Developers urge Metro Vancouver Regional District to reverse 2026 building fee hikes amid fragile housing market conditions
Metro Vancouver Regional District is facing renewed pressure from major homebuilders to reverse its Development Cost Charge (DCC) hike on Jan. 1, 2026, as major real estate developers warn the higher fees risk further undermining new housing construction during an already fragile market.
In a Jan. 12, 2026, letter addressed to the regional government’s board of directors, comprising the region’s mayors and city councillors, Zenterra Developments president Rick Johal said the phased increases will significantly raise construction costs at a time when home sales have fallen to historic lows.
DCCs are building development fees paid to the regional government to help fund infrastructure, including new and improved sewage treatment and drinking water infrastructure, which are the regional government’s largest multibillion-dollar cost pressures. Developers pay DCCs not only to the regional government but also to separate DCCs — also known as Development Cost Levies (DCLs) in some jurisdictions — to municipal governments and TransLink.
- You might also like:
- B.C. government expands relief from Metro Vancouver Regional District's development fee hikes
- Metro Vancouver Regional District approves operating budget with reduced fee increases
- Metro Vancouver sewage treatment plant project budget cut by nearly $4 billion
- Temporary 20% cut in building development fees approved by Vancouver City Council to help save housing projects
- City of Vancouver unveils sweeping rescue plan to prevent widespread housing project cancellations
- 'At a reckoning point': City of Vancouver to defer fees paid by developers to prevent new housing slowdown
- Opinion: Cities are creating regulations that don't make housing feasible
- Opinion: Metro Vancouver cities are choking off housing supply while blaming everyone else
Johal highlighted that the increases have raised regional DCCs for a typical condominium unit by about $14,000 by 2027, noting that “in 2025, the region recorded its lowest home sales volume in more than two decades” — based on newly released annual performance data from Greater Vancouver Realtors and Fraser Valley Real Estate Board. He asserts that proceeding with these hikes “risks exacerbating an already difficult situation.”
He contrasted the regional government’s approach with actions taken by several local municipal governments, writing that “many municipalities across the Lower Mainland, including the City of Surrey and Township of Langley, have taken proactive steps to freeze, or even reduce, their development fees.”
In an attempt to save projects from cancellation, in December 2025, the City of Vancouver also green lighted a sweeping package of rescue measures, including a temporary 20 per cent reduction in DCLs rates city-wide and a wide range of policy relaxations — building on other measures approved earlier in 2025 to temporarily defer DCLs and community amenity contributions (CACs), enabling a more flexible payment schedule.
Johal warned that the regional government’s fee increases would eliminate any opportunity for builders to lower prices to stimulate demand, adding, “Instead of homebuilders being able to reduce our prices accordingly to encourage sales activity, those savings will be stripped away by Metro Vancouver.”
Furthermore, he pointedly asked, “Is the homebuilding industry being forced to pick up the tab resulting from mismanagement by government bureaucrats at Metro Vancouver?”
In October 2025, in response to the cost pressures, the regional government’s board of directors announced the new Iona Island Wastewater Treatment Plant project would see its construction budget slashed by $4 billion. By reusing parts of the existing plant and deferring components not deemed to be immediately necessary, resulting in a less ambitious and complex plant design, the project’s cost has decreased from $9.9 billion to about $6 billion.
Johal is calling for the regional government’s DCCs to be frozen at 2024 rates, while a further review is performed to better balance the regional government’s fiscal objectives and the impacts on new housing supply.
Similar concerns were echoed in a separate Jan. 12, 2026, letter from Polygon Homes executive vice president Robert Bruno. He warned that the scheduled DCC increases come as many projects are becoming financially unviable due to weak market conditions.
“Pre-sales are difficult, if not impossible in many markets, at the prices required to enable development. Many development projects across Metro Vancouver are no longer viable due to the challenging combination of increasing costs and market softness,” wrote Bruno to the regional government’s board of directors, warning that further cost pressures would result in “additional job losses and a decrease in the number of new homes delivered in an undersupplied market.”
Bruno also pointed to broader policy shifts, including the federal government’s reduced immigration targets and new federal infrastructure funding programs, arguing that these changes should be considered before further DCC increases take effect. He urged the regional government to reverse the newly implemented 2026 increase while governance issues are addressed, writing, “We urge the board to reverse the January 1, 2026 rate increase on all DCC categories, suspend all upcoming fee increases and commit to work with the development community in a collaborative manner.”
Both letters call on the regional government’s board of directors to reconsider the timing and scale of the DCC increases, warning that proceeding as planned could further stall housing construction at a time when affordability and supply remain pressing regional concerns.
Moreover, ever since the phased, multi-year schedule of hikes was approved, developers and other critics have lamented that the regional government’s substantially increased DCCs would essentially offset the benefits provided by some municipal governments that have cut fees, as well as by federal and provincial housing programs. This was also a major sticking point for the federal government.
The regional government’s Jan. 1, 2026 (Step 2) increase over Jan. 1, 2025 (Step 1) results in a broadly similar year-over-year impact across all sewerage areas. For residential lot units, the increase ranges from roughly $6,900 to $7,300 per unit, while townhouse units rise by about $6,200 to $6,600 per unit and apartment units by approximately $4,300 to $4,600 per unit. Non-residential development increases by about $3.30 to $3.55 per square foot. While exact amounts vary slightly by sewerage area, the magnitude of the 2025-2026 increase is consistent across the region.
Further major increases to the regional district’s DCCs are planned for Jan. 1, 2027 (Step 3).
Total regional Development Cost Charges (DCCs) from 2024 to 2027. (Metro Vancouver Regional District)
- You might also like:
- B.C. government expands relief from Metro Vancouver Regional District's development fee hikes
- Metro Vancouver Regional District approves operating budget with reduced fee increases
- Metro Vancouver sewage treatment plant project budget cut by nearly $4 billion
- Temporary 20% cut in building development fees approved by Vancouver City Council to help save housing projects
- City of Vancouver unveils sweeping rescue plan to prevent widespread housing project cancellations
- 'At a reckoning point': City of Vancouver to defer fees paid by developers to prevent new housing slowdown
- Opinion: Cities are creating regulations that don't make housing feasible
- Opinion: Metro Vancouver cities are choking off housing supply while blaming everyone else