This week, the City of Vancouver took another step to encourage rental housing development over condo with amendments to commercial district zoning bylaw. The Greater Vancouver Area has suffered from the lack of housing supply and since developed many incentives for developer to construct rental housing since 2016. Expecting the economy to recover from COVID and when the day comes, the population inflow will lead to housing shortage again.
Edna Cho, a senior housing planner with the city said, “the move is to shift what the city calls the right supply”. The city is working around the equilibrium between condo and rental supply. Despite the price of purchasing a home declined in the past year, home ownership is still out of reach many Vancouver residents. To accommodate them would-be purpose-built market rentals with guidelines on rent and tenancy requirements.
C-2 zoning was designated for four-storeys, mixed commercial and residential developments on arterial streets. These zones are destined for a higher price given their location and convenience. Developer will maximize condo allowance and meet bare minimum rental unit counts. The ratio is 9 for mixed-use, 7 for strata, and merely 2 for rental in development application count.
The big change today in C-2 zoning is allowing developer to built “two additional storeys for mixed-use building developments where the entire residential portion of the building is secured as residential rental tenure. Improve local shopping areas by requiring a minimum amount of commercial retail use and by allowing an additional 2.2m. in overall building height for greater floor-to-floor ceiling heights in commercial retail units”. A strong package that might break the existing ratio.
The goal to create more rental housing, not affordable housing is the purpose of this amendment as rental housing construction is behind city’s target by 50% with only 1,031 purpose-built rental homes being approved. More than 50% of the household are renters and this trend will continue. Market rental on arterial road and core locations within the city is important for foreign worker helping the city grow. Our team of Vancouver commercial real estate advisors believe the city will continue to expand incentive for rental development into other zoning in the future.
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