Kelowna seeking affordable housing options

Housing affordability is such a complex issue that Kelowna city councillors need a second workshop on the issue.

“There are questions about what incentives and tools can the city deploy to encourage more affordable housing,” said James Moore, the City of Kelowna’s infill and housing policy manager. “Questions like ‘can we adjust our tax incentive program to target affordable housing? Can we increase our land acquisition for affordable housing? How can we use our density bonus program?’” Moore told councillors on Tuesday.

“They are all smaller sub-questions of the larger question: What incentives and tools can the city use to encourage more affordable housing? We’ll dive into those issues in detail at that workshop.”

The city needs fresh data and should conduct a housing needs assessment, said Moore, so all these tools and incentives work together in a housing strategy.

Moore said the housing needs assessment offers an opportunity to recalibrate the city’s approach to the changing conditions of the housing system. It will deliver a comprehensive estimate of existing and future housing needs and will set the groundwork for clear targets and measures.”

Council now has an opportunity to take a fresh look at its approach to housing and set a renewed strategy for years to come, he said, and take direct action on an issue that is critical to the community’s wellbeing.

Kelowna is struggling to meet what seems like an insatiable demand for housing. Between 2016 and 2021, the city’s population grew by more than 13%. The city responded with several incentive programs and has also issued permits for more than 11,500 new homes during the past five years.

Of those new homes, 78% were multi-unit in 2022 and 78% were located near transit and amenities. Rental housing was also a major source of accommodation. However, the full impact of these units on the housing supply has not been seen as many are still under construction, said Moore.

“Housing affordability, broadly speaking, is a complex problem to which no local government has found a singular ‘one-size-fitsall’ solution,” he added. “Instead, each local government is working within their own unique context to address an issue that has become one of the most pressing challenges facing our communities and our country.”

Moore pointed to the high cost of housing locally, pointing out the monthly mortgage costs for the average detached home sold in Kelowna in 2022 would exceed $6,000 and the average monthly cost for a condominium sold in 2022 would be nearly $3,000.

“For comparison, the average Kelowna household earned $105,300 in 2020. At this level, monthly mortgage cost alone, excluding other shelter costs for a condo, would occupy 34% of their pre-tax income and 41% of their after-tax income, suggesting that the average household would be hard-pressed to afford ownership housing,” Moore said.

Kelowna’s high rental rates provide little relief, he added. “Due to a vacancy rate below 1%, costs for a one-bedroom apartment average $1,817 per month, and two-bedroom units rent for an average of $2,580 per month.”

Those low vacancy rates and high costs lead to higher levels of homelessness and shelter use, he said.

“Kelowna has long been a leader in working to address housing affordability.

“The city was an early adopter of secondary suites and carriage homes, and has pushed that success forward into the new forms of missing middle infill housing,” said Moore.