BC government to incentivize homeowners to create secondary rental units

BUDGET 2023: BC government to encourage homeowners to create secondary rental suites

Example of a basement suite. (Artazum/Shutterstock)

The provincial government is looking at new ways to expand rental housing supply.

In addition to providing hundreds of millions of dollars to build new secured purpose-built rental housing supply, BC Finance Minister Katrine Conroy announced in her 2023 provincial budget speech today that the provincial government has set aside $91 million towards catalyzing new additional unsecured rental secondary suites to their properties.

This will be a pilot project over three years, with homeowners provided with financial incentives towards developing new secondary suites — with the stipulation of requiring eligible properties to be the property of the homeowner’s principal residence.

Of course, the most common type of secondary suite is a basement unit.

At this time, the provincial government has not provided the framework details for applications and how the financial incentive can be used. More details will be announced at a later date.

This pilot project is expected to catalyze thousands of additional rental housing units across BC.

All types of unsecured rental housing — such as condominiums, as well as basement suites and laneway houses within single-family lots — make up a significant portion of the overall rental housing supply.

Such a pilot project will also help municipal governments reach their new housing supply quotas under the provincial government’s recently approved Housing Supply Act.

For catalyzing more secured purpose-built rental housing, in addition to providing funding for select eligible projects, the provincial government is introducing a new property transfer tax incentive to encourage the construction of such homes.

For the generation of an overall new housing supply of all types, the provincial government is currently forecasting BC’s housing starts — the milestone of starting construction on new housing — to reach about 39,000 units in 2023; 37,000 units in 2024; and an average of 38,000 units annually between 2025 and 2027.