Why is housing in Canada so Expensive? … Is there a Fix?

Peter Thiel, Elon Musk and other?PayPal Mafia members developed a formula on how to?build successful Billion dollar companies like Planatir, Tesla and SpaceX.

“Find an important truth about something you believe to be true,

that very few people agree with you on,

figure out a?Factor 10?times superior solution and

become one of the companies to build the future.” [1]

Discovering an important truth about why there is a Housing Crisis in Canada and fixing it would be a worthwhile problem to solve, considering that we have the “Most Overvalued Housing in the World”. ?

There is currently a shortage of?2,000,000 affordable homes and growing.?As Canada increases immigration to address labour shortages the demand for rental housing will be driven even higher.?The cost of financing a home is also increasing as mortgage rates rise to control inflation.?A shortage of labour, material and development lands are driving up development and construction costs. These costs are all in addition to the time, cost and effort it takes for a development approval process that takes way too long. It currently that takes four years of approvals after land purchase, plus another three years to build. ?

To solve the major gap in the availability of affordable housing we are going to need a new way of thinking about fast tracking developments. This is why Premiers Doug Ford and David Eby are enacting legislation in Ontario and BC to open up more land plus enable much faster development permits so more homes can be built faster.

What needs to Change?

To address the challenge of building significantly more homes at less cost and faster we need three things to change.

1. Municipalities need to think differently on how to build sustainable developments on fringe land, where land costs are a Factor of 10 less expensive?than the land currently planned for urban development. Development lands with-in the?Urban Containment Boundary are $250,000 per lot for land serviced by municipal infrastructure as opposed to the $25,000 per lot we need for more affordable housing.
2. Municipalities need to think differently to allow servicing of less expensive fringe lands with Pre-engineered Packaged Treatment Plants designed to rigorous standards. These packed plants exist and can be less costly to install and operate while enabling?safe and economically viable development of much less costly fringe properties.?
3. Municipalities need to adopt a lean and more collaborative approach too fast track the development process. This requires?faster decision making which is achievable with lean approaches that focus on production, eliminating waste and dealing with?issues and constraints effectively.

Building sustainable developments on less expensive land, servicing with pre-engineered infrastructure and speeding up the development process, seems to make sense, that is why we developed The Verandah Model.

What is The Verandah Model??

The Verandah Model was developed to help solve the housing crisis while also addressing climate change by building more affordable NetZero rental communities.?The solution tackles land cost, servicing and speed of development issues head on with an economically viable alternative approach.??

The proposed 10X better solution is to develop NetZero Compact Rental Homes on fringe lands arranged in Pocket neighbourhoods of medium density serviced by pre-engineered packaged solutions.?The site servicing costs are much less with stand alone pre-engineered systems as there is minimal distribution to the land. Sustainable developments?require less roads and servicing that is just below grade is less costly.?

Projects will be delivered using lean methodologies that will enable the building of?150 homes per year per site delivered at a minimum of?20% less cost. This is achieved by eliminating waste, improving work flows and using prefabrication to supplement the production capacity of the local work force.

To ensure that communities are built to the highest level of sustainability The Verandah Model has committed to Living Communities Challenge (LCC) certification.?LCC certification is key as municipalities can rest assured that the community will be designed for social well being, be NetZero Energy and Water, constructed with materials that have no negative impact on the environment and that there are transportation systems that are not dependent on fossil fuels or owning a car.

?The Verandah Model enables 10x lower lower land costs per unit by building on fringe lands made possible by Pre-engineered water and sewer systems. Development costs are further reduced by building for people as opposed to supporting a car culture.?Developing around a people first community as opposed to a car culture also saves in road building and sewer and water infrastructure costs.

In summary, the Verandah Model will enable 10x less land costs, 15% less road and utility infrastructure cost and 20% less construction cost due to the compact designs and lean production efficiencies. As an added bonus, all homes will have NetZero energy costs as the whole community will be powered by grid connected PV panels.?

When you add this all up, YES the Verandah model can deliver affordable and sustainable NetZero rental housing. All we need to change is our approach to deliver LEAN & GREEN?by changing some of the rules. Not in a way that sacrifices sustainability but rather in a new way of thinking about development process and the implementation of pre-engineered municipal waste water treatment systems.

Looking for a Champion

The important truth that all communities need to realize is that it is impossible to build?affordable homes on expensive land using the current set of development rules and processes.?For lots more affordable homes to be build we need a new way of thinking and champions willing to take solutions like The Verandah Model forward.

Fortunately with the Verandah Model, there is minimal risk as we check all of the boxes for being One of the World’s Most Sustainable NetZero Rental Communities. We have the expertise on board to deliver Waste Water Treatment to the highest standards and 30% of our units will qualify as Affordable Housing as defined by CMHC.

If you are someone that truly wants to make a difference enabling affordable NetZero rental housing in your community, connect with us so together we can help solve the Affordable Housing crisis while taking action on Climate Change.

For more information about The Verandah Model ?www.theverandah.ca

Also feel free to connect with the writer Murray Guy, [email protected]

[1] Zero to One, How to Build the Future, Peter Thiel