LandlordBC has previously expressed support for the Province allowing municipalities to pre-zone for rental housing. Currently municipalities are unable to make such a designation. It is our view that rental housing, purpose-built rental housing in particular, is a housing typology that is most desperately needed if we are to address the persistently low vacancy rates in Metro Vancouver, Victoria, Kelowna and other regions of the province. We need to provide more safe and secure rental housing options for British Columbians, and rental pre-zoning could be an important tool to encourage the development of new purpose-built rental housing. However, the devil is always in the details.
On Tuesday April 24, 2018, the Honourable Selina Robinson, Minister of Municipal Affairs & Housing, tabled legislation to permit municipalities to pre-zone for rental housing. As noted above, currently municipalities are unable to make such a designation. In tabling the legislation, Minister Robinson indicated that the changes proposed give local governments the ability to preserve and increase the overall rental supply using local discretion.
“Local governments are on the front lines of the housing crisis and they need solutions that work for them,” she said. “This will prevent rental buildings from being torn down for luxury condos that only a very small number of people can afford.”
The Minister added that the legislation would also empower municipalities to ensure existing rental properties cannot be redeveloped for another use, such as high-priced condos. A local council could designate an entire new building for rental only. Or it could deem just a portion of a new development be required for rental, leaving the remaining mixture of units for sale.
She further added that the power would be optional for local governments to use. A municipal council could not use the rental-only clause to override existing strata rules that limit rentals in existing buildings. The zoning would only apply when that property is redeveloped in the future.
It is LandlordBC’s view that the provincial government’s proposal to allow municipalities to have “rental only” zones can be a helpful policy if implemented in the right way. For example, the introduction of rental only zones should:
- not replace (but supplement) existing municipal rental supply policies to genuinely create a positive environment for the development of new purpose-built rental housing;
- apply to a diverse set of locations and not relegate rental zones to specific areas only – we believe that this proposal could be particularly effective in advancing multi-unit rental housing in areas where it has not been contemplated, such as single-family or industrial zones;
- ensure that existing density bonusing for market rental housing is unaffected. Municipalities must ensure that enough buildable square feet density is granted in rental-only zones in order to: (1) give existing landowners enough “land lift” to incent them to sell – without existing landowners willing to sell to rental developers, it will be a failed policy, and (2) reduce the land cost per buildable square feet, which is the important metric for the economics of development for rental developers;
- reduce or eliminate minimum parking requirements for rental projects; and
- ensure that with the implementation of rental pre-zoning policy, the requisite expediting of project approvals is put in place. Without prompt and efficient approval of purpose-built rental projects, today’s rental housing challenges will persist.
While LandlordBC acknowledges that there’s no guarantee that rental-only zoning will reduce the cost of rental housing, history has shown us that by increasing supply the prices will fall. We need not look any further than Alberta to see the impact of increased supply on rents. Simply put, we need to build more secure, purpose-built rental housing in British Columbia, and LandlordBC looks forward to collaborating with the Minister and cities and municipalities across the Province to help achieve this objective.