B.C. developers: Growth costs shouldn’t all be pushed onto new homebuyers

Key Takeaways:

• Starting in 2026, qualified developers will be allowed to defer more development-related fees and use more flexible financial guarantees to help speed up housing construction. These changes aim to lower upfront costs and address housing affordability challenges.
• While the changes are welcomed, developers like Rob Blackwell argue that the root problem is the high cost of fees and infrastructure charges, which have been layered over time. These costs ultimately get mostly passed on to homebuyers, making housing unaffordable.
• Blackwell stresses the need for more stable policies, better federal support for municipal infrastructure, and immigration strategies that support the construction workforce. He warns that frequent rule changes and lack of investor certainty are deterring capital and driving up prices.

The Whole Story:

B.C. is looking to speed up home construction by accelerating timelines and lowering costs for builders. Some developers say that while they support the changes, the issues that make home prices high go much deeper.

Starting Jan. 1, 2026, qualified developers will be allowed to defer a larger portion of development-related fees and use more flexible financial guarantees to begin projects sooner. The changes are part of amendments to the Development Cost Charge and Amenity Cost Charge (Instalments) Regulation, which has remained largely unchanged since 1984.

Rob Blackwell, Executive Vice President of Development at Anthem Properties, explained that builders have been urging the province to address these issues for years, but only when home affordability reached a critical level did they act.

“I think as a real estate development company and as an industry, some of the things announced with regards to deferrals have been things we have asked the government to do for a long time,” said Blackwell.  “What has been most alarming was the increase in costs. The affordability ceiling was hit. People aren’t prepared to pay anything more for rent or to buy housing and what makes that housing so expensive are the costs that go into it.” 

Blackwell says B.C. has reached a tipping point where the costs have become so high for housing that the market can’t bear it. While deferring development cost charges (DCCs) helps save developers from having to pay interest on loans used to pay those costs upfront, the real issue is much bigger.

“The real problem is the fees are too high,” said Blackwell. “The $10 million paid on a project in DCCs should be $5 million. This definitely helps but doesn’t get to the core issue.” 

He added that over time, well-meaning policies, costs or fees kept getting added. On their own they aren’t much but when stacked together they create a complex problem that can’t be fixed with any silver bullet. 

One of the biggest issues is how to pay for infrastructure. Blackwell explained that cities are limited in how they can fund the necessary upgrades needed for roads, water treatment, transit and more. Either raise property taxes or add DCCs. He believes that many cities have opted to avoid the political cost of raising taxes by dumping this burden on to new development, and essentially, onto new homebuyers. 

“If you aren’t in the housing system, like an immigrant, a young person, a first-time homebuyer, you are being penalized,” said Blackwell.

He believes that those costs should be more spread out among everyone and that the federal government needs to do a better job of helping municipalities access funding. They should give them the ability to borrow more, and allow for creative financing models, like issuing municipal bonds. 

“There’s a major infrastructure deficit all through Canada,” said Blackwell. “But all the things that support growth have to be paid for by more than people buying condos, that’s part of the reason why housing prices are out of control.”

Another major issue Blackwell believes needs to be addressed is constantly changing policies. He argues that the government should freeze policies for a while to give developers some certainty while they progress projects or even allow them to progress projects under the rules in place when the project started. 

“Once a business makes a decision they should be grandfathered in under the rules in place when that decision was made,” said Blackwell. “They shouldn’t be able to change things halfway through. The uncertainty this creates has scared away capital.” 

He also noted that caps on rent increases but no caps on property taxes or operating costs disincentivizes people from investing. He also noted that GST should be nixed on housing as it hits buyers with a major price increase right at the end of the sale.

Blackwell also argued that while the government has lowered immigration levels, it should be utilizing immigration to bring in the skilled workers that builders need.

“The goal here is to reduce costs and reduce the barriers for people to enter the market if they want to rent or buy,” said Blackwell. “The things we do from a provincial point of view should be geared towards that. We want to have a business that makes sense and people want to be able to buy or rent a house without it being such a stressful part of their life, that means we need to reduce those barriers and get some flex financing options into the market.”