Don’t Miss the Middle

Current housing debates overlook Missing Middle housing, although it is important for affordability and community livability.

 

An intense debate is underway concerning how to increase housing affordability in Victoria. It currently focuses on affordable housing inclusivity requirements. The Inclusionary Housing Policy & Working Group Consultation (here is their summary presentation) discussed the best way to determine the portion of units in new developments that should be sold or rented below market rates.

This debate is mainly concerned with large development. It virtually ignores Missing Middle Housing, middle-priced and middle-density housing such as townhouses, multiplexes and low-rise apartments. There was no analysis of how the proposed inclusivity policies might affect Missing Middle housing development, or what policies could encourage more affordable neighborhood infill. This is unfortunate because this type of housing should play an important role in achieving our affordability goals.

First, some numbers. The Victoria region currently grows at about 1.5% annually, so to accommodate growth and increase affordability and we must increase housing supply by more than that rate, or about 1,000 units per year in the City of Victoria. Currently, about that many new units are being built in the downtown area, consisting primarily of high-rise condominiums and rental apartments, which is great, but does not meet everybody’s needs. Highrise construction is inherently expensive and many households, particularly families with children, prefer living in Missing Middle housing types in residential neighborhoods, close to schools, parks and urban villages. Cities for Everyone’s Affordability Agenda identifies the additional housing units needed for each neighborhood to meet a 1.5% annual growth target.

 

Missing Middle projects tend to be small (fewer than 20 units), and so are less profitable and more vulnerable to cost burdens. For example, a $50,000 traffic impact study or zoning variance approval process only adds $500 to the costs of developing a 100 unit highrise but $5,000 to the cost of a 10 unit townhouse.

The other main obstacle to Missing Middle infill is a lack of suitable parcels of land, which must be more than 10,000 square feet and zoned to allow 3-4 story attached housing, such as townhouses, multiplexes and low-rise apartments.  Victoria’s Official Community Plan identifies many areas suitable for moderate density infill, but zoning codes have not been changed to reflect those goals. As a result, each project requires a costly zoning change.

Critics argue that upzoning simply increases land values, and therefore landowner and developer profits, without increasing affordability, citing examples of expensive, high-density projects. This shows what happens if just a few areas are upzoned. However, experience in cities such as Seattle, Portland and especially Montreal demonstrate that broad upzoning can significantly increase the supply and reduce the prices of Missing Middle housing.

Montreal apartment rents are much lower than other Canadian cities due to decades of infill development. (www.sublet.com/city_rentals/montreal_rentals.asp)

Building more affordable Missing Middle infill will require policy reforms that maximize the number of parcels pre-zoned for compact infill, with minimal approval requirements, development fees, parking requirements and inclusivity requirements.

Reforms for More Missing Middle Infill

  • Pre-zone all parcels designated for attached housing in the OCP, allowing at least three stories.
  • Allow an additional story for corner lots, lager lots (each 1,000 square meters of lot size), and location on busier roads (subarterials).
  • Reduce or eliminate minimum parking requirements, and require parking unbundling (parking rented separately from housing units) so residents are not required to pay for expensive parking spaces they don’t need.
  • Reduce or eliminate development fees and approval requirements for smaller (under 20 unit) and moderate-priced (under $600,000 per unit) projects.

 

These reforms will help increase middle-priced housing, and since housing depreciates at 1-3% annually, the middle-priced housing we build now increases affordable housing in the future.

For More Information see, What do we want? Upzoning! When do we want it? Now!

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