One of the toughest purchases for most people these days is that of a home – particularly if they are just getting started in the housing market.
Housing prices have been on a mostly upward trajectory since the late 1990s. Even since the 2008 economic downturn, they have barely paused in their relentless advance.
Surrey has been one of the most popular places to look for a new, (relatively) low-cost home. Many of these are townhouses or apartments – single-family housing is not nearly as dominant as it once was. Indeed there is no such thing, as virtually every single-family home being built has enough room for one or more suites to be added.
While housing prices in Surrey are considerably lower than in Vancouver, a recent study shows that the city adds a substantial sum to the cost of each home with its development cost charges and other fees. (See story, page 8).
For a 22-townhouse development, that additional fee is more than $700,000. That means city requirements add more than $33,000 to the cost of a home.
As the study, prepared by Simon Fraser University’s urban studies program, points out, Surrey has some good reasons to demand the charges. Growth does not come cheaply. Water, sewer and roads must be added. There are additional traffic challenges. There are added pressures on transit, schools, police and fire services, as well as other city services such as libraries, recreation centres, parks, ice rinks and pools.
“We understand there’s a need to have development charges to pay for growth. What we really care about are the delays and inconsistent application of rules across cities and even within cities,” said Bob de Wit, president of Greater Vancouver Home Builders’ Association, which helped commission the study, called “Getting to Groundbreaking.”
Surrey has been taking a good portion of regional growth, with other fast-growing areas being Vancouver, Burnaby, Langley Township and Coquitlam. In the municipal elections, it became obvious the pressures of growth are being felt in almost every Lower Mainland community.
Canada Mortgage and Housing Corporation says about 30,000 new households are being formed in the Lower Mainland each year. This growth comes from immigration and inter-provincial migration, as well as young people leaving parental homes to set up their own households.
Growth is certain to continue in Surrey at a fast pace, given that there remains a large supply of land that can be developed – something that is becoming scarce in many other Lower Mainland communities. However, even with the hefty development cost charges, many city services are having a tough time keeping up.
Perhaps the most obvious example is policing, where Surrey RCMP is clearly understaffed. Growth is also felt in hospitals and schools, both of which are dependent on the provincial government for capital funding.
School capital funding was significant for a number of years, but has been more restricted in the past two years. Yet children continue to arrive on the doorsteps of local schools, some of which are significantly overcrowded.
The study makes the excellent point that there needs to be consistency in the application of rules by each city and more consistency across the region. Surrey gets reasonable marks from many developers, but there is room for improvement.
The challenge facing cities like Surrey is to manage growth so that existing services are maintained for those who live in Surrey now.
Frank Bucholtz is the editor of The Langley Times. He writes weekly for The Leader.