The City of Delta wants to learn more about a new guide created by Metro Vancouver to encourage the construction of more rental housing.
That was the Delta staff response to a letter to council from the regional district, reaching out to offer Metro staff to make a presentation on the resource called What Works: Local Government Measures for Sustaining and Expanding the Supply of Purpose-Built Rental Housing.
It’s the latest in Metro’s “What Works” series of resource guides aiming to advance regional planning and housing policy goals. It profiles measures such as fee waivers and reductions, design and parking requirements, zoning and regulatory actions that can have an impact on new rental housing supply, as well as protection measures to sustain existing rental housing.
The results of the land economic analysis within the guide found that local government measures, such as pre-zoning, reduced parking ratios and other measures have “significant positive impact” on the creation of new purpose-built rental housing, according to Metro.
The regional district also notes new construction has been facing financial feasibility challenges. In Metro Vancouver, there were fewer than 10,000 new purpose-built rental units between 2011 and 2021, compared to about 87,000 new rental households, Metro notes. That translates to only one-purpose-built rental unit for every 3.67 renter households in the region.
The guide explains how a six-storey mid-rise market rental building was modelled under “typical” and “alternative” conditions in three representative market tiers in Metro Vancouver: Higher priced markets, moderate priced markets and lower priced markets.
The City of Delta, along with Surrey, White Rock, Pitt Meadows, Maple Ridge and Langley, is in the lower priced market.
“Under ‘typical’ or baseline conditions, a six-storey market rental project in these parts of Metro Vancouver are not shown to be viable according to return metrics outlined above. While land acquisition costs are relatively lower than the other two market tiers, market rents are also comparatively lower,” the guide notes.
“Overall, the baseline scenario is unlikely to be deemed attractive to most prospective builders/investors. While rental housing development is still occurring in this market, it is more financially challenging under the current market conditions.”
The City of Delta has proposed strategies to increase the number of rental units and protect renters, outlined within the city’s Housing Action Plan. Some measures have already been approved, while the new Official Community Plan (OCP) states rental and non-market housing contributions will be encouraged in all new projects over six storeys and will be expected for projects 18 storeys or higher.
While some new projects have been added in the last few years, or are currently in the application process, the amount of primary, purpose-built rentals in Delta only accounts for approximately five per cent of Delta’s housing stock. Most rentals can be found in other units such as secondary suites.
