If you live in BC - whether the Lower Mainland, Vancouver Island, Sunshine Coast, or anywhere else - and own a single-family property, an opportunity to increase its value and to generate additional revenue is landing at your feet.
Last month, The BC Premier and Ministry of Housing announced upcoming legislation "Housing Supply Act" in the autumn which will require municipalities to increase the allowed number of dwelling units on a single family lot to FOUR (or three, in some cases) or more where "well-served by public transit".
The announcement states that the provincial government will be:
"...delivering more middle-income small-scale, multi-unit housing that people can afford, including town homes, duplexes and triplexes through zoning changes and proactive partnerships;"
"...offering forgivable loans for homeowners to build and rent secondary suites below market rates to increase affordable rental supply quickly;"
"...streamlining and modernizing permitting to reduce costs and speed up approvals to get homes built faster;"
Many municipalities in BC allow secondary suites. The City of Vancouver already also allows laneway housing in every single-family lot that backs onto a lane, and the city of Burnaby is considering adopting a similar policy. With the new provincial legislation, every municipality will need to create a policy to regulate how this additional density is implemented. If they don't, the BC government can overrule local governments and rezone entire neighbourhoods to create more density.
While the provincial mandate will require the allowance of four dwelling units, a municipality can allow more if it decides that's warranted and appropriate. The city of Victoria already has a Missing Middle Housing policy that allows "houseplexes, corner townhouses, and heritage conserving infill housing in Traditional Residential areas of the city. The regulations allow up to six homes on an average residential lot."
In the near future, building revenue-generating additional homes on a single-family property will no longer be reserved for property owners in Vancouver and Victoria. How can you afford the cost of building either an additional home or replacing the existing house with a multifamily building?
One way is to reduce the financing burden. The Canadian Mortgage Housing Corporation (CMHC) created a program called "MLI Select", which it describes as "An innovative new multi-unit mortgage loan insurance product focused on affordability, accessibility, and climate compatibility." The insurance premium resulting from incorporating accessibility, rent affordability, and energy efficiency is reduced to a fraction of the typical premium. One of the eligibility requirements however is greater energy efficiency.
Another part of being able to afford building a new multifamily home or multiplex is to reduce the cost of construction. While many traditional builders believe that higher energy efficient homes cost more to build, they can be built for even less than typical construction. At least one BC single-family home builder has figured out a strategy to reduce the cost of construction. I've included some of that in my article "Top 10 Ways to Reduce the Cost of Building a House", but they're applicable to multifamily buildings as well. Another BC multifamily builder has crafted a recipe of techniques that has allowed it to build a building that performs at the highest level of comfort and efficiency but at a cost that is ~30% less than that of a minimum-standard comparable building. In a future article, I'll discuss both the single-family strategy and the techniques being used in multifamily buildings.
If you're considering redevelopment options for your property, look into my RED Report™ in which I show the available options for renovation, expansion, infill, or replacing the existing house.
Alternatively, if you'd like to discuss your options and your plans to build, rebuild, or renovate your existing house in the Lower Mainland or Vancouver Island, book a free 30-minute Diagnostic Session with me using the button below.