The irony of affordable housing is that mandating it makes housing less affordable. This was highlighted by Burnaby’s planning department bombshell report on October 4th, which concluded that affordable housing does not work. Even when developers are willing to build for no profit, banks and investors, who are critical to project funding, won’t provide the needed capital. While the city may ask and project optimistic numbers on paper, the reality is that a lack of completed projects translates to lower tax revenues and fewer housing options. This hurts the overall affordability.
A good example is shown on Table 5 from the staff report: there are only 25 completed affordable housing units by the private sector since mandating affordable housing six years ago. Our team experienced this firsthand with a project on Willingdon in Burnaby which is now in foreclosure. The site was economically feasible before the Council updated its policy to require 20% of new developments to be designated as affordable housing.
One of the main problems is Burnaby started double dipping. The city mandates 20% of the units be classified as “affordable”, but are effectively at social housing rates as we have previously defined in our article The Affordability Scam. The rates are so low they result in significant losses to build and operate creating a massive initial and long-term tax burden on development. Additionally, Burnaby recently adopted some of the highest development taxes in BC by increasing there Development Cost and Amenity Cost charges by approximately 1200%*, further damaging the already fragile real estate market. As a result, the entire city of Burnaby has only seen three land transactions for 2024, according to Altus Studio’s land transaction database. Typically, we expect to see between 10 and 20 transactions in a normal year, which is a good predictor of potential development taxes collected and the number of affordable units built.
With the Province mandating that any affordable housing must be demonstrated as economically feasible, staff took on a momentous effort with industry exports to put together an extensive feasibility study, which challenges that affordable housing has broken development. To fix these issues, the report outlines the necessary changes and proposes amendments to affordable housing such as:
The report solidifies what the real estate industry has been saying all along: instead of projections, we need concrete results. If these changes are adopted, Burnaby would continue to collect some of the highest development taxes in British Columbia while remaining a feasible place for growth. More importantly the amendments will signal that Burnaby is open for business again, ready to collaborate with the development community to tackle the housing crisis and ensure the city’s continued prosperity.
Brandon Harding
Team Principal of ApartmentBlocks
*Based on a previous development cost charge of $3.55/SF and using an average unit size of 700 square feet
Amandeep graduated from BCIT with a diploma in Professional Real Estate from the Marketing Management program. With a strong passion for real estate, he understands that the process can be stressful and overwhelming. He dedicates his time to guiding clients every step of the way, ensuring the experience is as smooth and successful as possible. Amandeep takes pride in seeing projects come to life and making his clients happy.
Kat Rigter is a commercial real estate advisor and Senior Associate with the ApartmentBlocks Team specializing in the organization and sale of multifamily designated land. Kat has been a central member of the team since 2020, helping facilitate over $200 million in development land sales across the Metro Vancouver Region.
Kat’s persistency and relentless pursuit of ensuring her clients best interests are well represented is second-to-none, which has greatly contributed to her and her team’s success and reputation as one of Metro Vancouver’s leading land assembly teams.
Kat is an active participant in several real estate organizations including CREW (Commercial Real Estate for Women) and is passionate about building relationships within in the industry to help align the right buyers to her clients.
Personal Real Estate Corporation
Team Principal
(604) 349-1571
brandon@apartmentblocks.ca
Brandon Harding is the authority on Land Assembly, a published writer, and a community leader for changing land use in updating Official Community Plans. He is a second generation realtor that has personally transacted over $1,000,000,000+ in sales. Organizing and transacting land has been his passion since listening and learning about the positive impact that can result from successful assemblies through his father, who has been a Commercial Realtor since 1980. Brandon successfully transacted the largest high density land assembly by number of homes.
Brandon has developed the homeowner eligibility test and the PROACTIVE sales funnel, which has revolutionized land assembly and simplified the process for property owners while systematically achieving unmatched results.
Brandon is a thought leader in Commercial Real Estate. Some of his work is published on RENX, LandlordBC, and the Western Investor.
Brandon’s a community coordinator helping homeowners organize, strategize, and deliver a unified voice to Mayors, Councilors, and planning departments. This has led to thousands of property owners achieving higher designations for their properties and making them millions in increased land value. He has the experience and knowledge to empower real change that leads to life changing benefits.
Lauren previously was the Graphic Designer with the developer Peterson Group for over six years. Her experience working from the view of developers gives her an edge creating new engaging marketing material to attract developers and get them to pay premiums for the team’s land assemblies. By highlighting and featuring all the unique attributes of each land assembly in a visually appealing and deliberate way she efficiently helps bring more buyers with more offers to help drive competitive bid pressure and ensure the highest chance of a successful outcome for homeowners.
My name is Nicholai Malinousky, I am a graduate from British Columbia Insitute of Technology with a diploma in Marketing Management, specializing in real Estate. I was introduced to the real estate industry at a young age, and naturally took interest. I am now looking to make an impact to my team and projects with my fresh perspective and a strategic mindset.
