Key to B.C. housing affordability is having enough supply to match demand

The COVID-19 pandemic has altered the needs of B.C. families, as homes have suddenly become a workplace, a school, an entertainment centre and a refuge. Now more than ever, B.C. families need access to affordable homes that can suit their rapidly changing needs.

BC Real Estate Association Chief Economist Brendon Ogmundson notes, “in spite of the COVID-19 induced recession, B.C. home sales are approaching record levels, and prices are climbing, providing a needed boost to the province’s economic recovery. However, elevated demand for homes is brushing up against limited supply, further straining already challenging affordability.

“These challenges are especially acute for lower-income households who have been most impacted by the COVID-19 recession.”

To provide people with more options for affordable housing, BCREA recommends the following actions for the next government: 

Streamline supply by improving the approvals process

The speed at which housing supply can react to increases in demand is a significant factor in determining prices. And while one might think that this only affects the cost of new units, it’s important to remember that housing markets are connected. As new supply comes online, resale-housing units are often added to the market, helping the market stay in balance and keeping prices stable.

The problem is that it currently takes an excessive amount of time for new housing supply to be approved. This translates to depressed resale supply levels and consequently puts upward pressure on home prices when demand rises.

Thankfully, there are solutions.

One year ago, the provincial government released the Development Approvals Process Review Report, the culmination of a nine-month effort to identify the challenges, roadblocks, hurdles and red tape that cause undue delays in the approval of new developments. This report essentially lays out a ‘roadmap’ to address these issues. BC Real Estate Association strongly calls upon the next government to implement as many of these initiatives as possible so that people can get the housing they so desperately need. 

Encouraging developers to target the “missing middle”

Many of those seeking appropriate housing are frustrated by the scarcity of choice, be it location, size, building type or price. 

One solution would be to create ‘gentle densification’ opportunities in single-family neighbourhoods, which make up the vast majority of residentially zoned land in most cities and towns in BC.

By amending single-family zoning to allow a wider array of housing forms, and doing so without requiring a costly and time-consuming rezoning process, we could see thousands of new family-friendly units. These ground-oriented housing units in neighbourhoods already have all of the necessary community infrastructures in place. BCREA recommends that the next government work closely with municipalities to create incentives for the rapid deployment of missing middle housing.  

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