in the form of private housing of moderate density mixed with sidewalk retail. Or it could take on a mix of public, quasi public (co-housing) and private housing with more retail, offices and institutions ... otherwise known as mixed use, ideally with decent transit.
The latter is the best solution, in my view, for a city that ran out of land and, only until recently forced to, now has to address the elephant in the room: the exclusionary zoning that protected the almighty detached house on large lot subdivisions that occupy 80% of the residential land for just 30% of the housing, therein squeezing towers into the 20% of land left over.
It all gets down to land use planning, and after that urban design. So far, it's been terrible, but has been ignored in the zeal by critics to blame the market which is only responding to the available zoning, and indeed with speculation in the absence of non market solutions that would be a counterweight.
All the government has to do is work with cities to ensure their housing policy has some fine grain at the local level, that residents have more amenities closer to home, and to inject more non profit and co-op housing funding into the mix. BC Housing is already doing some of that, and in some cases is working directly with cities who are already offering their own land for such projects (not a peep about that from Olsen). Add more transit and we're cooking with clean power.
It some respects the reaction is kinda like MAGA whining on the left, lots of complaining about the problems -- rampant speculation, density, development -- but few workable solutions. Stop development? Stop density? Jail the speculators? Pump hundreds of billions every year into public housing in Metro Vancouver to acheive the Vienna model? Radically increase taxes on the incomes of homeowners? Build a wall around all major cities? Fill in English Bay to create more land for housing in Vancouver?
Well, armchair revolutionaries, we wanna see a plan that actually works.
Bad headline. The point is not that we can't build our way out of the housing crisis, it's that we can't ask the private sector to build our way out of the housing crisis for us. Governments building housing is a different thing, and I agree should be far more emphasized than it ever is these days.
I take the article's point about the drawbacks of the upzoning law and of private sector led development. That said, the upzoning law remains important. First, because the "less than half" the article says it will create is a lot more than nothing. Just because one single policy doesn't solve your whole problem doesn't mean it's useless; add a few policies together and you might seriously get somewhere. Second, because up to now zoning has often been in the way of attempts by various levels of government to build new housing. You can try for a zoning exception, but then there's years of scrutiny and effective NIMBYism and the thing won't get built for ages or maybe ever. The upzoning law can allow and fast-track public sector building as well as private sector.
Well put.
I would add that though the new BC gov't policy is indeed too general and could use a supplementary level of planning and urban design at the neighbourhood level, it does take a sledgehammer to that icon of bad planning from last century: the single family detached home.
A more fine-grained approach would permit ATTACHED single family homes, i.e. non-strata rowhouses of all sizes and for all incomes, ones with basement rental suites and small walled back yards. Next would come low rise rentals and condos off thevarterials, without shying away from permitting small offices and stores at the sidewalk level. Who would ever object to the reappearance of the traditional corner store sprinkled throughout most residential neighborhoods?
BC's effort is prescriptive in that they are forcing cities to build density around transit, something the Metro has been doing fairly well compared to suburban GTA, Montreal and Calgary. This is appropriate, and I don't think Metro Vancouver will see much difference in the original Livable Regions Strategic Plan from the 90s. Metro planners saw huge geographical constraints in the context of demographic growth, and their LRSP was wise before its time.
I don't see the BC effort resulting in high rises in the existing low density sprawl away from transit, but with local effort, the plan could evolve into the gentle density and walkable neighbourhoods that most mid-sized European cities enjoy. But transit in all its forms needs to be better everywhere.
Who wants to build affordable housing? It cost more to build than you can get back. Land cost, build costs, regulation costs, loan costs. Affordable rents will come from oversupply. Right now, even cheaply built 40 years old apartment's are going for nearly the same price as premium units.
From my observations, what builders are pushing as affordable housing is a joke, at least in Ontario anyways. I see nothing in these units being built in my area will solve the affordability problem, as the selling prices are no better than what they were before.
But there is another issue being overlooked by the generation whining about affordability. The issue I see is their lifestyle is part of the problem and it seems they want their cake and eat it too. They will never be able to afford to buy a home if they continue to party, continually ordering from Uber Eats, fast food joints, buying expensive overpriced vehicles that exceed practical requirements or expensive toys like ATVs or snow mobiles. The Me Me generations are not willing to buckle down and do what is needed to achieve home ownership. They have had it too easy and blame everyone else, including the government, for their inability to make sacrifices to achieve ownership.
Don't forget to add dozens of trips to the far corners of the Earth before they're even 40, trips that put the lie to their great concern about climate change.
I had a question for those many Gen Xers and Millennials who expressed loads of envy over my ownership of a modest fixer upper on a tiny lot: Will you sacrifice 10 years of vacations to remove lead paint from the siding, remove terrible "modernization" projects by previous owners that hid multiple building code violations behind false ceilings and walls, replace leaky single glazed windows with double glazing, deal with burst pipes, and on and on?
Invariably, silence followed. Affordability is relative. Yes, prices are high, but sweat equity is monetarily cheap if one can swing the down payment with Daddy's help, and manage the mortgage payments with rental income from a basement suite.