Not approving enough affordable housing, little growth in rentals that will suit young families and too few "missing middle" homes put a damper on Victoria bringing more units online in 2023 than it has in any one year over the last three decades.
Hitting 1,567 homes completions last year marked the highest annual total in the capital city since the mid '90s, according to Victoria's yearly housing strategy review.
Like it has in past years, the city exceeded its goals for the number of condo and market-rental building permits it issued. Victoria issued 570 permits for market rentals in 2023, almost double its annual target of 300.
The city had less success on meeting its markers on housing affordability and creating a diverse supply of homes.
Victoria fell short of approving 350 rentals that would be affordable for those with very low, low and median incomes.
"No units for median income households were approved this year," city staff said in a report on the housing review.
Victoria also missed the mark on issuing enough permits for missing middle homes – which are houseplexes and townhomes that bridge the gap between single-family dwellings and larger apartments. Council revised the city's missing middle regulations last year to make them less restrictive. Despite the missed target, there was a 60 per cent jump from 2022 in the number of permits issued for the ground-oriented missing middle buildings.
The city isn't creating enough three-bedroom homes, staff said in their report. There are only 279 three-bedroom rentals in the city and no new ones were added to the Victoria market between June 2022 and July 2023.
The city says its poised to meet its overall 2025 housing supply target thanks to approvals in recent years. Progress toward that goal, however, slowed in 2023. The city only issued permits for 739 net new homes last year, well shy of the 1,000 it aimed for.
“Persistent shortfalls in housing supply compared to demand has led to a shortage and driven up the cost of existing homes - either to rent or to own,” city staff said. “The supply of housing we do have is also lacking in terms of the types of homes that are available to meet the needs of households with different income levels, lifestyles and sizes.”
Average sale prices for all home types decreased in Victoria for the first time since the pandemic, but staff said costs remain “stubbornly high." The average condo was almost $650,000 in 2023, according to local real estate figures, while a townhome went for a $850,000 and a single detached home ran prospective buyers $1.3 million.
Rent costs increased by almost 7 per cent last year, reaching $1,515 per month on average.
Data released earlier this month from the Canadian Mortage and Housing Corporation (CMHC) showed 538 homes were completed in Victoria through the first four months of 2024. That figure led all Greater Victoria municipalities over the four-month period.
Almost 1,700 homes were under construction in Victoria during the month of April, which was about 1,000 fewer than the number being built in Langford that month.
The CHMC data shows there were 16 new housing starts in the city from the start of January through April, while Langford had 785, Colwood had 318 and Saanich had 150 over the first third of 2024.
