Municipal Financing

Key insights:

In November of 2023, the province of British Columbia released their “Homes for People Plan” that drastically reduced zoning and municipal barriers to the creation of gentle density homes. In summary, new legislation requires all local governments in British Columbia to update their zoning bylaws to allow up to three to four units in all single-family zones and up to six units for properties with frequent bus service.

This resource, developed by the province, is intended to help local governments and their community members understand the legislative changes introduced related to small-scale, multi-unit housing (SSMUH).

Note: The information in this tool kit is for guidance only and is not a substitute for provincial
legislation. It is not legal advice and should not be relied on for that purpose.

This Small Housing Guidance Paper examines the viability of redeveloping houses in single family neighbourhoods with more homes on the same property, presenting recommendations that will assist various actors involved in setting financial and cost recovery policies as it relates to new gentle density development.

Key policy considerations explored include:

Enabling Tenure Options (Rental & Ownership)

Allowing individual ownership, or strata-titling, for each home on a lot will encourage more new units to
be constructed versus requiring that a property have a single owner (i.e. the owner rents out the additional units, or all residents share a single mortgage).

Leveling the cost playing field and reducing risk

Constructing multi-unit buildings is more complex and costly than single family homes; by offering standardized designs and simplifying approval processes it is possible to reduce the uncertainty and costs involved.

Building in affordability

Given the small number of units involved in these projects, it is administratively simpler and more financially viable to take any affordability requirements or financial contribution (if required) and combine them for affordable housing on a larger site.

For the comprehensive suite of Small Housing Guidance Papers, check them out in the Toolbox Resource Library. Simply search for “Guidance Paper”.

This Metro Vancouver study investigates the cost of providing infrastructure and services to neighbourhoods with varying residential densities, with the goal of informing municipal planning and regional growth policies for Metro Vancouver.

Key insights:

  • The study emphasizes a complex relationship between residential densities and infrastructure costs influenced by factors like infrastructure age, existing capacity, and the physical landscape of the serviced area.
  • Evidence presented suggests that infrastructure and servicing costs per capita and per unit are significantly higher for houses compared to apartment developments.
  • Increasing density is identified as a potential contributor to lowering housing development and municipal operating costs over time.
  • The study includes a literature review on municipal infrastructure and associated costs.
  • Cost calculations are provided for various factors, including development cost charges, municipal operating costs, property taxes/utility fees, and infrastructure servicing, categorized by housing type.

This report aims to rapidly develop and scale solutions to address some of the main land use policy, project financing and design challenges faced in delivering affordable missing middle housing.

Key recommendations:

  • Reforming zoning bylaws to allow as-of-right development of Missing Middle housing,
  • Reforming current public consultation processes
  • Creating incentive programs and seed funding (via CMHC) for the development of missing middle housing
  • Establishing missing-middle specific building standards and development fees
  • Creating a set of missing middle typologies that can over time allow for replicable approval, design, finance, and construction phases.

A pilot project has been identified in Little Jamaica (Toronto) to test out the proposed affordability framework and housing financial models advanced in this report.

Additionally, a National Scalability roadmap has been created to continue to progress the work of the Missing Middle Lab, through maintaining partnerships, bolstering municipal support, and developing design catalogues and financial incentives.

This report was authored by CMHC & Keesmaat Group.

Opening Doors is the final report from the B.C. – Canada Expert Panel on the Future of Housing Supply and Affordability. The group was established in 2019 to identify actionable recommendations to increase housing supply and improve affordability in B.C.

Key insights:

The report features 23 policy recommendations that can be categorised under 5 broad calls to action, including:

  • Creating a planning framework that proactively encourages housing
  • Reforming fees on property development
  • Expanding the supply of community and affordable housing
  • Improving coordination among and within all orders of government
  • Ensuring more equitable treatment of renters and homeowners.

More granular policy recommendations are detailed in the report also, including:

  • Streamlining approvals processes
  • Increasing transparency on development charges
  • Extending tax advantages to renter households
  • Phasing out some subsidies offered to homeowners

This report from the Town of Collingwood details actions that can be pursued at the municipal level to advance affordable housing from the perspective of a lower-tier municipality.

The Town of Collingwood’s Affordable Housing Task Force advises Council and take leadership action on a broad suite of housing matters, including monitoring and providing recommendations for local planning policies and regional initiatives aimed at enhancing affordable housing options, while also exploring and suggesting improvements for current grant and funding opportunities for various affordable housing development types, including new constructions, renovations, and conversions

Key insights:

  • Redeveloping existing town assets, such as apartment complexes.
  • Updating the Official Plan and zoning bylaws to embrace a variety of housing types.
  • Eliminating parking minimums for multi-unit developments and introducing financial incentives for mixed-use development.
  • Increasing and retaining the supply of affordable housing units, including permitting accessory dwelling units.
  • Allocating staff resources for ongoing oversight of new programs and initiatives.

This report from the Terner Center for Housing Innovation, part of UC Berkeley, highlights barriers faced by developers working in states that have enabled multiple units to be built on traditionally single-family zoned lots.

Key insights:

The report details that Middle Housing delivers many benefits to communities:

  • Increases racial equity in housing and neighbourhood access
  • Providesentry-level homeownership opportunities
  • Creates lower greenhouse gas emissions per household).

The following developer challenges are highlighted:

  • Design requirements need to be flexible/supportive of missing middle housing;
  • Larger projects of 8-12 units need to be permitted to make projects financially viable; that complicated utility and subdivision rules deter small-scale development;
  • Approval timelines need to be more efficient; and that there is currently a lack of traditional financing tools to create a funding package for projects.

Key recommendations:

  • Introducing development code changes beyond zoning reforms, including updating design requirements and assessing current impact fees and utility requirements
  • Allocate dedicated resources to streamline permitting and approval processes
  • Considering more ambitious land use changes, such as increasing the maximum units that can be developed per lot, to help foster increased missing middle housing development.

This CHMC study investigates successful examples of regulatory, planning, and financial initiatives at the municipal level that have helped to overcome obstacles to infill development (including contaminated sites grants, accessory apartment development, and development fee exemption programs).

Each initiative highlights local stakeholders’ responses, the impact of the program on local development, program cost (including staff time allocated), and long-term program evaluation.

The study identifies common success factors between initiatives which include linking intensification to other policy goals (e.g., efficient use of public infrastructure funds), ensuring there is robust public engagement, identifying a policy champion, creating a supportive municipal policy environment, and monitoring program outcomes.

This report has been prepared by Ray Tomalty, Co-operative Research and Policy Services.

Discover the benefits and challenges of Accessory Dwelling Units (ADUs) in small to medium-sized communities in insights from BC Housing.

Key Insights:

Explore the advantages of both attached and detached ADUs, addressing housing shortages and enhancing community vibrancy. Uncover the challenges, including costs and applicability on small lots, that equip small communities with the knowledge to unlock ADU potential for sustainable and affordable housing solutions.

Overcoming Hurdles:

Navigate zoning restrictions and tackle issues like parking and infrastructure. The report provides strategies for effective regulatory and building barrier management.

Best Practices:

The guide concludes with actionable best practices, complemented by implementation options and local case studies, offering practical guidance for communities in areas including:

  • Expand Conditions: Permit ADUs by expanding conditions.
  • Relax Parking Standards: Achieve positive outcomes by relaxing parking standards.
  • Streamline Permitting: Optimize resources with streamlined permitting processes.
  • Waive or Discount Fees: Encourage development by waiving or discounting fees.

For more information on BC Housing, head to their homepage.

Research and writing team:

  • Ray Tomalty – Smart Cities Research Services
  • Dan Wilson – WCS Engagement+ Planning
  • Cheeying Ho – WCS Engagement+ Planning
  • Devarsh Bhonde – Research Support

Key topics explored:

Accessory Dwelling Units; ADU benefit & risks; Conditions supporting ADUs; Common Barriers; ADU Strategies and Practices

Date published: 2021

Infill Development in Edmonton: Strategies for Success brings leaders to better understand how public support is garnered for infill development in residential neighbourhoods and explore strategies that can be transferred to BC communities (including municipal policies and processes, partnerships, resources and engagement tactics/messages).

In this Gentle Density Network webinar from February 2023, learn how the City of Edmonton garnered public support for infill development in residential neighbourhoods, with insights from Nicholas Rheubottom, Executive Director at Infill Development Edmonton Association (IDEA), and Travis Fong, Co-Founder and President of YEGarden Suites.

Key insights:

There are many benefits to infill development:

More diverse housing stock: Infill helps to create diverse and vibrant neighbourhoods by providing options to meet everyone’s needs, whether it be new families, seniors, students, front-line workers, or more!

Financial Sustainability: Similar to above, by creating more diverse housing options, we can also cater for a greater diversity of financial needs and incomes.

Multigenerational Living: Enabling a variety of housing options in a neighborhood provides families with the choice to age in place, allows young individuals to reside nearer to the city center

Amongst the key barriers to infill include:

Infrastructure: At project inception, infrastructure upgrade costs are unknown and unpredictable.

Financial Feasibility: Medium-scale development from 4 units to 8 stories can be difficult to finance and has high risk brought on by contradictory planning policy, and uncertainty in approval processes and infrastructure upgrade costs