Housing Solutions Research from Canada, US & Abroad

CANADA:

Our housing shortage is made clear by the new research confirming the only two Metro Vancouver municipalities that met or exceeded their Metro Vancouver Regional Growth Strategy targets were Richmond and the City of North Vancouver. (Infographics courtesy of HAVAN, October 2019)

 

 

• The  International Monetary Fund (IMF) offers research-based advice to Canadian policy makers (June 2019).  They’re calling for “The Supply Solution” (p 25 of 71 page report). “To more sustainably address housing affordability, regional and federal authorities in Canada need to work together to develop and implement a comprehensive housing supply strategy.”   IMF recommendations for Canada below.

 

 

 

• Growing Pains: Density, economic growth, sustainability and well being in Metro Vancouver May, 2018 
  -Dr. James Tansey, Executive Director Centre for Social Innovation & Impact Investing, UBC Sauder School of Business, looks at the some of the reasons behind housing affordability.
  

 

 

• Unlocking Supply: Housing Affordability & the Missing Middle, April 2017

-Greater Vancouver Board of Trade (GVBOT) released an expert report on housing affordability solutions. GVBOT followed that report up with another called More Homes, More Choices, in August 2019, recommending more homes around transit with removal of policy barriers and addition of incentives to stimulate more rental homes.

 

 

 

• Andy Ramlo, a demographer and VP, Intelligence at Rennie, addresses the supply shortages and housing myths in his presentation to UDI in 2019. Andrew Ramlo Presentation

 

 

• Reducing government taxes/fees on housing would help affordability. A property tax expert, Paul Sullivan, analyzed a typical new apartment in Vancouver’s Cambie Corridor, finding that 26% of the cost is directly related to rising government taxes/fees/regulations.

 

 

• Through the Roof: the High Cost Barriers to Building New Housing in Canadian Municipalities May 2018  CD Howe Institute looked at the barriers to building homes across Canada and calculated the cost impacts. In Vancouver,  644K represents the regulatory costs associated with building a new single family home in Vancouver.  While the Institute didn’t study multi-family homes, their footnote said they estimated similar challenges. Municipal governments and provinces should enable more housing construction by taking steps such as easing restrictions on developing agricultural land, simplifying and updating zoning bylaws, and reducing development charges.

 

 

• BILD GTA report by Altus Group Sept. 2019 comparing government taxes and fees on homes across Canada and US. The chart below shows the total government charges on a per unit basis applicable to the three development scenarios (low‐rise in Burnaby and Surrey, and high‐rise in Vancouver). The fees for a high‐rise development in Vancouver are greater than the low‐rise scenarios in Burnaby and Surrey.This appears to be due to the significantly higher Development Cost Charges (DCCs) applicable in the City of Vancouver than in Burnaby or Surrey.

 

 

• Federal government’s Canada Mortgage and Housing Corporation (CMHC) underscores Vancouver’s “weak” supply response as a critical driver of housing affordability issues. See page 6.

 

 

• A recent study by GWL Realty Advisors confirms rental home building has not kept up with the need. The report estimated Vancouver needs about 12,000 rental units per year, but is seeing only about 3,400 completed per year.

 

 

• UDI pre-Budget 2020 submission to Provincial Government with incentives and solutions to housing challenges.

 

 

• A North Vancouver homebuilder is now seeking a temporary use permit that would allow it to fast-track the affordable units so none of the current residents at the townhouse complex are forced out of the community. North Van developer proposes modular housing for those displaced by demolition

 

 

• New market rental housing project breaks ground in Coquitlam/Global NEWS
  Abdul Jiwan of Redbrick Properties, the project’s builder, said the long wait for new rental housing in Coquitlam has been broken thanks to fresh incentives from the city. “Decades ago there was a tax incentive (for builders) to produce rental housing,” he said, adding zoning bylaws had favoured condos in the meantime.

 

 

• New Westminster planners earn accolades for city achievements
  The city was a Silver Winner in the Excellence in Planning Practice – City and Urban Areas for its New Westminster infill housing program, which included work to implement laneway and carriage houses, and infill townhouses and rowhouses. Winners in this category highlight the inventive ways that planners are creating transformative change through ground-breaking actions.

 

 

• The Impact of Land-Use Regulation on Housing Supply in Canada July 2016-Fraser Institute
  The study compares growth of housing stock between 2006 and 2011 with five measures of land-use regulation—approval timelines, timeline uncertainty, council and community impacts, costs and fees, and the prevalence of rezoning—as well as a summary index of these measures. More regulated districts tend to grow less.

 

 

• Provinces and municipalities key to avoiding housing bubble-by Vincent Geloso Visiting professor, Bates College
  The factors that affect the supply of housing are largely controlled by provincial and municipal governments. Zoning laws, construction building codes, regulations of construction trades all fall under the jurisdiction of these governments. All of these things control the degree to which it’s easy or difficult to build.

 

 

• Policy tools to stimulate rental building and help housing affordability-Landlord BC & UDI
  These proven policy tools that include incentives, tax rebates and zoning, will result in more rental homes being built. Landlord BC also released a white paper in April 2019 that showed how the lack of rent controls spurred more rental homes over the decades.

 

 

• Time to Rethink the Affordability Puzzle 2019-Price Waterhouse Coopers Canada
  Contributing to the challenge is the fact the actions taken so far have addressed the demand issues but not the real issues on the supply side. Until governments change land development process, including the time required to get entitlements, the supply of new housing won’t meet demand in major cities and affordability won’t be brought under control.  A common refrain across Canada was how hard it is to deal with municipal bureaucracy to get new supply on the market in a timely manner. Government development charges, taxes and levies are also a significant factor in the cost of home ownership.

 

 

• The Province News  recently compared the housing crisis responses between Metro Vancouver and Seattle.
  “But while Metro Vancouver looks to demand-management tactics, punitive taxes and government spending to ease the rental housing strain, another city has looked to the private sector for relief. Across the border in Seattle, there has been a rental housing building boom, resulting in a happy scenario for prospective tenants — landlords competing against each other for their business. “In some parts of the city, up to 90 per cent of new building has been rental,” said Samuel Assefa, director of planning and community development in Seattle, where the vacancy rate is around 10 per cent. With the surplus of suites available, rents in several Seattle neighbourhoods have dropped, while landlords offer incentives like a free month’s rent to move in.

 

UNITED STATES:

• Harvard economist Edward Glaeser:  “Glaeser argues that excessive regulation is destructive of the very essence of urban life—density. Cities thrive on the creativity that occurs when people living cheek by jowl exchange ideas and know-how. Sunbelt cities like Houston have grown because an easy regulatory environment keeps housing inexpensive. To economists like Glaeser, building and zoning regulations are a tax on development. Some level of tax makes economic sense, because construction imposes costs on residents in the form of noise, congestion, and pollution. But overly stringent regulation, often pushed by residents who want to keep out newcomers and protect their property values, can make housing unaffordable for most people.”

 

• Study indicates low-income residents are not pushed from neighbourhoods when new housing is built. We should listen – “A new study by the Upjohn Institute, a Michigan-based, non-profit research organization that examined the impact of new market rental buildings in low-income neighbourhoods in 11 American cities…found new rentals did not drive up neighbourhood rents; in fact, rents were lower up to three years out than they were in comparable neighbourhoods where no development occurred. It also found increases in low-income residents migrating to neighbourhoods where new buildings had been added, belying the notion they would be driven out.”

 

• Supply Skepticism: Housing Supply and Affordability August 20, 2018-Professors: Vicki Been, Ingrid Gould Ellen, Katherine O’Regan, New York University (NYU) Furman Center, NYU Wagner School and NYU School of Law
  This article is meant to bridge the divide, addressing each of the key arguments supply skeptics make and reviewing what research has shown about housing supply and its effect on affordability. We ultimately conclude, from both theory and empirical evidence, that adding new homes moderates price increases and therefore makes housing more affordable to low- and moderate-income families.

 

 

• 8 Reasons Why The Rent Is Too Damn High -Aboubacar Ndiaye
  Affordable housing mandates, which usually require a developer to set aside a small percentage of new units for affordable housing, sound good in theory. But developers simply pass on the cost of the affordable units to other residents, driving up the cost of market-rate rents. And in cities like San Francisco and Washington, D.C., height regulations — which forbid buildings from surpassing certain thresholds in height — make it tougher to create more housing through denser development.

 

 

• What can the city of San Francisco do to spur more housing?
  Unfortunately, due to a variety of factors — rising construction costs, high land value, high impact fees including those from Prop. C (inclusionary housing requirements), and the softening of the rental market — (homebuilders) are applying for building permits at a much lower rate than in the past few years.  This analysis offers five strategies to address the housing shortage, from auditing the building code to reduce costs, pausing the planned increase to inclusionary housing and offering more density bonuses.

 

 

• The Invisible Crisis: A Call to Action on Middle-Income Housing Affordability Jan. 2019
  -Challenge Seattle, an alliance of CEOs from 17 of the Seattle region’s leading businesses and philanthropies, released this study with 15 recommendations on how public and private sectors can tackle the middle-income housing affordability crisis, based on international best practices. Middle income earners are those people communities depends on every day: the people who educate our children, care for us when we are sick, respond to natural and man-made disasters, protect us from harm, fight fires and build our homes and cities. Recommendations include: property tax rebates for multi-family homes, zoning changes to increase density and encourage transit-oriented development; streamlined permitting and relaxed parking requirements.

 

 

• Seattle is building more apartments than just about anywhere, and now 1 in 10 units across the city are sitting empty. Landlords have responded by lowering rents slightly and offering more perks to get tenants in the door.
  -Seattle Times real estate reporter By Mike Rosenberg

WORLDWIDE:

• Netherlands Solution for student and senior housing
  To assist with a shortage of student housing and a decline in funding for nursing homes, a nursing home in the Netherlands allows university students to live rent-free alongside the elderly residents, as part of a project aimed at warding off the negative effects of aging. Similar inter-generational programs exist in Lyons, France and Cleveland, Ohio, according to the International Association of Homes and Services for the Aging. One program that began in Barcelona, Spain in the late 1990s has been replicated in more than 20 cities throughout the country.

 

 

• How Singapore Fixed its Housing Problem, by Bloomberg News.
  Singapore had a severe housing shortage decades ago. But it developed one of the world’s best public housing programs, which has also allowed a huge number of its citizens to buy their own homes. See Video link below.