Conwest COO: Why DCC rollbacks are not enough to boost Metro Vancouver homebuilding

Key Takeaways:

• Metro Vancouver approved a major policy reversal to roll back 2026 Development Cost Charge rates to 2025 levels and reduce planned increases for 2027.
• The decision was driven by evidence that high fees were making housing projects financially unviable which prevented new homes from being built and stalled regional tax revenue.
• Industry experts warn that while lower fees help they may not be enough to fix a structurally impaired market where construction costs still exceed what buyers and renters can afford.

The Whole Story:

Metro Vancouver voted for a major policy reversal this month.

According to the Urban Development Institute, the Metro Vancouver Board approved amendments to roll back 2026 Development Cost Charge (DCC) rates to 2025 levels, reduce the 2027 rate increase, and slow the transition to a 1% assist factor over the following two years.

“This win belongs to our members,” said UDI’s Interim President and CEO Michael Drummond. “Years of consistent, evidence-based advocacy, from individual companies raising the alarm on project viability, is what moved the needle. This is what collective action looks like. And there’s more work ahead.”

In a post on social media, Drummond  explained that housing delivery isn’t constrained by a lack of desire to build. It’s constrained by viability. 

“Buyers and renters have reached their affordability limits,” he added. “When projects don’t pencil, they don’t proceed, and needed homes simply don’t get built. Expected DCC revenues then fail to materialize anyway.”

Drummon says the move brings Metro Vancouver policy more in line with steps already being taken by municipalities across the region to lower cost impacts on development. However, he cautioned that But it is a minimum threshold, not a finish line. 

“Market conditions remain challenging, and further alignment between cost structures and what the market can support will be needed to restore housing delivery at meaningful scale,” he said.

Ben Taddei, Partner and Chief Operating Officer at Conwest Developments, says the change is welcome but won’t be enough to overcome the industry’s larger, broader challenges. He believes the world, as well as B.C., is in a “reset-tion” where the economy is shifting from being real estate driven to being resource driven.

“That transition will be painful for most. Real estate has played an outsized role in Metro Vancouver’s economy for decades,” said Taddei. “A lot of people depend on it for jobs. Now, it’s in a structurally impaired state.”

He explained that  people and capital are exiting the province. Housing prices and rents are too low to cover the cost of delivery. This means inventory levels are rising and starts are declining. 

“Even with free land most projects don’t pencil,” he said. 

He predicts that as developers stop working, unemployment will rise. Until the economy grows and household incomes rise, most projects won’t proceed. Taddei added that uncertainty around land rights and how DRIPA is being implemented is also creating real drag on the economy. 

“It’s very hard to commit long‑term capital when the basic ground rules for projects don’t feel stable,” he said. “So, reducing DCCs is helpful, but it won’t materially move the dial on delivery costs. The industry is being propped up by government-funded projects, not by market-based projects.”

Recent years have seen Metro Vancouver shift from minimal fees to aggressive hikes aimed at ensuring growth pays for growth. Prior to 2019, regional DCC revenues were relatively low, averaging $6 million to $13 million annually, but as capital spending surged toward $1 billion per year to fund massive projects like the North Shore and Iona Island wastewater plants, the Board approved a new structure in 2023 that targeted a 250% increase by 2027. 

“Growth-related infrastructure represents a significant portion of Metro Vancouver’s capital plan, and DCC revenues help reduce the burden on existing ratepayers and ensure that growth is helping to pay for growth in the region,” said Metro Vancouver officials in DCC documents at the time. 

Its plan before the rollback included the introduction of the region’s first-ever water DCC and a phased reduction of the “assist factor”—the portion of infrastructure costs paid by existing taxpayers rather than developers—down to a floor of 1%. 

According to documents, Metro Vancouver staff acknowledged this pivot was intended “to find ways to support the delivery of housing in this challenging market,” while Board officials previously defended the broader hikes by stating, “By increasing DCCs, we avoid double-digit levy increases going forward” and noted that the region was “playing catch up on a more equitable distribution of capital costs.”