ADDRESSING B.C.’s HOUSING CRISIS & HIGH DEVELOPMENT COSTS (2026)

Issue

B.C. faces a sustained housing affordability crisis characterized by rapidly rising housing costs, constrained supply, and elevated development fees that pose barriers for developers and potential homeowners/renters alike. Despite proactive municipal initiatives, systemic cost pressures, particularly high developer levies and carrying costs, limit housing construction and affordability.[1]

Background

Housing demand is driven by population growth, immigration, and regional economic attractiveness. Market housing costs (rent and ownership) have outpaced income growth, making affordability a central issue for workers, families, and employers.[2]

Elevated Development & Municipal Fees

• Development Cost Charges (DCCs), Amenity Cost Charges (ACCs), and permit levies in B.C. are among the highest in Canada relative to other municipalities, increasing per-unit construction costs significantly.[3] These costs are often well beyond inflation and typical construction-cost escalation. In many cases, the magnitude of the increases is significant, particularly in a province with a long history of coordinated regional and urban planning.[4]
• These fees are designed to fund infrastructure (parks, water/sewer, community facilities), but they substantially add to the upfront costs developers must bear, reducing project feasibility and discouraging new supply.

Upfront Financing Burdens

• Developers in B.C. currently must pay significant charges early in the project lifecycle, tying up capital and increasing financing costs. Even with provincial changes to payment timelines, challenges persist.
• The cost of compliance with municipal fees and time-consuming approvals also act as material barriers.

From a provincial point of view, B.C. has adjusted payment timelines for development fees to lower upfront barriers, letting developers pay a smaller portion at permit issuance and the rest over several years. The B.C. Builds program provides low-cost financing and leverages underused land to accelerate middle-income housing.[5]

From a federal perspective, Housing Accelerator Fund (HAF), offers incentives to municipalities that streamline approvals and accelerate housing supply.[6] In addition, new federal commitments include significant low-cost loan programs (e.g., Apartment Construction Loan Program) and the Build Canada Homes agency aimed at reducing construction risk and catalyzing affordable housing.[7] Moreover, Budget 2024 proposed a Canada Housing Infrastructure Fund to support critical services needed for new housing construction.[8]

Fee Structures Still Pose Cost Pressures

• Even with timing changes, the cumulative burden of municipal and regional development fees is high and continues to add hundreds of thousands to per-unit costs.[9]

Insufficient Non-Market and Deeply Affordable Housing

• Federal and provincial support for non-market housing is significant but still falls short of meeting actual need, especially for low-income households. Furthermore, projections suggest federal programs may shrink without policy renewal.[10]

Zoning & Planning Barriers

• While not as sticky as in some jurisdictions, rezoning delays and municipal processes still affect timelines and costs, especially for mid-rise housing. Appeals can take months or years, adding carrying costs.[11]

The Chamber Recommends

That the Provincial and Federal Governments:

1. Work with municipalities to reform development charges and fee structures tied to housing starts to incentivize new construction and development avoiding a “one-size-fits-all” model.
2. Incentivize municipalities to introduce digital application systems, guides to standardize approvals and facilitate better coordination and scope alignment between utilities and agencies.
3. Develop Infrastructure funding beyond DCCs by investigating alternative regional infrastructure funds so that municipalities can look beyond DCCs as the primary funding source for growth-related infrastructure. It is encouraging to note that the province is starting to move in this direction through proposed legislative amendments to establish new eligible project categories that municipalities could apply to reduce DCCs.[12]