Developers have been warning about the current high-cost climate, saying it may put the brakes on new projects and lead to a slump in housing starts.
At a breakfast meeting with the Greater Victoria Chamber of Commerce on Tuesday, Premier David Eby pointed to eight new housing proposals on the B.C. Builds website to illustrate how the government is working to deliver new homes — while also acknowledging the serious challenges facing the development sector.
The B.C. Builds program uses government-, community- and non-profit-owned land, plus low-cost financing and grants, to cut construction costs and deliver affordable homes more rapidly for middle-income residents. In the past several months, the province has unveiled several pieces of legislation aimed at creating more housing, including allowing construction of up to four units of housing on single-family lots and eliminating public hearings for proposals that already meet official community plan guidelines.They rely on construction financing at rates that can be 15 per cent or higher, a “devastating” level for builders seeking loans to put up rental housing, he said.
The sector is dealing with supply-chain challenges, a labour shortage, high land costs, municipal approval delays and interest-rate increases, he said — factors that have “all compounded to create the housing crisis that we as a region are currently experiencing.” The sector is sending out warning signals that housing starts may drop to some of the lowest numbers in a decade, he said.
“There’s kind of a perfect storm developing,” Mycroft said, adding that the province is also making changes to the building code that will add to development costs. Those include the step code, which is designed to make new buildings net-zero energy ready by 2032, and adaptability measures that would require all units to have space for a wheelchair to turn around.
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