 The goal of the webinar series is really a key concern around market affordable housing in our communities but also for industry and stakeholders and citizens across BC who are challenged with finding affordable housing that meets their needs. These webinars really help to share information with folks around the province to also create a forum to encourage the sharing of solutions that work at the local level and create a community of practice where folks can bring ideas forward and also meet the needs of what information you're looking for at the local level as we know we best learn from each other. This webinar format is a way of doing things that help make things easy and cost effective for folks to participate. It also helps to build on the momentum of the affordable housing symposium that the Canadian Home Builders Association of BC has been holding for the last couple of years and it hopes to continue that discussion over the interwebs college. And it also opens it up for folks who can travel to such events. This webinar will hopefully be the beginning of a pilot of three webinars. This one particularly today helps to set the context for the series by helping us explore some of those economic and other drivers that affect housing affordability. Our second webinar in November will help us get an insight scoop from a developer's point of view on the elements that help to contribute to the cost of building affordable housing and take us through a performance which is the developer's guide to helping to calculate cost for housing development and also to see those different elements and how they help to make or break a project. And then in January we will get down to the nitty gritty and take a look at how secondary suite bylaws and enforcement work in different communities and take a look at two different local governments, what has been a step back solutions and successes with implementing their secondary suite policies. Move forward and get us into the real meat of this webinar today with helping to introduce some of our presenters which I'm sure a lot of people already know and don't really require much introduction. So first off I'd like to introduce our first speaker, Cameron Muir. Cameron is a well known economist and housing market expert. He joined the BC Real Estate Association as the chief economist in 2006. Since that time he's built the economic department from the ground up providing objective analysis, research and regular forecasts of the economy, market housing and mortgage rates. He's also used to work at the Canadian Mortgage and Housing Corporation for ten years. He's also a member of the Canadian Association of Business Economists and the Association of Professional Economists of BC. He's also an appointee to the Provincial Government Economic Forecast Council and so without further ado I'll pass it over to Cameron. Good afternoon. My pleasure to take part here today. I've got about, I think about 15 minutes to briefly go through some things that I tend to look at with affordability. It's pretty hard to have this a treatise on affordability when we have such limited time. I am trying to figure out how to draw my slide. Oh, there we are. First slide. There we are. So I've got to cover five points here briefly. I think that I kind of see from my kind of 30,000 feet up in the air here and first thing is that affordability or increased affordability via rapid home price depreciation is not very likely. I'm going to talk a little bit about that. General affordability measures also can be quite problematic because we see a lot of high level ratios which really don't tell a picture of what's actually going on in the marketplace. The third thing is, I want to look at timing, demand and supply. With housing it's extremely difficult simply because of the ability of village and developers who are particularly in large metro areas to satiate demand in a short period of time. Fourth thing is, I'll talk a little bit about first time buyers and how they're one of the most important market segments for which anyone should look at in terms of a housing market, in terms of both affordability and the health of the marketplace. Finally, thank you for the poll that land came out as an important element because my last component is land component of housing construction is the one thing that we can shift around a little bit but there are some dangers around that. First of all, things I'm still waiting for to happen in the marketplace, while I'm waiting for flying cars, hoverboards, portals and sideboards we haven't seen that and the other thing I'm still waiting for is the great real estate crash of 2013 which was predicted in January of this year. Unfortunately, we haven't, well I guess fortunately we haven't really seen that yet. The reason why I kind of pull this out is that there's some expectation amongst many participants, industry participants that perhaps we're going to see a significant price direction in the marketplace and that's going to add to affordability. The problem with that is the analysis around this kind of overvaluation in the marketplace and its imminent demise tends to be somewhat back of the envelope if you will and that the reasons, if we do have, if there was a sufficient macroeconomic shock in order to drive home prices down 30 or 40 percent, those that would think housing is affordable would actually find it likely unaffordable because our unemployment rate would be extremely high and many of those who would likely have been able to take advantage of lower home prices wouldn't have jobs in order to secure a mortgage. So it's a little bit problematic in that regard. One of the ratios that's typically used, I think it was used in McLean's magazine as well, is this idea of home price to income ratios, a firm called Demographia. Every year it gets a significant amount of media attention around their most unaffordable city's list. As you'll notice here, Vancouver is number two to Hong Kong and instead of a home price income ratio, they are using what's called a median multiple, which is exactly the same thing, median incomes to median prices. In Vancouver, I think we look here closer to home, it was a close 9.5 percent, something around that according to this chart, Hong Kong's number one, but if you look at all the top cities in terms of the top unaffordability, they all tend to be more global gateway cities, those that have a significant amount of economic diversity, those that have a significant amount of job growth and amenities. There's got to be more, there's got to be some reason why this is occurring and I guess part of the irony with the Demographia's analysis here is that sometimes this is used reason for greater housing regulation because of the fact that housing is unaffordable in these cities and Demographia's reason for existence is to actually get land use regulation, so I think that's kind of ironic. If we look at housing as a multiple of income in terms of price, you see Vancouver's 9.5 percent, you would think that when we look around Vancouver, where would we expect to see that much less figure? Where is it, who can afford housing in Vancouver? And so it's been suggested to me that perhaps some of the more tonier areas of Vancouver, if you live in Shaughnessy, you should certainly be able to afford housing there. Well, where the Vancouver's the total according to this survey is 9.5 percent, I did a little looking here and in fact in Shaughnessy, prices of homes in Shaughnessy are 24 times the household income in Shaughnessy. So I don't know whether we need to provide some relief to those wealthy individuals in Shaughnessy or not because apparently they're they're least affordable amongst all major cities in the world and that's kind of a time-and-cheek joke there. My point is that it's very hard to take a look at incomes and affordability without looking at such things as interest rates and particularly overall wealth. So it's kind of a stock and flow argument where incomes don't necessarily tell the whole tale. You can have an income in Shaughnessy, I think it's about $140,000 a year on average, the net worth of individuals there is much more. So their wealth is great, perhaps their reported income not so great doesn't mean that housing as whole is that unaffordable. In fact, if we look at the lowest according to demographic, the most affordable city in the U.S. and I'll show you this and I hope everybody doesn't decide to move there is that the most affordable city according to the survey worldwide is Detroit. So I think it's a multiple of 1.5 income is Detroit whereas Vancouver is about 9.5 but the only problem there is that not a lot of people want to actually live in Detroit seeing as there's really not many jobs available there when entities are not that great anymore and the quality of life can be somewhat suspect. When we look at Vancouver for example, Vancouver is a global gateway city and we find that in global gateway cities that housing costs tend to be much higher than other areas. There's reason being is because there's plentiful high paying jobs and a bunch of entities. They also tend to have problems with congestion particularly cities like Vancouver that has a constrained land supply. Vancouver is almost very much an island in the sense that it has the mountains, the ocean, the agricultural land reserve and the border. So land values in Vancouver have been bid up quite substantially over the last run-up. I'm going to talk about that in a minute. Also congestion, transportation also deepens that kind of land price gradient as the longer, the more costly it is both in time and money to live far enough away to buy a less expensive land. It doesn't make a lot of sense to be too far away simply because of the congestion and transportation costs. If we look at another way of looking at affordability is the carrying cost. So this would look at this is the carrying cost in British Columbia, this is the average priced home in BC combined with the prevailing mortgage rate at the time. And it's deflated taking inflation out of the picture so that we can look at it over a long time series to see where we are today. Certainly if you'll look where we are today at least in 2006 we're quite a bit above what that long-term average would be and you know there's been some pundits suggested of course we always have to return to the mean and that means that you know home prices have to fall as a result. I'm not quite so sure about that and I'll tell you why in between 2006 and today we're probably looking at, well we're looking at about seven years almost. We've had seven years where we've been trolling up and down from $2,100 to about $2,800 a month on a inflation adjusted dollar basis and it almost appears to be that that $2,100 is the floor level now that's where we bounce back in early 2009 and it's where we hit in the winter of 2012-2013 as well and so from that perspective you go well maybe there is a new floor in terms of where an average payment is or where affordability is in British Columbia and but there's another reason I think we need to look at this is that during that period that I have there if you see the box average price data in British Columbia became quite unreliable during that period as a result of some serious skewing in in in Vancouver so if we look at next slide is average price during that period you can see between 2006 and 2013 there's quite a a difference between the average price data that's being reported as versus the benchmark price which is a much better price indicator in Vancouver so the benchmark price and home price index are kind of inversions of each other the home price index is an index and the benchmark price is an actual number it's a combination of an edonic price model and a paired sales model and essentially it predicts what the price is for the typical marketplace so during that period of time we did not see in terms of the benchmark price that significant run-up and that's why I would argue as Vancouver certainly heavily weights the province that if we go back to this box here that that's been kind of skewed substantially by pricing average price data as a result of compositional effects in Vancouver so it's actually not as high in terms of the carrying cost historically as it may appear in fact if we look in Vancouver for example I use Vancouver as an example because it weights the province so heavily is that you know the condominium market apartment townhouses really haven't moved much in price at all since the recovery in 2009 in fact they're both the same today as they were at the end of 2009 and if you discount inflation we've actually seen prices fall now about five six percent since then and that's on inflation adjusted basis so that would be a quintessential soft landing from an economist perspective on the tax side however we have seen some significant inflation in prices on that market and that segment of the market part of that I think over the long term we know that since 80 percent of housing starts are multi units that single attach units in Vancouver are going to be a smaller and smaller proportion of the housing stock which over time will garner an increasing premium on the property ladder effect and this is what I really look at in any market is first-time buyer affordability that's the most critical thing for the baby boomers the pig and the python working themselves into retirement now for them it is not as much of an issue because you know the home price of their next home is really the incremental value of the difference between all that equity they have amassed over the last 30 years and the new home price whereas the first-time buyer of course only has a limited down payment and so we need to be able to have enough of the market price so that first-time buyers can afford to get in there now you could also look at this in some markets of the province that have a lot of interprovincial migrants or perhaps retirement markets that we need to be cognizant of of values there vis-a-vis values from source provinces but overall in the large urban areas first-time affordability is critical through the real estate board of Greater Vancouver about 30 to 33 percent of home sales in any given month are the first-time buyers so very important components and i would argue that if we look at the pricing data irrespective of what average prices say into the highest in the country and they get skewed by very expensive markets on the west side in west Vancouver that you know first-time buyers can buy an apartment condominium in Vancouver in Greater Vancouver or Metro Vancouver for $250 to $300,000 all day long and that would suggest their income would only have to be about 15 to $18 an hour for a couple to be able to afford to get into those homes at today's interest rates at about a 10 percent down rate so first-time buyers can get into the marketplace it's just that when we look at the housing stock today is that it's increasingly diversified from what we saw 30 or 40 years ago 30 or 40 years ago we the first home was a bungalow second home was a two-story home and your third home was the executive home was the two-story home of the pool today you start off with a bachelor apartment or one-bedroom apartment and work your way up to perhaps a a two-bedroom apartment to perhaps a townhouse to perhaps a duplex to a small odd single attached hose to a bungalow etc etc and so the diversity of product has really made it really made housing attainable for many first-time buyers and we're that's one of the reasons why we've seen that segment of the market continue to be relatively buoyant. The other issue in affordability is is actually i just want to step back and say when we look at affordability in the first-time buyer side during the financial crisis recession first-time buyers just vanished why because they had a small amount of down payment from the market and they didn't want to see that evaporate and if it's a deflationary spiral why don't we just wait and you know get buy a home at 50 cents on the dollar later. What that did is gum up the entire marketplace those who are had their homes for sale couldn't sell those and go up for their move-up buying and so they're very important to any housing market. The other thing is timing. Timing is everything in in in any kind of market and in real estate it's a very critical issue and one of the problems is that it's very difficult to match supply with demand at least when we see a large shifts in demand and supply. It typically takes in in a large urban area two to three years from conception to completion for a large major project and so that offers irregularities or abnormalities in in in the market operating. For example if we look back in the year 2000 I mean year 2000 we had the lowest number of housing start since 1962 and the following year which would be completions the fewest completion since 62 in 2001. You have to remember in 1962 we had to half the population that we did that we do today in Vancouver so home building was dried up to a significant degree during that time the late 90s the economies in the delgrooms we had tens of thousands of people leaving the province in search of jobs and we also had this little thing on the coast called the leaky condo crisis. So what happened was housing was literally under consumed people didn't want to get into the marketplace and a significant amount of pent-up demand welled up. So what happened was is when we look at the demand side here's residential sales just through BC the curve in Vancouver probably look the same or very similar is that once we hit 2000 2001 we saw increase in overall demand during that cycle. What happened was first time buyers and investors were first out of the shoot they didn't have homes to trade into the marketplace so they drew down a lot of inventories. By the time builders and developers had the signal and actually had product complete on the ground to move in it was a few years later and there was a catch up a lot of catch up being played during that period of time. As a result strong demand not enough supply on the market prices get bit up and that's really a function of real estate markets is a typical kind of lift and plateau effect in which prices rise in times of imbalance between supply and demand and then they plateau or age lower during times of relative balance. What we see so far of course during this current cycle is that 2012 we saw a lot of erosion in terms of overall demand as a result of tighter credit regulations some trepidation amongst consumers and this year we've seen a significant rebound in terms of overall consumer demand coming back to what we would call long-term averages. Cost deposit component very important unfortunately you know to change the prices of homes to reduce prices of homes you really can't task home builders and developers to go over and build so many units out there that prices are going to fall and they're going to go bankrupt. So at best we can do is try and perhaps better facilitate projects to get through the stream much faster at times when markets are undersupplied. Soft cost can have an impact certainly has an impact on overall development costs particularly when we look at a length of time and an arbitrary kind of approval processes but also through taxation. If we look on the taxation side I think the home village association did some work at a that a home that you pay the new home you paid five hundred and sixty seven thousand dollars worth four years about a hundred eight thousand dollars in taxes fees and levies and other embedded charges imposed by all three levels of government. So that's certainly an impediment to affordability there and finally the land value well we didn't get the land cost where we go here. Sorry I have another little graphic on there didn't show up. My point here is that the residual value is what tends to be played with now it's one of the reasons why municipalities around North America cities around North America are looking rather than just flat out rezoning areas if they have a negotiation with builders and developers in terms of of bonus densities, up zoning in order to for the city or the jurisdiction to take part in some way in the list of property values and that certainly has gone on strong in in the city of Vancouver and has in some instances gone a little too far perhaps on the other side of the equation. We just have to look back at Concord Pacific who had an appeal to assessment appeals board that essentially there's the negotiation on on that land with the city of Vancouver resulted in the improvements that needed to be made resulted in the residual value of zero so that really doesn't help a city or municipality and particularly around their property tax front. The next slide. So really there's two affordability questions I look at is one of how can we better understand affordability so we can create effective strategies and like I said earlier is that a lot of the data around affordability needs to be massaged or looked at a little more carefully one of the troubles with data coming out of stats can when we look at the SHS survey, survey level spending as well as the income data that comes out of the census is they tend to be matched in two different years and so we end up having you know these ridiculous statistics like nine percent of renter households under the age of 25 in Vancouver pay more than a hundred percent of their income on housing. Well how can that really happen? What it is is the data problem is the fact that they're either in university working for mom and dad the year before had no reported income and that the very next year when they had a we're renting an apartment that's paying that rent they're matching rent to an income stream that was not existed the year previous so that's just one example of some of the problems with matching that data. Overall the final thoughts is that really affordability via asset deflation is probably not very likely I mean we just several years ago we went to the the great recession as it were financial crisis in North America in a global perspective that wasn't a shock to burst any kind of housing bubble I don't know what was since then we've seen particularly condominium prices come back up and been quite flat ever since there's really no evidence today that there's any kind of bubble or speculative bubble welled up in the marketplace and that prices are going to fall dramatically and make homes more affordable. Affordability measures are problematic home price income ratios ignore interest rates for example and when compared in different jurisdictions and when you don't take account the actual wealth of households it can be somewhat suspect in terms of the data or the rankings hence Shaughnessy being much least affordable for people that live there than Mabel Ridge or Surrey. Timing of demand and supply very difficult because we tend to have a relative boom or bust cycles and as a result we'll have periods in which you have home building activity slows down demand picks up a year or two later much stronger than builders and developers had anticipated and as a result we get land prices bid up. First time buyers very important critical market segment you need to make sure that you have a sizable amount of housing in the community that can accommodate affordability of first time buyers and finally the land component is really that variable in which municipalities tend to be trying to play with is buying able to participate in the list of either through up zoning or bonus densities. At the local level there's lots of tactics that can be deployed some of them are just easy as community plan policies that show commitment to providing a range of choices increased densities secondary suites permitted in all single attached dwellings for example infill housing housing agreements smaller lots all those kinds of things are very important which are I believe our next speaker is going to touch upon in her jurisdiction and I think my 15 minutes the same as up thank you very much excellent thank you Cameron I'm going to open up the line or the Q&A's for a couple of quick questions we will be able to go back after Mayor Ackerman's presentation to have a more robust question and answer period but if folks have one or two questions we can use the next five five seven minutes for asking Cameron a few questions you can either do that for the Q&A's or you can unmute is that through star six to do that we'd actually have to go off of lecture mode so what I'll do is it's timely if the audience could support us on this and if you could mute your line which is excuse me star six on your phone and please don't please don't put your phone on hold as well or we'll be getting music back as well and then that'll allow us to open up the lines and what you can do is yeah use that feedback menu on the top right hand corner to just change your indicator from green proceed to purpose which is question like we did just off the top if you were with us at that point so I'm going to try and go off lecture mode right now and we'll see how that works and hopefully we can that way or again just as Ginny noted please use that Q&A box right at the top of your screen just above my indicator here and you can type in your questions there and you can make them just a moment I'm going off lecture the conference is no longer in lecture mode oh we seem to have a ringing um just anybody through that have a question that they'd like to pass the camera before we move on to the next presentation the conference is in lecture mode to see if any questions come through the Q&A give you a chance to type and if not we'll we'll start with the next presentation and then we'll have some time at the end for more more discussion for questions near the end that we'll be able to pull all the pieces together so I'd like to introduce our next speaker who's all too familiar with what the economic drivers are doing to housing in her community like to welcome her worship Mayor Laurie Ackerman of the City of Fort St. John as our second speaker Mayor Ackerman has lived in the peace region for 31 years from 1980 to 1988 in Dawson Creek and then moved back to and then moved to Fort St. John she was elected mayor in November of 2011 prior to this she's served as a counselor for the City of Fort St. John since 2005 Laurie is represented the city as the director with the Peace River Regional District since 2006 and a Northern Development Initiative Trust since 2008 since becoming mayor Laurie has been appointed to the province's local government RCMP contract management committee and a member of the steering committee for the BC Mayor's Caucus her volunteer work just to name a few includes emergency social services goes Canada serving as a founding member of the United Way Cabinet and Fort St. John ensuring the community's homeless shelter committee in 2002 she received the Queen's Jubilee medal for her work in the community and then 2005 the Silver Acorn for distinguished service in scouting Laurie is a firm believer that BC can harvest its natural resources with the use of innovative BC born technology to do it effectively efficiently and leave a lighter footprint. Laurie was also a speaker at the 2013 Canadian Home Builders Association BC housing affordability symposium enrichment and they're delighted that she could join us for our first webinar so thank you Mayor Ackerman and I'll take it away thank you I'm hoping that you can see me because I've kind of lost the video at this end however it's a pleasure we can see you a pleasure to to be able to have this opportunity to share with you some of the initiatives that BC's energy capital has has put forward so just a highlight for for the presentation today and how it's not moving it's Derby here are you able to use those arrows just above your start button in the bottom left hand corner to move the slides well let's give this a whirl there we go okay so just I'll give you some community information I'll show you what we've done in our official community plan affordable housing committee as well as site C and I would be remiss if I did not speak about LNG we know it as LNG some others may know it as liquefied natural gas so moving on as I mentioned Fort St. John is BC's energy capital we have the two dams on the peace river already we have the proposed site C on our doorstep seven kilometers from my downtown and of course the energy industry is here we are the second largest community north of Kamloops with only Prince George being the first one we are one of four cities north of the 56 parallel in Canada the other three being Yellowknife Whitehorse and Fort McMurray so we do have northern community development guidelines when I drive through Surrey and White Rock where I live prior to moving up here and I see some fabulous things that they're doing down there I have to imagine that with six feet of snow on it we are in Canada's most northern agricultural area we do have a very strong forestry industry and we have some oil here but predominantly is natural gas which we hear a lot about we are one of BC's youngest communities and just to give you an example we cut the ribbon on the hospital that was actually opened three weeks earlier in three weeks there were 33 babies born here we have young families a lot of young families here and the fastest growing demographic is seniors so when we plan we plan for wheels and more wheels so in our official community plan I think I might have missed a slide there we go just talk about affordability from Fort St. John's perspective first of all if you take a look at what the average wage is in Fort St. John a couple's only the average family income is a hundred and six thousand per year and couples with families a hundred and twenty three thousand per year loan parents families is over sixty one thousand dollars per year so affordability means some slightly different things here than perhaps in other areas of British Columbia the average construction costs are anywhere from 30 to 40 percent higher here than in the lower mainland area specifically because of the cost of trades as well as the cost of supplies when we look at affordability we also look at operational costs because when you're living in a community that experiences 40 below your heating bills can be a little higher and so we do have to consider when we've got people who are needing affordable housing they probably could use affordable operational costs as well Fort St. John the city of Fort St. John is going to be cutting the ribbon on North America's most northern passive house in just a few months from now and if you haven't heard of a passive house this really refers to a rigorous voluntary standard for energy efficiency in a building and reducing its ecological footprint so it results in ultra low energy buildings that really require very little energy for heating or cooling and in my research i have only found one bungalow that is further north than what we have and that is in Scotland now we get into our official community plan so first of all our official community plan is very robust i would welcome anyone to take a look at it i think i've given a link to the facilitators here for this our official community plan has four guiding principles and they are listed there sorry i meant to hit the button here while i've got my ocp open in front of me so the four guiding principles are there in front of you economic prosperity environmental sustainability social inclusion and cultural vitality the our intention is to build a community that meets the needs of current generation without diminishing the ability of future generations to meet their own needs and so a lot of our housing conversations even with our affordable housing committee has come from our ocp and how we move forward on those so in particular some of the official community plan um there we go what we're saying is that housing does not cost greater than 30 percent of 80 percent of the median household income and fortune john and because that household income and fortune john is considerably higher than in other places we've taken 80 percent of that just really to round it off because we do recognize that we do have a portion of our population that certainly do not make over a hundred thousand dollars a year we refer to a range of housing from non-market housing to standard market ownership and at any given time 20 percent of our population is in need of some form of affordable housing so we have several objectives and intentions within our ocp and first of all of course one of the objectives is to promote increased affordable housing through partnerships and other levels of government and organizations and i think that's what was said at the beginning of this webinar that affordable housing does not happen with just one partner one stakeholder it is a partnership and so the city of fourth angel certainly is going to take advantage of whatever partnership we can get our hands on so some of the policy statements within our ocp refer to an intention to provide incentives for the development of affordable housing so we're looking at three points there we will will consider higher density we will consider reduced parking requirements and we will consider small lots in planned subdivisions and now when i say this and you're scratching your head trying to figure out why those would not just be an automatic as a winter city we need places to put the snow otherwise hauling it is going to be an issue parking requirements i can tell you that my vehicle would be considered a large vehicle in vancouver but i could fit two of my vehicles in my husband and i could fit three of my vehicles in my son's truck so we do we do have different requirements for parking as well as for where we're going to put the snow another intention is to promote the development of affordable home ownership options so restricting the number of consecutive small lots to no more than three in a row and mainly that is because of where you put the snow and when considering any proposed small lots we will require a covenant on title to ensure affordability for at least 10 years and a lot of that is simply because there is a lot of movement in the in the community still even with the amount of growth we have experience with people staying here another intention is to ensure a balance between community density design and affordability and council will only consider small lots in pre-zoned for mobile homes or newly created small lots in newly proposed subdivisions and council will prevent more that no more than approximately one third of the lots within a 10 hectare area of small lot development we do have one neighborhood that is entirely small lot and it is it's a nightmare there's a lot of parking on the streets unfortunately uh council will consider secondary suites and lane and carriage housing on residential lots of 550 meters square or greater if there's adequate space for parking and adequate space for snow storage so that just really goes to the concern that we have for for those we pull together an affordable housing committee that I chair very pleased to have the opportunity to chair that committee the the membership of that committee is extremely diverse the purpose of the committee is to aid in the development and delivery of community-based approach to affordable housing and the associated services within the city we will encourage affordable housing development within the city with developers and other housing providers in order to increase the affordable housing stock in the city the housing affordable housing committee will provide advice and recommendation on issues and policies pertaining to city-wide affordable housing on behalf of the community at large and they'll also review affordable housing proposals and recommend and provide recommendations to staff and council and that has already happened we were very fortunate that a developer came in and was seeking some higher density and we were successful in achieving that rezoning with the aid of our affordable housing committee because quite often councils will face a lot of backlash when there is going to be a higher density proposed and if you've got a committee of well-respected people from the community who very clearly indicate the benefit of this it really does help the council move forward on some of these things so the affordable housing committee by themselves created seven options for the council to consider and I'm pleased to say that council did review those in February of this year and they were all agreed upon and so I'll just zip through those here the first recommendation is prioritization developed based on current need in the community and the city's ability to assist and so we looked at low cost market as being the first priority simply because there was a lot of people moving here and if we did have some lower cost market housing that would move them through the continuum of housing in out of some of the rental stocks that we have presently and thereby freeing up some of that rental stock for those who were just moving to Fort St. John or unable to get a down payment transitional and supportive housing is a was our second priority and I'm pleased to say that the Salvation Army also recognized that and the Salvation Army is building a large new well renovated transition house and shelter for the community the low cost market ownership really is just makes things more affordable and this young family is to find their home base I was just down in Victoria the other day and on the plane on the way down it was a young mum going to a seashell to visit her parents while her husband renovated their bathroom and she had her little one-year-old child on her lap and they were able to afford a house in Fort St. John where they would not have been able to afford that house elsewhere the second recommendation is that we will consider changes to the land use based on a changing economic and social environment and that really speaks to the recommendation that came to council for rezoning the affordable housing committee stepped up and and spoke in favor of that recommendation the third recommendation really speaks to what needs to go into the decision for the ability to accommodate future housing needs and so the the decision-making points need to be the three boxes there projected population growth over the next five 10 15 years housing types that will be needed the size capacity and affordability and the current zoning capacity of future development sites so we do need to ensure that we consider those as we move forward fourth recommendation is to research and use appropriate policy and incentive-based tools to promote home ownership so we will leave no stone unturned we must be willing not only to look outside the box but also just to rebuild the box that we find ourselves in sometimes as local governments so we're looking at Saskatoon's housing business plan we've had conversations with the city of Langford and how they and the northern development initiative trust also has initiatives that as a municipality as a local government we can look at for tools to provide affordable housing a fifth recommendation is really to complete an inventory of vacant land and its potential for residents of residential occupancy presently you can see the different types of housing that we have what our current stock is and what the targets are within our official community plan so how do we move from 83 percent semi-detached homes currently to OCP target of 50 percent I think we can do it we are actually headed that direction how long that will take us who knows the sixth recommendation is to advocate that potential temporary work camps developed for site C be built in a similar fashion to the Olympic Village in order to be repurposed after the project used right across the the province I realized that you know there were some issues with what was done with the Olympic Village but I believe that that process has been tried and we can certainly work out the kinks then in speaking to BC housing I'm not hearing that it is not possible I know that there are several small communities that were beneficiaries of those units as they came across the province so we have not only site C but we just heard yesterday from TransCanada pipeline that they would be putting in several camps in because they're building two pipelines or they're proposing two pipelines and we need to ensure that we make the best use of the resources and the opportunities that are in front of us right now with those resource projects moving forward the seventh recommendation is to adhere to the accessibility requirements for housing set forth in the OCP so we are encouraging people to build their homes so that they are at least visitable if not completely accessible and we're finding that even with the cost being higher here in the north for for construction we have to recognize that in order to build even accessible homes it's really not that much more so those are the seven recommendations from the affordable housing committee that were approved by council so i'll just talk a little bit about the site C in their environmental impact statement they are projecting that 85 percent of trades will stay in the camp and 15 percent would stay in the city 85 percent of the supervisors would stay in the city and 15 percent in camp those are only the people who are working for the the project itself that does not include the those who would come up to accommodate working for some of the subcontractors they expect that this project will impact the city by driving our population rates ahead by three years so we're seeing a three percent gross rate per year that'll be a nine percent gross rate so it's going to be quite interesting it's going to create some market imbalance for rentals and ownership and they indicate that they feel that maybe three percent would be seeking temporary accommodations so this is just where i want to stick in the lng as well we hear a lot about the lng in bc's northwest and i can tell you from our calculations that i'm being very conservative here for every billion that is invested in bc's northwest there will be 3.86 billion invested here patronis the announcement that patronis made not long ago could drive that even further our planning curve sees us at 40 000 before we even consider plateauing keep in mind that the city itself is only at about 21600 in population right now so what the community really needs is for the province to provide the right policy and support so that we are able to manage these projects moving forward and i know that we we heard about how you know secondary suites and in all detached homes that's uh that that might be something that would be amenable in another location unfortunately that conversation has come up several times in in our council and has never passed fort mc murray however has got a a program where i think we might be able to take a look at it and that would really be if there's going to be secondary suites in every single detached home they must be able to provide parking and the owner would live there so that's the kind of thing that we would be looking at if we were to move forward with with that particular thing and um so with that um thank you very much and uh we'll take questions i guess well do you have this opportunity to provide some uh comments and questions and some good discussion i hope to ask both to prevent presenters and uh kind of uh gets the juices flowing on on on this really important issue i see there's going to be there's already a few in the q and a so we'll start from uh the top one that's come in and this one is actually for cameron um the question is is housing affordability tied to low interest rates what happens when interest rates move back up to historical rates is there is their government not forced to keep interest rates low indefinitely that's a real good question i think when we look at affordability there's three components and there's incomes are important prices are important and interest rates are important that's why i kind of rail against these whole prices and income ratios they ignore the fact that interest rates are at the bottom of a 25-year decline so if we weren't above our long-term average in terms of home price income ratios then we would be in a housing recession yeah interest rates are on their way up to the matter of when not if there's going to be begin at least on the short-term race next summer or the year after but interest rates will normalize coinciding with the economy firing on all cylinders now the when we look at the the normalization if you were where we're going to end up it's going to be a quite a slow and gradual rise in rates so i don't really expect it to to have a significant impact on the market other than this is that all those good things around of stronger of economic growth economy firing on all cylinders more jobs rising wages all those good things are supportive and accommodated as a housing demand but they're going to be largely offset in the next few years by normalizing rates which is going to start to chip away or road affordability so the combination of those two somewhat of a song i don't think there's a significant risk of you know 1981 or 82 style interest rates the Canadians are very sensitive to interest rates right now and i really don't see them going up dramatically but it is certainly within the realm of possibilities that you know if we look at let's say prime rate for example the prime rate could hit around five percent or so by the time interest rates fully normalize thanks Cameron and that's from Remy our next question is actually for Mayor Ackerman and this is from David how does Fort St. John define a small lot? Very good question we have you know what i know that our planner uses metrics and i'm not good at metrics so i i'm thinking it's if this helps 38 units per hectare and so the regular lots are more like 20 units per hectare. David does that ask your question you can put up a hand or or type in another question if you want some more specificity on that yeah and unfortunately we won't be able to use the uh the audio portion so type in your notes or if if he's interested if David's interested i can he can send an email or whatever works and i can get that information specific for him okay thank you we'll pass us some emails at the end of the session Office of Housing and Construction Standards h2 the question is actually back to Lori do you know whether a path to post costs more to build than a conventional home and if so by how much and that's exactly what we're going to learn when we're finished building it that's the reason why the city has taken it on as we're trying to show our developers that it can be done and with at a very similar cost or a cost that is close enough that the affordability comes in the operational part of it so we'll know that in a few months the next question comes from John and this is back to Lori what is the city of Fort St. John doing to build social housing or provide renter assistance we are supporting the Salvation Army and we provide some grants and aids through permissive tax exemptions but we don't actually build the social housing or provide renter assistance ourselves um i'll in fact you're you're the popular answer of questions Lori um Mayor Ackerman is there a link to your affordable housing committee report i can't seem to find it on the Fort St. John website yeah if you go into um it would be on our website under uh mayor and council and you'll see agendas actual agenda and you're looking for the February 12th 2013 um meeting and it is report administrative report number 0289-12 from Jamie Fort St. John finance the community amenities to maintain high livability in the face of such rapid population increase well that's a good one how will Fort St. John finance the community amenities amenities as in the nice um recreational amenities yeah i'm guessing it's sort of like uh talking about daycare community centers some of those uh community amenity pieces well the the city that's where you know i have mentioned at the end that we really do require the right policies and support in place to ensure that we can provide quality of place and quality of life to our to our residents we do have a fabulous recreational center that has uh North America's third speed skating um oval in it already we are just uh finishing off building a brand new fire hall here so how do we finance that it's uh we have a fair share agreement that um that we benefit from and um other than that it is we have development cost charges in place to ensure that the the most important amenity that being water and sewer is looked after any other questions that was kind of the list from the q&a unfortunately we can't um unmute the lines we have to keep it in lecture mode because we've got that um phone that keeps calling into the line for some reason oh here's another one from Dylan for lori what has your experience been in terms of working in partnership with the natural gas industry and bc hydro and planning for and developing workforce housing so our number one issue facing us of course is uh site c and um rather than taking a position on the make the lake committee or the dam the dam society we decided that no one wasn't in favor of the flood but he built an arc so the community had to be proactive and promote um our um our community and protect the assets that we had so we just um pulled together a very um in-depth conversation piece with the community and it's called let's see and you'll find that on our website as well we've just won three national awards and an international award for finding out what our residents felt about how their life would be impacted by these proposals moving forward um i can tell you that the natural gas industry has thanked us for providing that for them it's um where what we're saying to them is um we don't expect them to build us a fabulous community we already have a fabulous community just don't knock us off our compass bearing that we have established in our official community plan um we did all of this because of bc hydro um we've been thanked by the natural gas industry and hydro has said nothing does that help they've been nailed it um uh open to some other questions i actually have one or two that's uh to both you uh lori and to cam um and and then they're both demographic change issues um there's a lot of speculation of what the baby boom uh boomer generation will do once they retire um what do you think the impact will be on the availability and prices single detached homes once they sell and onto homes that they might downside to um where do you think there will be sort of the greatest impacts in the province um and and how might that affect the housing prices baby cam i'll pass it on to you first sure being a baby boomer uh i can't afford to retire so um now when we look at that kind of thesis was originally put out there by david foots remember the book boom bust an echo uh that was actually supposed to happen uh 2001 through 2006 it never really quite did and the idea was that you know because of demographic reasons the boomers the large single detached home in the suburb was going to be a white elephant no one's going to want it anymore and and the home prices may fall as a result of that um he admitted that that part was not entirely sufficient to to to manifest itself in reality um really when we look at all demographic forecasts and the most local one here of course the bc stats as their people model um we look at household growth or we look at age cohorts by uh or age cohorts and household growth we see that there will be sufficient demand uh for you know single detached homes in the suburbs going forward but the big growth the additional demand on the housing market is going to come primarily from seniors the lifestyle is over 55 years old going forward so you know in the next 15 years we're probably looking at three quarters of all additional housing demand is going to come from that sector or that those eight segments the boomers are taking the price on if you will and so that's going to have an impact on the way seniors housing is arranged um my my sense is that you know single detached home in major urban centers such as vancouver and victoria is becoming a smaller and smaller proportion of the housing stock um so i think that's a quite a countervailing force in the sense that prices in those markets will likely go up rather than go down if we look at the single detached homes in the future excellent lori howdy you've already talked a little bit about planning for wheels um do you what kind of impact of the the downsizing of the mirror generation in uh for st john well i think as it sits right now if we were to look out over the next 10 years even 20 years that baby boomers moving into smaller residents or homes would really ease up on the demand side here we've got a question coming in i'm guessing it's from the city of vancouver could be city victoria um put camera to comment on the impact of housing supply on affordability sure um well we look at and i had a slide about that earlier is that it's real difficult to to match supply with demand in in these kind of medium term cycles and so like i explained earlier you know this last cycle was kind of the perfect storm uh late 90s we had on the coast anyway leaky condo prices uh every second of third building at a janky tarp on it was like a uh a big billboard for first time buyers don't buy a home it's a hell of a risky investment and they didn't and that caused a lot of pin-up demand a well in the marketplace after 9 11 interest rates went down um consumers saw affordability and a big injection of of of liquidity in the market and as a result we saw a big run-up in sales activity without the supply just to satiate that demand and that caused prices to go up and so supply is very important oftentimes we see demand and and demand has looked in its solely itself but uh i'll just give you one example is in vancouver last year uh there was many uh there's a lot to talk of of the vancouver bubble that is finding first because sales were declining they're down 20 percent and 30 percent over year over year um but what happened was there was also a supply response where a well diversified market households with pretty strong balance sheets were really in in a position where they could say well wait a minute the market's not doing well i'm not going to put my home in the market so we didn't see supply get too far out of whack last year and in spite of the fact we saw sales fall to the cyclical low and upper capital basis lowest we've seen since the late 90s uh home prices actually only came off about four and a half percent for the year and so far this year they've been made up of both half of that another question here from quarry and i'm maybe it's to both camera and lori any advice for small communities valmont has about a thousand residents very little rentals available almost none and high-priced housing how much of it not lived in full-time vacation housing for letters et cetera so is valmont considered a resort community i guess um i know that some communities are and they've got different opportunities for growth um besides all of that it's really about just as you would with a business retention and expansion program for your community if you're trying to bring in okay if you're trying to bring in investors sometimes it's the people who we've already got there that might be willing to expand on their housing stock and invest in more rental for you um as far as i can tell you as far as um you know that the high-priced housing people who live in high-priced housing actually quite like the equity that shows up and really some some people are just not interested in what they would refer to as flooding the market with more housing to decrease the value of their house so you walk a fine line there but if you know your community and you have a you know a strategy for inviting investors in then sometimes it is going to take the community to invest in itself and go out and meet with those investors and promote your community. I just like to add that with small communities in bc you've got to be careful about or at least be cognizant of population growth when we have areas a lot of areas have even in the north is doing actually so well in this post recession period um many communities have pretty flat population trajectories so you know adding additional units to the marketplace may or you know may not be the the the appropriate thing to do at least in terms of of attracting people there because you know basically you have to have demand before that supply is added to the marketplace so I guess a careful consideration about you know is there sufficient demand for this rental housing we can you know zone forward or provide incentives for it but people actually have to have to want to live there the other part to my question which is around demographics that touched on the baby boomer segment but also looking at this gen y or young people which is now kind of being termed there's sort of the renter generation so we hear a lot of young people with difficulty finding solid jobs after university or college and about this boomerang generation of folks who move out of their parent homes and have to move back in for financial reasons how do we see and I'll pass it to you Kevin first how do you see that affecting the housing market over the long run um I think that there's a number of strategies are deployed number one I think that you know young buyers or first time buyers are ever increasingly older I mean I hated my generation where you know we bought our homes typically in our 20s now it's kind of gets pushed out to the 30s um some of that is because education is much longer we have a longer period in university or technical schools for example in which they're you know they're not ready willing and able to buy a home um but I do think that one thing I've I've certainly noticed about uh the younger generations is if you want to color the the eco generation or even earlier later is that um they really want to be located close to urban areas and amenities and are certainly less likely to want that uh you know single attached home with all the maintenance and balls with mooring the lawns and cleaning the gutters to them proximity seems to be very important um and I think that bodes well with you know sustainable housing initiatives or density initiatives walkable communities all those kinds of things that are dovetailing together in urban areas throughout North America talked about um you know uh you're a young city do you think they'll have ramifications to the to the young population in your housing market uh no we had um the affordable housing committee had a um some mortgage advisors come in and speak to us about you know affordability and they indicated to us that um if you are gainfully employed here in Fort St. John and you can't afford a house um it's because you perhaps made some bad um credit choices earlier in life I can tell you that my youngest child she's now a 27 has been in her own home uh since she was 24 and uh not that I'm complaining but her house is way nicer than mine but she's got more to clean and so I I meet people here on a regular basis a young people who have moved up here and uh have come up to to buy their own home and um you know I just got a couple of emails yesterday friends of people who want to move up here and uh and get jobs up here and uh because they want to get into the to the real estate market they want to own a home and they're just unable to own a home elsewhere I just want to add to that on the demographic side of it you know we're about to see quite a transfer in sort of wealth from the boomer generation uh to the echo generation a part of that's coming not as a result of of the death rate if you will it's the result of transferring a portion of equity that have been built up by the boomers to their to the children through home equity lines of credit or or similar vehicles in order to help them out with their down payments and there's a significant amount of younger home buyers today that are being helped out by their you know relatively house rich parents today I would I would definitely see that as a factor especially in my cohort who is the 30 to 40 group and especially in in Metro Vancouver I have time for just one more question if if folks um in the ether want to post one to the board if if not I'm going to wrap things up we're about um we've got about five minutes left before we have to to to wrap up the webinar so I'll leave a couple of seconds for anybody who has a one last burning question to post on and the Q&A for either Cameron or Lori okay well um I want to thank everybody today for uh for joining us we've kind of reached the end of the time for the webinar I want to thank our speakers for taking today and to share the information with us I think it's been a great kickoff to our pilot webinar series and we hope to see folks who have joined us at our actually if you can go to the next slide in November around where do housing costs come from I just inside take a look at a performance see what makes and breaks the housing project and then in January we'll talk about secondary suites we'll have two local governments come in and talk about what worked for them what doesn't what are some of the issues they've had around this kind of gentle densification before we sign off I want to again thank our industry partners Darby's going to put the Cameron and your Akamins email information I also want to thank so much Darby and the economic development branch for providing us coordinating and and and during the technical process and doing a lot of the coordinating for this for this webinar I also want to say that we do have a survey that we're going to be sending you in the next little bit that I'll just give you give us some feedback about about the webinar today and any suggestions that you have for and also here's a resource page of links to some of our partners and some of the pages that find it useful and helpful I also want to thank my cohort who helped to organize these webinars Dale Anderson who works with me at the Office of Housing and Construction Standards. Another note too is that this webinar is being recorded and will be archived on the rural BC website along with temporarily some of the resource materials such as PowerPoint so please feel free to log back in or let other that this information is available and I will turn it over to Darby to say goodbye. Thanks very much everyone thank you Natalia as well for helping us out and again I just yeah I'd like to thank Ginny and Dale for so much coordination the content of the webinar thanks very much to our presenters and please I'm just going to re-emphasize that survey we really appreciate your feedback on the survey helped us make these webinars as good as they can be and keep your eyes on that email coming to you in the next couple days. Thanks everyone and thank you