BC government orders City of Vancouver to add 29,000 homes over five years

BC government orders City of Vancouver to add 29,000 homes over the next five years

Construction cranes for the original Vancouver Olympic Village neighbourhood in the late 2000s. (Shutterstock)

If the City of Vancouver is going to satisfy the Government of British Columbia’s new housing targets, it will have to catalyze the completion of 28,900 new additional homes over the next five years between October 2023 and September 2028.

That is the “final housing target order” given to BC’s largest municipality today under the provincially legislated Housing Supply Act, which is one of the provincial government’s key policies toward addressing the housing affordability and supply crisis.

So far, the City’s main metric is the number of approvals through its various application and review processes, with its 2017-enacted Housing Vancouver strategy calling for the approval of 72,000 new homes between 2018 and 2027. As of 2022, halfway into the Housing Vancouver timeline, the City has approved 48,114 units or a progress rate of 67% towards the goal of 72,000 new home approvals.

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However, the provincial government’s threshold is based on actually reaching a state of completion, not merely approvals. These must be net new units that are ready for move-in, which subtracts any units lost through demolition.

Moreover, the provincial government has made specific prescriptions on the type of housing that must be built.

For the City of Vancouver, from the target order of 28,900 units, this includes 8,015 ownership homes and 20,886 secured purpose-built rental homes, including 12,992 market rental units and 7,894 below-market rental units.

Within these totals, there are also unit size mix considerations, with the provincial government stipulating 3,001 studio or one-bedroom units, 5,231 two-bedroom units, and 6,209 units with three or more bedrooms.

Another 583 of these units are requested to be supportive housing.

The annual targets for the City of Vancouver over a five-year period have been established at 5,202 units for the first year, 10,597 units for the second year, 16,281 units for the third year, 22,349 units for the fourth year, and 28,900 units for the fifth year.

The City of Vancouver’s target order was part of the provincial government’s announcement today, releasing the target orders of the first 10 municipalities directed to follow the Housing Supply Act.

Other cities include the City of Abbotsford, City of Delta, City of Kamloops, District of North Vancouver, District of Oak Bay, City of Port Moody, District of Saanich, City of Victoria, and District of West Vancouver.

The target order for the City of Vancouver is nearly four times higher than the next highest target order held by the City of Abbotsford, which is obligated to catalyze the completion of 7,200 homes. Within Metro Vancouver, other than the City of Vancouver, the next highest is the City of Delta’s target order of 3,607 homes.

For the full list of the target order for all 10 initial cities under the legislation, click here.

“Vancouver is ready to take the lead on building new housing. We have said getting homes built requires an all-hands-on-deck approach and we are pleased to see clear support from the Province to build the homes that we need to tackle the housing crisis head-on,” said Vancouver Mayor Ken Sim in a statement.

“The City of Vancouver is fully committed to do what it takes to make sure we have attainable housing for everyone who calls our city home.”

Housing targets will be measured by the provincial government after the first six months, then annually by net units completed and actions taken by the municipality to meet the targets.

The provincial government created each municipality’s target housing order based on a formula that takes into account the required supply to address the extreme core housing need, the supply to permanently house people experiencing homelessness, the supply to address suppressed household formation, the anticipated supply needed over the next five years, and the rental supply needed to return the rental vacancy rate to a healthy range of 3%. The targets also amount to a 38% increase in overall housing to be built in each jurisdiction over what was projected to have been created based on historic trends.

Canada Mortgage and Housing Corporation’s (CMHC) data on housing starts — the stage of the start of on-site housing construction — provides another metric of what is in the completion pipeline over the coming few years. In 2022 alone, there were 5,911 housing starts within Vancouver’s jurisdiction, including 3,207 secured purpose-built rental homes, 1,636 condominium homes, and 1,068 unstratified ownership homes.

The housing targets put forward by the Province mark a 38% increase in overall housing to be built in these communities over what was projected to have been created based on historic trends. Moreover, the targets are set at 75% of the higher of the two separate housing needs estimates created by the provincial government and the municipal government.

“Targets involving completion will require the joint effort of the City and the Province to manage factors that are outside many municipalities’ control,” said Paul Mochrie, the City manager for the City of Vancouver.

“These include access to funding and financing for market and non-market developers, high interest rates, increased cost of construction and availability of labour. While municipal governments, including Vancouver, cannot control many of the factors affecting completion of housing projects, we can control approvals and we are focused intensely on simplifying and expediting that process.”

For further breakdowns of today’s Housing Supply Act announcement, click here.

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