As many of you may know the BC recently held a Provincial Election. With only around 52% of voters participating the Province elected a Majority NDP Government. So, what does this mean for our Real Estate Market?
The NDP's Market housing policy can be summarized as;
1. Reduce construction costs to make homes more affordable by bringing the costs to developers down.
2. Streamline and modernize housing construction by eliminating outdated parking minimums in projects close to public transit.
3. Develop a single-window provincial permitting process.
4. Work with communities to streamline approval processes at the local level.
5. They also plan on increasing regulatory powers in the Insurance sector for Strata corporations and investigate ways to bring insurance costs down. If they are unable to bring costs down they have promised to develop a public strata option in order to achieve this.
Currently permitting is one of the most difficult and sometimes slowest parts of starting construction.
If this promise is fulfilled it could mean dramatic increases in the speed in which new projects can be started and completed meaning a possible increase in inventory of new builds. Reducing the parking requirements for modern housing can be a double edged sword in terms of pricing. For those who do not have a car this will be perfect as it will bring the cost of their home down dramatically; however, for those with a car it will come at an even greater cost to keep their vehicle. Currently developers on average charge upwards of $30,000 + GST for parking spots, and with the supply decreased it could mean that these prices could surge even higher. With many strata's in BC seeing dramatic increases in their insurance premiums many are eagerly waiting to see if there would be government intervention in order to control the pricing in this market. Should they be successful many owners of strata properties could see a potential decrease in their monthly insurance premiums.
A Summary of how the NDP plans to tackle housing is increase the supply by streamlining the process for developers to start new projects and have them focus resources on building homes rather than building parking and attempting to gain permitting. Only time will tell if this will result in an increase in affordability for buyers.