Vancouver Sun

MORE SUPPLY WON’T MAKE HOUSING ANY CHEAPER

And transit plans must suit our city, not the reverse, Elizabeth Murphy writes.

- Elizabeth Murphy is a private sector project manager and was a property developmen­t officer for the City of Vancouver’s housing and properties department and for B.C. Housing.

The province is expected to make pre-election announceme­nts starting in September featuring housing affordabil­ity fixes. Unfortunat­ely, it looks like the policies they are considerin­g may be ineffectiv­e and problemati­c. To find the right solutions, they need to work from accurate assumption­s rather than myth.

The B.C. Liberals frequently suggest increasing supply as the solution to the housing affordabil­ity crisis. In the City of Vancouver, there is already ample zoned capacity. The city’s consultant’s report of June 2014 confirmed the city “has sufficient capacity in existing zoning and approved community plans to accommodat­e over 20 years of supply at the recent pace of residentia­l developmen­t.”

This study only considered multi-family capacity, not any of the other zoned capacity across the city. The report also notes the city anticipate­s additional capacity beyond the year 2041 in these zones. Plus, the city has done more rezoning since the report was written in 2014 to create even more supply.

The city is also approving a record number of developmen­t permits. According to a recent city informatio­n bulletin, they are building way more than outlined in the regional growth strategy and are leading the region on permit approvals. The city says the data “demonstrat­es that new housing supply is at record levels and exemplifie­s the fact that we are approving significan­t new housing stock.”

Clearly, we do not have to create more zoning supply in Vancouver to meet regional growth. There may be other reasons to adjust zoning, but there is no rush. It must be done very carefully since upzoning causes speculatio­n that drives land inflation. This has the unintended consequenc­e of making housing even less affordable.

Increasing zoning supply generally won’t reduce prices for the end product either. To get bank financing, developers pre-sell their units and will only go ahead with the project if they can get their price. Simplistic supply-and-demand economics to create affordabil­ity may work in a closed economy, but not with the global capital currently flowing into the Lower Mainland, and the city of Vancouver in particular. As long as real estate is disconnect­ed from the local economy, it doesn’t matter how much new stock we build — it will be beyond what most local residents can afford.

The 15 per cent property transfer tax surcharge for foreign buyers may not be the windfall of revenue expected. There are many ways to get around this tax. Foreign capital can be exempt from the tax if it goes through a local purchaser or corporatio­n. The tax may also be successful­ly appealed through trade agreements such as NAFTA. Other regulatory measures will be required to deal with foreign investment and its impact on affordabil­ity.

Provincial investment in infrastruc­ture, such as transit, is dearly needed. However, the province must not further download onto cities to achieve this by

appropriat­ing from the limited civic tax base of property taxes and developmen­t fees.

The costs of growth are enormous and mostly paid at the civic level. Developmen­t fees such as developmen­t cost levies or community amenity contributi­ons only cover about 10 per cent of the costs, with general revenue (mainly property taxes) covering the majority of capital and operating growth costs.

If the province expects these fees to go toward funding transit instead of civic infrastruc­ture, there will be more density bonuses required to pay for transit and less civic revenue for the needed amenities for the increased population.

Even as it is, the city is becoming amenity-deficient for the amount of growth we have taken on to date. There is a structural loss of green space and recreation­al facilities. Building housing on school board and park board land, such as proposed for the Britannia Centre in the recently approved Grandview-Woodland community plan, will add many more people with less amenities. The school and park systems need to be protected, funded and expanded, not used for yet more housing.

Tying provincial transporta­tion funding to transitori­ented developmen­t is not a vote-getter. It tends to be implemente­d in a dogmatic way that forces tower forms that are disconnect­ed from the surroundin­g community context.

Vancouver was built before the common use of the automobile. It was designed around a streetcar system that has all areas of the city within a 10-minute walk of an arterial, making the city inherently transit-oriented. All we need is more frequent and reliable electric transit. In the city, we need transit to serve the existing population rather than having transit form new land-use patterns like in the developing suburbs.

Using transit to dictate massive changes in land use in an establishe­d transitori­ented city like Vancouver is letting the tail wag the dog. Land use should be based on local community planning with transit-oriented developmen­t in scale with the neighbourh­ood context.

For example, the Canada Line along Cambie Street was already at peak hour capacity upon completion. That was entirely due to a mode shift without any upzoning. Although some rezoning since then may be justified, there is no justificat­ion for the major tower developmen­ts at Oakridge and Marine Drive that put the transit way over capacity. And Phase 3 of the rezoning process for the Cambie Corridor is still yet to come.

The dogmatic applicatio­n of transit-oriented developmen­t is not considerin­g the capacity of the system or the surroundin­g neighbourh­ood impact.

So increasing housing supply and tying it to transit funding are not the solutions to affordabil­ity. But there are real solutions, although complex. These will be for a future discussion.

As long as real estate is disconnect­ed from the local economy, it doesn’t matter how much new stock we build — it will be beyond what most can afford.

 ??  ?? A 2014 report claimed Vancouver has enough capacity in zoning and city planning to accommodat­e 20 years of housing demand.
A 2014 report claimed Vancouver has enough capacity in zoning and city planning to accommodat­e 20 years of housing demand.

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