Leading Edge: An expanding universe of misleading news

When the BC Step Code was announced several years ago, a reporter said he had to battle to get the story in the newspaper. Apparently, the
subject was considered too complicated for mainstream news.

Which is why publications like Canadian Contractor serve an important role. They try to make sense of complex industry issues. In keeping with this mandate, I have written on topics ranging from Step Code to restrictive zoning bylaws and costs on housing. Canada’s housing industry is a complex, expanding universe of regulations and policies which are almost impossible to track without industry publications like Canadian Contractor. This content is rarely available in the mainstream media and, even if covered, is only partly right due to complexity and sometimes government spin-doctors.

An example is Canada’s misleading national housing price of $679,051 in June. B.C. and Ontario have prices significantly more than $679,051, but six provinces have average prices under $375,000.

Some B.C. municipalities are now fast-tracking, by ten years, the highest level of the BC Step Code – Tier 5 Net-Zero Ready. However, recent data show Net-Zero Ready homes are achieved at Tier 4. This means homebuyers are unnecessarily paying thousands of dollars extra because municipal councils believe Tier 5 is the only way to achieve Net-Zero Ready. Municipal politicians are not qualified to make these decisions, yet they have been enabled by the B.C. government. In doing so, the government misled the public into thinking each tier would be achieved responsibly in steps. BC’s Leap Code only adds to housing costs in the most unaffordable province in Canada.

The second issue involves municipalities demanding Community Amenity Contributions, an added housing cost in many communities across Canada. This is the practice of under-zoning neighbourhoods, to capture revenue for “density bonusing.” In a recent report on housing called Opening Doors, CAC’s were highlighted as an obstruction to affordability. The report says, “Zoning-based charges (CAC’s) discourage proactive zoning for more homes.”

“CACs are negotiated in exchange for rezoning property to accommodate more homes. As a result, local governments that proactively increase zoned capacity or update zoning codes to better reflect anticipated growth and community priorities (as outlined in regional growth strategies and official community plans) lose that revenue opportunity. Indeed, local governments can generate CAC revenue by keeping zoning below levels that make redevelopment possible and selling additional “air rights’” through the zoning powers they have been delegated. Consequently, the additional costs, time, and uncertainty associated with the rezoning process – including their negative impacts on housing supply – persist.”

The report concludes CAC’s should be “phased out.” The challenge is that the B.C. government has a policy of municipal self-determination and the report’s recommendation would require them to step on municipal toes.

The CD Howe Institute previously exposed these regulatory costs as adding an average $230,000 to the price of a home in major cities across Canada.

If sound planning principles suggest a neighbourhood can accommodate a maximum density, then assigning a lower density and calling the higher density a “bonus” is misleading. The practice of “bonus density” adds to rising housing prices.

I have yet to see the recommendation on CAC’s covered in the major media. So, the public has no idea of real housing affordability challenges because it doesn’t suit major media coverage, and the content that is covered is often designed by government spin-doctors with terms like “Step Code” and “density bonus.”

The Victoria Residential Builders Association covers these issues in our blog and our weekly column in a local daily. (vrba.ca/building-industry-news)

But we are one association, and Canadian Contractor magazine can help drill down into these issues to a much wider audience across Canada. Especially when talking about Canada’s expanding universe of misleading housing news and regulations.