Housing Starts Decline 40% as Govt Fees Rising

According to CMHC, 2024 has started with a 40% decline in Greater Victoria housing starts year to date January – February. The total is 457 in 2024 vs 763 in 2023.

So far this year, there are 369 units from large multi-family projects, 42 single family and 46 townhomes, duplex, etc also known as “missing middle.”  There has been a big shift to large multis due to high construction costs, government fees, taxes and regulations, and high interest rates. Monthly housing data will be skewed based on the timing/appearance of these large projects.

Most of the new housing was in Langford (128), Colwood (116) followed by Saanich (78), View Royal (69) and Sooke (44). Municipalities posting zero starts this year are Central Saanich, North Saanich, Highlands, and Metchosin. Sidney, Victoria and Esquimalt have 6 new units each. Oak Bay has 4 and they are considering a blasting bylaw that will add up to $10,000 in additional unnecessary costs per home. We may be seeing more regulations and fees added by municipalities in efforts to thwart the province’s legislation mandating more housing. Fees ranging from soil testing to DCCs to new building code regs continue to increase putting housing further out of reach for young families.

The BC government recently announced mandatory rezonings and housing targets for some municipalities, however they also increased Development Cost Charges by including police & fire stations, sold waste treatment facilities and highways in addition to the already covered sewer and water, sidewalks, parks, etc. Previously negotiated Community Amenity Contributions were legalized like DCCs, and this will also add costs to housing. The CRD plans to add water charges of $9,045 per new single family home and $7,914 for townhomes, duplexes etc of which there is already a shortage. More charges will be applied to large multi-family projects. There needs to be a cap on rising fees and regulations.

In addition, the BC government announced a new program called BC Builds, however these programs are ineffective at addressing market housing supply and affordability for the general population.

They should start by changing the Property Transfer Tax from a tax to a title transfer fee like Alberta.