The high cost of homes in BC has probably been among the most critical issues facing residents for decades, and according to one group, it’s doing major damage to the economy.
A Canadian Centre of Policy Alternatives (CCPA BC) report says non-profit housing, renter protections and rent controls are needed, among other critical tools.
“Expensive housing is eroding the core of BC’s economy,” said Senior Economist Marc Lee.
“In recent years, speculative behaviour from real estate investors has been top of mind as home prices rise beyond the reach of many households,” Lee added.
CCPA BC is also calling on the government to reform property taxation.
The report states, “Sarce and expensive housing is eroding the province’s economy, and the skyrocketing price of homes [has] become a source of enormous wealth inequality.”
One of the main recommendations from the CCPA BC is public and non-profit housing. Lee and fellow economist Alex Hemingway say they’re needed to deliver “genuine affordability in the short run” and “maintain affordability over time.”
“In the context of a housing shortage, allowing new non-market and market rental apartments is crucial, particularly in the large areas of cities currently reserved exclusively for low-density housing,” Hemingway said.
To meet the demand for housing, BC faces a seemingly insurmountable task.
“Canada Mortgage and Housing Corporation estimates that BC needs to build 610,000
more homes by 2030 above current building trends,” the report states.
“In Metro Vancouver, vacancy rates around 1% have prevailed for more than a decade with the brief exception of the 2020 COVID-19 shock. In comparison, housing experts generally see a healthy vacancy rate as 3% to 4%, which would represent a more balanced housing market.”
There are other problematic realities Metro Vancouver and BC renters have to deal with.
For example, BC does not have an official rent control policy, meaning that once a unit is vacated, the presiding landlord or owner can jack up the rent to whatever amount they want.
“In BC, a lack of security of tenure has been a significant challenge for renters in recent years, particularly those living in secondary suites and rented condos. To better protect renters, we recommend vacancy control to limit rent hikes between tenancies, which would tie rent controls to the unit and not to new renters, as is the current practice,” the report explains.
BC does have a rent increase cap, and the 2025 cap was announced recently, but that cap applies only to occupied units.
The report also outlines how non-profit housing could address the rental crisis in BC.
“Shifting from for-profit to non-profit projects can lower break-even rents in non-market developments by removing the developer/landlord profit margin.”
One recommendation is to address the reality many renters have faced when they’re forced to move due to redevelopment. This would entail adding more protections and rights for renters.
CCPA BC also believes that more taxation is needed to address “ballooning land wealth.”
Do you agree with the CCPA’s recommendations?