Governments and non-profits urged buy more land rather than build more housing units

Nov. 15, 2021

"The City of Vancouver has added more housing units per capita than any city in North America over the last 30 years yet housing prices have increased faster in Vancouver than any other North American city." — Patrick Condon

Housing advocates are expected to urge government officials to devote more effort to acquiring land for affordable housing rather than just building affordable housing units during a three-day conference starting Monday.

B.C.’s housing minister, David Eby, and his federal counterpart, Ahmed Hussen, will take part in the conference, hosted by the three most powerful affordable housing organizations in the province: the B.C. Non-Profit Housing Association, the Co-op Housing Federation of B.C. and the Aboriginal Housing Management Association.

The CEO of the Co-op Housing Federation of B.C, Thom Armstrong, said the province’s $7 billion dollar plan to create 114,000 affordable housing units by 2028 is “the most comprehensive in the country.”

But he said the skyrocketing value of land is the largest impediment to affordability and that is why Armstrong plans to lobby Eby to create a land trust.

“This capital fund would allow the community housing sector to purchase properties, move them into the non-profit or co-op sectors and let them become permanently affordable units rather than flipped as someone’s real estate asset.”

A professor at UBC’s urban design program, Patrick Condon, said the belief among governments that increasing housing stock will increase affordability is misguided.

“The City of Vancouver has added more housing units per capita than any city in North America over the last 30 years yet housing prices have increased faster in Vancouver than any other North American city,” he said.

“In theory, adding new housing supply should reduce prices but the empirical evidence does not support that.”

Armstrong said having access to a capital fund could help dampen speculation in rental properties that were built during the 1970s and are now in need of major repairs or redevelopment.

“The older stock of purpose-built rental housing in B.C. is being quickly bought up by real estate investment trusts, pension funds and housing investors and the first casualty of that is affordable rents,” Armstrong said. “So for every affordable rental unit we build, we are losing three existing purpose-built rental properties.”

Condon said rezoning leads to speculators immediately buying up the surrounding land. He said the city could dampen that by using its community amenity contribution program to impose an 80 per cent tax on the increased value of the land.

“That means the landowner gets some benefits of the land lift, but not all of it. It allows the city to spend the community amenity money on affordable housing,” Condon explained.

“Unfortunately, the federal and provincial governments appear to have no clue this device is available.”

The newly minted federal minister, Hussen, is planning “a major housing-related announcement” in Vancouver within an hour of his appearance at the conference.

Armstrong hopes the announcement will indeed be “major.”

“B.C. has not received its fair share of federal funding. The programs designed in Ottawa work pretty well in Ontario and Quebec, but we have run into problems here,” he said. “We need a more flexible commitment from the feds to realize the full intent of those programs.”

Condon is less hopeful that will happen. He said governments have done little to curb land speculation.

“Provincial and federal housing initiatives are focused on increasing supply on the one hand and also providing some support for first time homebuyers to get into the market,” said Condon.

“But that has the negative consequence of new buyers becoming just one more player on the field of people looking for urban development land, and they end up being another contributor to the inflationary spiral in urban land prices.”

The City of Vancouver reported 1,326 social and supportive housing units were approved last year. The leaders of the affordable housing conference want to that timetable accelerated but do not expect to see it happen before the next provincial budget is presented in February.

[Top photo: Co-op Housing Federation of B.C. executive director, Thom Armstrong, said B.C.'s $7 billion dollar plan to create 114,000 affordable housing units by 2028 is "the most comprehensive in the country." PHOTO BY JASON PAYNE /PNG]