As every homebuyer knows, the purchase of a home is based on numbers.
Financial institutions require a down-payment representing at least 5% to 10% of the price, and an income sufficient to pay the mortgage and other living expenses.
Political spin such as the alleged impact of “foreign buyers” and “speculators” on housing prices are not relevant.
The same is true of the housing market – supply and demand numbers dictate the cost.
Statistics Canada reports the country’s rate of growth is twice as fast as the US and UK. Our population was 37,589,262 in 2019, up 531,497 from 2018, and growth was “highest in British Columbia.”
Today’s housing demand is due to a large millennial demographic starting families, retiring baby boomers downsizing, plus a 55% increase in immigration, “one of the highest numbers in history” according to StatsCan.
Population growth is necessary for a strong economy and new housing is needed to accommodate the growing numbers.
However, the Victoria Real Estate Board reported a 25-year-low in housing inventory for sale in December 2020, continuing into 2021.
Where is the inventory? A big chunk is sitting in Saanich’s development review process.
Saanich has about 200 development applications for subdivisons, multi-family and other projects under review.
In 2019, council held 9 public hearings and reviewed 14 residential development applications/rezonings for approval or rejection. At a rate of 14 items annually, the existing 200 applications will take about 14 years to process.
It’s no wonder that since 2017, Saanich’s housing starts declined by 68%, from 625 to 200. Reducing supply during rising demand is a recipe for rocketing housing prices.
While many municipal politicians claim to support housing, the numbers reveal an overly bureaucratic system undermining supply.
The bottom line is Canada’s population growth cannot be accommodated by outdated municipal processes and government policies choking housing supply.
BC’s provincial and municipal politicians must be accountable for these failed processes and policies, including municipal self-determination promoted today and in the past by all BC governments.
Voters must ignore political rhetoric and focus on the numbers if we are ever going to improve housing affordability.