{"id":15006,"date":"2020-03-02T10:10:00","date_gmt":"2020-03-02T18:10:00","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=15006"},"modified":"2020-02-20T11:43:16","modified_gmt":"2020-02-20T19:43:16","slug":"midst-construction-delays-in-development-approvals-factors-in-bc-housing-starts","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2020\/03\/midst-construction-delays-in-development-approvals-factors-in-bc-housing-starts\/","title":{"rendered":"Midst Construction &#038; Delays in Development Approvals Factor in BC Housing Starts"},"content":{"rendered":"<p style=\"text-align: justify;\">The province expects a precipitous drop in housing starts this year and another slip in 2021, but housing experts warn that is no indication demand for housing has dropped off or that homebuilders are about to down tools any time soon.<\/p>\n<p style=\"text-align: justify;\">Busy construction crews, housing supply in the midst of construction and delays in development approvals at the municipal level are among the factors at play in forecasts that suggest housing starts will fall to 35,021 this year in BC from 44,932 last year.<\/p>\n<p style=\"text-align: justify;\">Budget documents released Tuesday showed starts are expected to slip to 32,040 in 2021 and 30,515 in 2022.<\/p>\n<p style=\"text-align: justify;\">\u201cWhen you talk about a dropoff, remember you\u2019re talking about coming off a peak,\u201d said Braden Batch, senior market analyst with Canada Mortgage and Housing Corp. \u201cYou\u2019re still at pretty much record amounts of units being constructed at this moment.\u201d<\/p>\n<p style=\"text-align: justify;\">The historical average between 1990 and 2018 is just over 30,000 units annually in BC.<\/p>\n<p style=\"text-align: justify;\">In Victoria, CMHC has forecast a slight drop in starts this year from the 3,499 housing starts last year, which was also a drop from the 4,273 recorded in 2018.<\/p>\n<p style=\"text-align: justify;\">This year, Victoria is likely to see anywhere between 2,341 and 3,768 new homes started, and between 2,723 and 4,099 in 2021.<\/p>\n<p style=\"text-align: justify;\">Batch said most of the new starts in Victoria tend to be large developments of condos and rental apartments that require years to complete.<\/p>\n<p style=\"text-align: justify;\">\u201cSo, often when we\u2019re reporting on starts, it doesn\u2019t reflect the amount of construction that\u2019s present,\u201d he said, adding there is only so much capacity in the construction industry to handle new projects. \u201cAnd no one knows 100% what the effect of all those new units on the market will be.<\/p>\n<p style=\"text-align: justify;\">\u201cDevelopers are cautious before they initiate new units.\u201d<\/p>\n<p style=\"text-align: justify;\">But Casey Edge said there\u2019s more to a drop in starts than a lack of capacity to take on new jobs.<\/p>\n<p style=\"text-align: justify;\">The executive director of the Victoria Residential Builders\u2019 Association said the province and municipal governments have to shoulder some of the blame.<\/p>\n<p style=\"text-align: justify;\">\u201cWe are seeing a decline in housing starts despite the fact we have very strong population growth,\u201d he said. \u201cWe need to accommodate this with new housing not less housing.\u201d<\/p>\n<p style=\"text-align: justify;\">Edge said the province promised in 2017 it would improve the supply of housing and work on streamlining the approval processes at the municipal level.<\/p>\n<p style=\"text-align: justify;\">\u201cThat hasn\u2019t been done,\u201d he said. \u201c[The budget] predicts a 24% decline in housing starts over two years, yet they are also predicting population growth. The demand for market housing is there, but they appear to be doing nothing about improving supply for that growing market demand.\u201d<\/p>\n<p style=\"text-align: justify;\">BC\u2019s population is expected to grow by between 57,000 and 60,000 people each of the next four years, while Victoria\u2019s population grows by about 5,000 people per year.<\/p>\n<p style=\"text-align: justify;\">Edge concedes the province has worked to provide new non-market housing \u2014 the province claims it has just over 23,000 new units in progress or complete around the province \u2014 but he said it hasn\u2019t dealt with the main supply issue.<\/p>\n<p style=\"text-align: justify;\">\u201cThis is not a demand problem, this is a supply problem,\u201d he said. \u201cWhen you build market housing people leave their existing homes for new homes, or they buy up in the market. That leaves housing available.\u201d<\/p>\n<p style=\"text-align: justify;\">He said nothing has been done about streamlining approval and permitting processes for housing at the municipal level.<\/p>\n<p style=\"text-align: justify;\">\u201cAnd that\u2019s because the BC government has no authority over municipalities,\u201d he said.<\/p>\n<p style=\"text-align: justify;\">\u201cThree levels of government treat housing as a cash machine [GST, property transfer tax, development cost charges, fees and required amenities],\u201d Edge said, noting because they can\u2019t influence the processes of municipalities the \u201cpromises by the provincial and federal governments to increase supply and permit approvals are just a lot of hot air.\u201d<\/p>\n<p style=\"text-align: justify;\"><a href=\"https:\/\/biv.com\/article\/2020\/02\/housing-start-drop-not-due-demand-cmhc\" target=\"_blank\" rel=\"noopener noreferrer\">CMHC : Housing-Start Drop Not Due to Demand<\/a> by Andrew Duffy | Times Colonist | BIV<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The province expects a precipitous drop in housing starts this year and another slip in 2021, but housing experts warn that is no indication demand for housing has dropped off &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2020\/03\/midst-construction-delays-in-development-approvals-factors-in-bc-housing-starts\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[],"class_list":["post-15006","post","type-post","status-publish","format-standard","hentry","category-market-updates"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Midst Construction &amp; Delays in Development Approvals Factor in BC Housing Starts &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2020\/03\/midst-construction-delays-in-development-approvals-factors-in-bc-housing-starts\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Midst Construction &amp; 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