Opinion: Metro Vancouver cities choking housing supply while blaming everyone else | Daily Hive

Opinion: Metro Vancouver cities are choking off housing supply while blaming everyone else

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Written for Daily Hive Urbanized by Ian Brackett, Mark Goodman and Megan Johal, who are brokers at Goodman Commercial, which specializes in the sale of rental apartment buildings and development sites in Metro Vancouver. They also publish The Goodman Report.

Every time the Government of British Columbia tries to speed up housing development (as it is threatening to do again with a private member’s bill from BC NDP MLA George Anderson), municipal politicians howl about jurisdictional overreach. And yet they continue to drag their feet while approving policies that all but guarantee housing shortages just around the corner.

Regional and municipal government staff have begun to acknowledge that there are deep problems. At a recent Metro Vancouver Regional District Mayors’ Committee meeting, Canada Mortgage and Housing Corporation (CMHC) and municipal staff delivered a sobering picture of the home building industry: presales are frozen, financing has dried up, construction costs remain stubbornly high, and approved projects are stalling due to reduced viability.

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It is not just condominium housing projects that are suffering — amid falling rents and an uncertain investment market, rental housing developers are feeling the pinch, too. In their latest Housing Targets progress report, City of Vancouver staff noted: “Rental developers have started reporting viability challenges with projects that have yet to secure construction financing or for projects that are in early planning stages.”

Housing starts, a lagging indicator, are about to crater.

Anyone who has been paying attention might think this is an issue to get in front of. If projects are not viable and home building falls off a cliff, it is only a matter of time before we return to plummeting vacancy rates and rising rents and condominium prices.

But many local politicians evidently do not see it that way. After hearing the staff’s presentation about the deteriorating economic outlook, regional district board chair and Burnaby Mayor Mike Hurley shrugged: “I don’t see that there’s anything more that we can do.”

Back in March 2025, at a Goodman Commercial-sponsored forum, Mayor Hurley touted Burnaby’s 25,000 approved homes — as if the approvals themselves were the goal (Burnaby isn’t alone: Vancouver has 28,000 approved but unbuilt homes, and Surrey has another 45,000 with conditional approvals.). “It’s not the municipality,” Hurley insists. “Once approvals are made, how homes actually get built is up to the market.”

Municipal governments may not be able to build the houses, but they can strip away outdated policies — relics of a long-gone boom — that now choke off development. Instead, Hurley and his Burnaby City Council have chosen to make matters worse; in the middle of this year, they allowed the in-stream rate protection on new Development Cost Charges (DCCs) for those stalled 25,000 units to expire. At a time when developers are already struggling to get a shovel in the ground, that raised DCCs by over 900 per cent, adding $23,000 to the cost of every unit.

The pattern repeated in the City of New Westminster, where City staff recently presented third-party data showing that the municipal government’s new development charges and proposed inclusionary housing requirements effectively limit condominium projects to a 12 per cent return, at best. Rental housing projects max out at six per cent. Even if they wanted to take a chance in this highly uncertain market, no developer can get financing at those rates.

New Westminster’s response? Astonishingly, their city councillors directed City staff to increase the recommended inclusionary housing percentage.

And there is more to come. Over the next few months, the regional district’s highly controversial DCC ratchets up again, and in-stream rate protection expires. In the five years between 2022 — when most of these approved projects started towards entitlements — and 2027, regional DCCs will have increased by 952 per cent, adding another $19,000 per unit in added costs.

In Burnaby, that is a 10 times increase, adding a combined $41,000 to every new unit, yet their municipal leadership feels there is nothing more that could be done.

If municipal politicians want to keep this interventionist provincial government out of their lane, approving policies that reduce housing supply is an odd strategy.

Whether by rethinking how we fund community infrastructure or abandoning the failed inclusionary housing experiment, more can and should be done, now, by all levels of government to ensure these approved homes are actually built.

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