New Vancouver Housing Strategy Promises 72,000 New Homes Over the Next Ten Years

Vancouver City Council voted affirmatively on November 29 to integrate a new major housing strategy. The strategy tackles necessary issues important to the integrity of Vancouver’s economy and growth in addition to revitalizing low-density neighbourhoods, addressing homelessness to taming real estate speculation and growing rental housing inventory.

Mayor Robertson’s release stated “Housing Vancouver builds on measures the City is already taking that are the first of their kind in Canada — the empty homes tax, temporary modular housing for our most vulnerable residents, and regulating short-term rentals — and includes strategies that go after real estate speculation, offer more protection for renters and will transform single-family neighbourhoods across the city. This comprehensive approach will help us maintain Vancouver’s diversity and vibrancy, and create more affordable housing options for young people, growing families, seniors and our most vulnerable residents.”

The plan has already outlined action for the next 6 months, including:

• Moderate Income Rental Housing Pilot Program
• Renter protection manager hired
• Social Purpose Real Estate Incentive Program
• Affordable housing delivery and financial strategy to Council
• Launch tactical response team to introduce new housing options in low density neighbourhoods
• Community amenity contribution policy amendments for rental housing
• Bylaw amendment for collective housing
• Design competitions – Laneway Housing Review and Innovation Challenge
• Moving Rate of Change trigger from six to three to increase protection for rental housing

Beyond that, the three year focus has four major priorities:

1. Addressing the cost of land and its impact on the housing industry
2. Supporting renters and vulnerable residents
3. Transformation of single-family neighbourhoods to increase supply and affordability
4. Working to streamline the building and development process

With a goal of 72,000 new homes to be delivered over the next ten years, the strategy is precise in allocation in that:

• 50% of new homes will serve households earning less than $80,000
• 29,000 will be for families, representing 40% of all new homes
• Two thirds of all new housing will be for renters
• 12,000 will be social, supportive and non-profit co-operative homes and of those 4,100 will have supports
• 20,000 will be secure long-term market rental homes
• 4,000 new laneway homes will provide ground-oriented homes for couples and families
• More ownership options will be available for first time homebuyers, families, and downsizing seniors

Beyond this, the provincial government already implemented the foreign buyer’s 15% tax earlier this year and now the empty homes tax will see its first declarations due on February 2, 2018. Under the bylaw, secondary homes that did not find a renter by July 1st, 2017 will be subject to 1% of the property’s assessed taxable value. Non-declaration will result in a $250 fine plus the automatic 1% as a result of being deemed vacant. False information carries a $10,000 fine and the city’s new auditing team will work to enforce it including demanding proof like driver’s licenses and income tax information.

Whether this new tax, the first of its kind in Canada, has any major bearing will remain to be seen. Mayor Robertson seems to think so with his comments that “the tax could free up as many as 25,000 empty units for rent. This is a way, an incentive, to get people renting their homes if they’re not using them. We need to do everything we can to get more rental housing available for people in Vancouver.”

On the coattails of this was a proposal in the housing strategy that Jean Swanson, an independent party candidate who finished second in October’s by-election, noted was close to one of her campaign focuses—a “mansion tax” or a surcharge on the city’s most expensive properties.  While the strategy called it “applying differential property tax rates on residential properties,” she noted that in its core, it could function the same as her proposed tax. It would require senior levels of government working together on this and other strategy components like a flipping tax, a speculation tax and/or restrictions on property ownership by non-permanent residents.

The housing market has been pretty exciting these last few years. It will be interesting to see if the City can truly deliver on their plan/goals and the effect on the housing and real estate market should be equally exciting if not polarizing.

Sources:

Vancouver considers banning foreign buyers amid ‘perfect storm’ in housing market

City of Vancouver Housing Strategy

Vancouver council approves ‘bold, ambitious’ 10-year housing strategy

Vancouver readies homeowners for empty homes tax

Housing Vancouver provides a strong foundation for the future in Vancouver

*You should always obtain proper professional advice if you are considering purchasing or selling residential real estate in Vancouver. The opinions expressed on my blog are entirely my own. You assume full responsibility for the use of information provided here. The information presented is subject to change and may not always be accurate due to changing market conditions. The information should not be relied upon as legal or financial advice. I disclaim liability for any damages or losses, direct or indirect, that may result from use of or reliance on information contained in the blog.