From Ken Ohrn:
Another piece of the discussion about housing prices in Vancouver. The City of Vancouver hired consultants Coriolis to report on CACs (Community Amenity Contributions*) and their effects.
To quote the conclusions:
There is no compelling evidence that CACs have constrained the pace of apartment development in Vancouver or contributed to increasing housing prices. The City absorbs over a third of all new apartments in the region, which is remarkable considering the large number of high density urban nodes under development across Metro Vancouver.
Nor is there evidence that CAC policy has constrained the pace of rezoning. Rezonings are adding development capacity at a rapid rate and the City has capacity for more than 20 years of development. CAC rates generally leave considerable financial incentive for land owners and developers.
Housing prices are high and rising in Vancouver because there is strong demand from many sources including local households wanting affordable homes, affluent households shifting into apartments from single detached units, and non-local buyers.
The City’s CAC policy is not restricting development. In fact, CACs have been associated with a large increase in the City’s capacity for new development, have paid for amenities that otherwise would have been funded by property taxes, and in some cases have created affordable housing units. CACs are not the cause of rising housing prices in the City of Vancouver.
The report is dated June 2014.
*Community Amenity Contributions and Development Cost Charges.
CACs are negotiated by the City where a rezoning would result in a significant increase in the value of the land. The City then receives a percent, usually large, of that increase for public benefits. Development Cost Charges are a flat fee calculated on the size of the development for amenities in the district zoned for that particular DCC requirement.
.So why will the Province require a listing of the CACs and DCCs, as well as any other municipally imposed levy, on the cost of a house or condo? Presumably because it makes local government the bad guy. Disconnect the immediate charge from what the money will provide in the away of collective goods – the parks, the arts and community centres, the non-market housing – and then let the animosity build. Hey, it worked for the transit referendum. Read more »