Sunday 2 October 2022

Land and $s

As usual, housing issues are dragged into the election discussion.  For our municipality, other issues should have a higher priority.   Not to suggest that housing is a not a worthy topic, now more than ever, but as designated in the Regional Growth Strategy, North Saanich's priorities are aligned more with rural and agricultural attributes.

Notwithstanding this clear imperative, we are drawn into the "housing debate" through various arguments, many of them poorly grounded.  Although many residents, and some candidates, offer glib and knee-jerk "solutions" to the housing challenges, almost none offer practical solutions.  Although many claim to support "affordable housing", almost no one explains how it can be achieved.

There are many articles explaining why the "build more" approach will not make housing affordable.  This is especially true in North Saanich, where land prices are very high, probably among the highest in the CRD.  Affordable housing implies that all components of the dwelling be obtained at a lower cost, including the land.

One argument often advanced for reducing the land cost component is "densification."  Again, there is no explanation of how this really works.  If it did work as advertised, we could not draw the following graph.

It plots land prices for each of 20 representative lots in North Saanich against the lot sizes.  The lots range from .074 to 2.5 acres.  The smallest parcels are at Canora Mews, the others are nearby.  The land values are from the 2021 BC Assessment.

Also plotted is the land value per acre which allows us to compare "apples with apples" for properties of widely varying sizes.  The graph is quite revealing:

  • although property sizes vary considerably, the land cost for them does not.  That is shown by the almost flat blue line in the graph.  Rural acreages are not enormously more expensive than a cheek by jowl lot, land only.  
  • the orange line however, tells us the same thing but more graphically.  The tiny lots at Canora Mews are assessed at about $4.9 million per acre while 1/3 acre lots in Dean Park Estates come in at $1.5 million per acre.
So, it would seem that carving larger properties up into smaller ones does very little to reduce the land cost of the dwelling package.

With this in mind, make sure you ask those candidates who are flogging the "build more" and "build denser" solutions to the housing problem, how they really plan to achieve true affordability.

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