It's like the city doesn't understand basic economics at times.
It is even worse on small residential projects. For example, one of the many things, they will make a builder or owner-builder replaced the entire frontage of the sidewalk (irrelevant of existing condition)/boulevard curb where the driveway is and the re-asphalt once the curb is replaced. Ohhh yea, and the company you are using has to be approved by the city.
All of their policies add immense cost, percentage wise, to a small project. You can't exactly hire uncle Bob to come do curbs/re-asphalt.
I think within 24 months it won't be possible to find a single family home in City of Victoria on a 5,500 sq/ft lot under $1,000,000.
Condos will need to up in price too with all the crap being thrown at bigger projects.
New house in Oakland's area. Previous sidewalk was just fine.
.. this is not how real estate economics works, real estate prices are not a function of costs + profit. You cannot arbitrarily pass down costs to consumers. A unit is worth whatever the market will pay. Think of it the opposite...if a developer could get 505K per unit instead of 500k per unit, they are not going to charge 5k less.
What basically happens is increases in project costs act as a level that at a certain point will make the project with its current unit mix and type unfeasible. (this can mean increases in costs if the developer has to switch to a higher price point project, but the quality of the product would need to increase as well).
This CAN have a market wide increase in prices if the extra costs incurred by the city make it harder for developers to leverage land, thus less land is brought to market and then supply/demand economics come into play.
(note this has nothing to do with Vancouver vs Victoria markets, its consumer behavior and real estate economics)
Source: Director of real estate economics at UBC and other prominent researchers
Edited by attica, 02 November 2015 - 08:36 AM.