The British Columbia election is making headlines and capturing attention throughout the province, yet the proposed solutions to address one of the most pressing issues — housing affordability — have largely missed the mark.

Conservative plans: ‘Rustad Rebate’, ‘Get BC Building’

Let’s start with the Conservatives’ Rustad Rebate, a $3,000 monthly credit on rent or mortgage interest costs. While well-intentioned, this rebate seems to be a short-term fix that skirts around the larger systemic issues plaguing the housing market. This plan risks inflating property values further by offering rebates instead of addressing the root causes of high housing costs. The rebate could also inadvertently increase demand without a corresponding surge in supply, thus exacerbating the affordability issue it aims to alleviate. 

To be fair, the Conservatives have offered other housing solutions beyond the Rustad Rebate in the form of the “Get BC Building” plan. 

The costed platform and details of this plan were revealed just days before the election, leaving experts little time to understand the long-term implications of the proposed initiatives. Moreover, the platform sets an ambitious and unrealistic GDP growth target of 5.4 per cent, along with a deficit comparable to the one presented by the NDP. A lot of the content focuses on criticizing the NDP rather than providing further details on potential solutions.

Rustad’s proposal to develop new towns certainly captures attention and sparks creativity. But, many British Columbians, including myself, are eager to learn more specifics about how the details of this ambitious plan would be implemented. 

NDP plans: Cover 40% of a home’s cost for new buyers, tax cut & more homes for middle-class

On the NDP front, David Eby’s pledge to cover 40 per cent of a home’s cost for new buyers is similarly problematic, essentially transforming the NDP into the very speculators they criticize. 

While it’s designed to simplify entry into the housing market, this may also result in higher home prices, as sellers anticipate greater purchasing power from buyers. This also only targets a small group within the larger housing market in B.C. – first-time buyers. While we can all agree that first-time buyers are having an increasingly hard time getting into the market, this excludes equally important groups like young couples looking to start a family and seniors looking to downsize.

The plan also ties homeowners to long-term financial commitments that could become a burden if personal circumstances shift, echoing concerns from economic analysts about its potential to create new forms of financial insecurity. 

The NDP’s plan, combined with the Federal Liberals, could also significantly impact our housing market by encouraging potential buyers to pursue short-term incentives for homes that may ultimately exceed their long-term financial capabilities.

Both strategies reflect a trend toward using public funds to bring down housing costs. However, critics argue that these financial interventions don’t tackle fundamental issues such as property taxes and the cost of developing a project, which stand as significant barriers. 

Beyond Eby’s big idea to fund housing costs for new buyers, the NDP proposed a $1,000 boost for household budgets through a middle-class tax cut, along with a plan to intensify efforts against speculators and build 300,000 new homes for the middle class, which appear to be a fresh spin on their earlier policies. 

Green plans: Rental support & emergency housing

And lastly, the Green Party’s focus on rental support and emergency housing clearly leans on the public sector to boost housing supply and protect affordable rentals. While the public sector definitely has a role in making housing more affordable, we can’t forget about helping the private sector too. This approach overlooks a chance to come up with strong, creative policies that could connect with a wider audience looking for real change.  

Many of these electoral solutions fail to address the root causes of the complex housing affordability crisis in the region. From what we can see, even when they do acknowledge these underlying issues, they often lack specific details on how the party plans to implement effective measures.

Key solutions missing from the discussion include addressing the skilled worker shortage affecting home construction, slowing the growth of housing prices to allow wages to catch up, collecting wealth windfalls from zoning changes to fund affordable housing and implementing strategies to control costs in the regular housing market.

Ultimately, these housing strategies, though well-intentioned, risk becoming costly stopgaps. True progress demands policies that not only offer immediate relief but also pave the way for sustainable growth in our housing supply. B.C.’s housing crisis calls for a balanced approach that includes fiscal responsibility, market dynamics and long-term planning — a challenge that remains unmet in the current political discourse.

As political parties jockey for position in advance of the next federal election (taking place in October 2025, at the latest), the housing supply in Canada continues to be a major topic in the public discourse.

Since the last election, the Liberal Government launched several major housing-related initiatives. These include a $4 billion Housing Accelerator Fund (HAF), and more recently a $6 billion Housing Infrastructure Fund (HIF), intended, among other goals, to provide Provinces and Municipalities with alternate sources of funding to the infrastructure-related charges often imposed on housing developments.

And, the recently announced 2024 federal budget contained a slew of housing-related commitments and allocations, including plans to explore utilizing government-owned land for housing development. 

Fund distributions require long, labourious processes — we need clearer, bolder steps

In the shadow of a forthcoming election and the climate of generalized discussions about a housing crisis, the federal government clearly feels the need to be seen as “doing something.”  It’s important to remember, though, that the legal mechanics of housing delivery are typically a municipal prerogative: development, building, electrical, plumbing, occupancy and other permits are all issued by local governments. 

Generally, the federal government isn’t directly involved in approving new housing. Accordingly, the funds mentioned above mainly operate to incentivize certain policy directions at the municipal or provincial level (i.e. allowing multiplex residential zoning, as of right).

Distributions from these funds require applications, negotiations and bureaucratic interplay between different levels of government — inherently non-alacritous and labourious processes which may explain why, for example, the HAF didn’t make its first funding announcement for almost a year and a half. Veteran housing analyst Steve Pomeroy estimates the HAF will have a limited impact on the immediate housing supply.

Since the federal government clearly has both an impetus and a desire to facilitate an increase in the housing supply, perhaps it’s time to consider clearer and bolder steps.

A federal CAC subsidy

Municipalities collect Community Amenity Contributions (CACs, sometimes also known by other names, like Density Bonus payments), the monetary or “in-kind” contributions developers make for increased density on a development site. For example, CACs would come into play when a developer wants to build a 12-storey building with a commercial and residential component, in an area currently zoned for four storeys of residential. 

Ostensibly, municipalities put CACs towards the community infrastructure required by increased residential density: parks, community centres, etc. Instead of adding costs to the housing supply, the federal government could step in and fund the CAC contribution.

A missing-middle project on the west side of Vancouver entails a CAC of some $70,000+ per unit (over and above the Development Cost Levies (DCLs) already charged for infrastructure upgrades). An average condominium unit in Vancouver’s Broadway Plan area would carry a CAC of somewhere in the range of $80,000 per unit. In recent years, municipalities like Toronto and Vancouver collected hundreds of millions in cash and “in-kind” CACs.

Under a federal CAC subsidy program, municipalities would:

1. reference the new homes approved and delivered in their market,
2. outline the CACs they would have charged and what they would have spent them on (e.g. a new community centre) and
3. ask the federal government to provide the funding.

This proposed framework is an extension of an existing rationale within the HIF process, which ties funding to a three-year freeze in development charges. Granted, a federal CAC subsidy would entail administrative oversight, but at least it would also have a tangible impact on affordability by removing the CAC cost layer from housing supply.

Eliminate the GST on all forms of housing

The government took a step in the right direction with the removal of GST on rental developments. However, bearing in mind that according to the CMHC, we have a chronic undersupply of housing more generally, the federal government should consider eliminating GST on all forms of housing.

Many fundamental goods and services are already GST-exempt, including certain food items, medical and dental care and basic financial services. Given that shelter is a fundamental need, why shouldn’t it also be exempt from GST?

Whereas at least CACs and DCLs contribute to the civil and community infrastructure that supports housing density, GST merely increases the cost of shelter for the end user. For a new unit of housing valued at $700,000 (approximately the current national average housing price according to CREA), the GST would be around $35,000.

Granted, there are some GST rebates for lower-priced homes, but these are only partial. Eliminating GST on shelter requires no bureaucratic administration and will directly and simply reduce the cost basis of the housing supply. 

Funding CAC contributions and removing GST present clear and present opportunities for the federal government to “move the needle” on housing affordability. Sometimes, simpler is better.