Vancouver has the steepest City fees for new high-rise housing in Canada

City of Vancouver has the steepest municipal fees for new high-rise residential buildings in Canada

Downtown Vancouver skyline with construction cranes. (Shutterstock)

The City of Vancouver has the highest fees in exchange for the approval of new high-rise residential building construction amongst major Canadian municipal governments, according to a new report by Canadian Home Builders’ Association (CHBA).

The average total cost of the various charges levied within Vancouver on new high-rise housing is $125,542 per unit or $157 per sq ft of unit floor area. This is up by 25% compared to 2020, when average fees were $100,679 per unit, and it includes fees such as development cost levies (DCLs) and community amenity contributions (CACs).

That is nearly $15,000 per unit or $18 per sq ft more than the next highest fees charged by a Canadian municipality — the Greater Toronto suburban city of Markham.

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The City of Toronto has the third highest fees, reaching an average of $99,894 per unit or $125 per sq ft. This is up by 31% since 2020.

Metro Vancouver’s suburban city of Surrey imposes average fees of $48,654 per unit or $61 per sq ft, which is closer to the national combined average of $41,353 per unit or $52 per sq ft for the 20 municipal governments evaluated.

The City of Burnaby’s average fees are far lower than those of Vancouver and Surrey’s, hovering at $19,256 per unit or $24 per sq ft.

But the hikes within Burnaby and Surrey were amongst the highest in the country, up by 54% and 37%, respectively, from 2020.

And in Calgary and Edmonton, the average fees charged by their municipal governments are $16,990 per unit or $21 per sq and $6,599 per unit or $8 per sq ft, respectively.

canada high-rise municipal fees per unit 2022

Municipal Charges per Unit, High-Rise Scenario, Study Municipalities, 2022. (Altus Group Economic Consulting)

CHBA’s analysis and comparison of the 2022 performances of municipal government processes for approving housing were conducted by Altus Group Economic Consulting.

While municipal governments have previously maintained that their fees are intended to capture a portion of the value of growing land values for public benefits and to cover the higher operating and capital costs within urban environments, the CHBA report suggested there may be unintended consequences if this revenue-generation strategy goes too far in one direction by creating an added layer of costs that are ultimately passed on to the homebuyer.

“Higher municipal charges (like escalating construction costs or other costs) increase the price ‘floor’ that units need to be sold at to be feasible to the developing landowner and home builder. If fewer units can sell at prices that cover increased costs, fewer units will get built,” reads the report.

But for average fees for new low-rise residential building construction, the City of Vancouver comes in the middle of the pack, ranking 10th highest out of the 20 municipal governments evaluated.

Vancouver’s municipal government average fees for low-rise residential construction is $61,414 per unit or $28 per sq ft — essentially aligned with the 20-city average of $61,582 per unit or $28 per sq ft. However, this is up by 29% from 2020.

The City of Toronto tops the list with the highest low-rise fees, with an average of $189,325 per unit or $85 per sq ft, representing a hike of 21% from 2020.

The City of Surrey has the sixth highest low-rise cost — $84,678 per unit or $38 per sq ft, representing a 62% increase from two years ago. But the City of Burnaby is lower than both Vancouver and Surrey, with its fees hovering at $29,533 per unit or $13 per sq ft — similar to the City of Edmontons’s $29,359 per unit or $13 per sq ft. Burnaby and Edmonton’s average fees went up by 43% and 34%, respectively, compared to 2020.

The City of Calgary’s low-rise fees average is $42,800 per unit or $19 per sq ft, representing an increase of 15% since 2020.

“The disproportionate costs per square foot in municipal charges towards high-rise puts at risk municipal objectives for increased infill and intensification. This could hinder utilization of public infrastructure investments in urbanized areas, such as major transit station areas, or transit corridors,” adds the report.

canada low-rise municipal fees 2022 per unit

Municipal Charges per Unit, Low-Rise Scenario, Study Municipalities, 2022. (Altus Group Economic Consulting)

canada low-rise high-rise fee comparison cities 2022

Ratio of Municipal Charges per SF, Low-Rise vs High-Rise Scenarios, 2022. (Altus Group Economic Consulting)

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