Opinion: It’s a housing crisis. Why are cities like Vancouver still banning apartments in most areas?

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Vancouver is the epicentre of B.C.’s housing crisis and shortage. So why does the city still effectively ban new apartment buildings on most of its residential land, reserving it exclusively for low-density housing?

While there have been small steps toward reforming single-family zoning in Vancouver in recent years, apartments are still not allowed on more than three quarters of the city’s residential land. Much the same is true in other big, expensive cities in British Columbia and across North America.

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Under this decades-old zoning regime, apartments are permitted only in relatively narrow segments of a city. New apartment buildings are largely confined to busy roads and areas with older apartments where working-class and poorer folks live, while the wealthiest single-family housing areas are left largely untouched to avoid provoking NIMBY backlash.

The B.C. government has recently shown a willingness to push back on cities applying exclusionary zoning (more on this below), but it hasn’t been prepared to overturn the apartment ban yet.

Persistent exclusionary zoning is deepening the housing crisis and shortage and inflicting damage on Vancouverites and British Columbians — especially renters — in several ways.

First, the apartment ban is suppressing the creation of badly needed new housing in huge parts of our cities. The Canada Mortgage and Housing Corporation estimates that B.C. needs to build 610,000 more homes by 2030 above current trends. Housing shortages hurt the most vulnerable while adding new housing helps reduce upward pressure on rents. We can’t address those shortages while blocking apartment creation on the vast majority of cities’ residential land.

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Second, the apartment ban in single-family areas is driving displacement of tenants in existing apartment areas. Under the status quo, with apartments blocked in the vast detached housing zones of our cities, development is steered towards existing apartment areas, leading to demolition of older apartment buildings. It doesn’t have to be this way: new apartments could be built instead in nearby single-family areas if cities would allow it.

Third, exclusionary zoning increases the costs of new housing. In limited areas where apartment housing is allowed (through discretionary rezoning processes), developers of new housing — non-market and market alike — have to compete for scarce parcels, driving up land purchase prices. As a result, even well before a rezoning process, exclusionary zoning artificially increases land prices for the sites where apartments are allowed by keeping them scarce.

For non-profits trying to build affordable housing, going through the rezoning process itself can be costly and risky. Higher costs for non-market housing translate directly into higher rents, hurting housing affordability. In Vancouver, non-profit housing developers estimate that a rezoning process can easily cost them $500,000 to $1 million, including required pre-development expenditures and fees.

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Fourth, by suppressing apartment creation in wealthier areas, exclusionary zoning doesn’t allow people to live where they choose. This is a conscious effort to ensure certain neighbourhoods are reserved for “the crème de la crème,” as one resident of a wealthy Vancouver area put it.

Instead, residents of most new apartments are forced to live on noisy, polluted arterial roads, where building apartments is primarily allowed, harming their health and well-being. Indeed, one “community vision” document in Vancouver from 2005 praised this practice of confining new apartments to busy roads because they help “shield, to some extent, adjacent single family homes from the noise of arterial traffic.”

Fifth, when cities like Vancouver block apartments on so much of their land, it pushes people out of the city and spurs more car-dependent sprawl in outlying areas. This means more commuter misery, higher household transportation costs and increased pollution. A growing body of research points to these exclusionary residential land use policies as an important driver of pollution contributing to climate change.

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Sixth, channelling development into suburban sprawl increases public infrastructure costs. It’s much more expensive to provide roads, sewers, schools, transit and other public goods in suburban developments than in more compact communities. The continued imposition of the apartment ban makes addressing long-standing infrastructure deficits more difficult and expensive.

Seventh, excluding people from large high-productivity cities by blocking apartments means excluding them from job opportunities and higher wages, which hurts economic growth and increases inequality.

With a provincial election fast approaching, where does housing fit in this equation? B.C. is head-and-shoulders above other Canadian provinces on housing policy and the provincial government deserves credit for that. But the action still doesn’t match the scale of the housing crisis in many important dimensions, including on zoning reform.

In a step forward, B.C. legislation now requires cities to allow small multiplexes in areas formerly reserved for single-family houses. However, this falls far short of allowing apartment buildings, and cities like Vancouver are implementing the multiplex policy in a highly restrictive way.

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The provincial government is also pushing cities to allow apartment buildings within 800 metres of transit hubs like SkyTrain stations, which include areas still dominated by single-family houses. But there are too many ways for cities to wriggle out of these requirements, which apply to limited areas.

These steps forward urgently need to be expanded. The B.C. Conservative party strongly opposed these limited steps on reforming single-family zoning. In an interview earlier this year on CKNW’s Mike Smyth Show, leader John Rustad called the B.C. government’s reforms “crazy” and promised to “repeal all of that,” despite saying he would (somehow) increase housing supply. The B.C. Green party voted against the legislation allowing multiplexes in single-family areas but in favour of housing near transit hubs.

To end the apartment ban, at a minimum, expensive cities like Vancouver should be required to allow at least six-storey rental apartments by right — without discretionary site-by-site rezonings — anywhere that you can currently build multimillion-dollar detached houses (that is, almost anywhere). Significant additional density should be permitted for non-market housing specifically, ensuring public and non-profit providers are in a strong position to acquire land when competing with private developers.

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There is no way out of the housing crisis and shortage — or towards a large build-out of non-market and rental housing on the scale B.C. needs — without finally ending the apartment ban.

Alex Hemingway is a senior economist at the Canadian Centre for Policy Alternatives, B.C. Office.

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