New development charges will put even more stress on Alberta’s residential construction industry: BILD Albert

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Alberta’s residential construction industry is in crisis, says the Building and Land Development (BILD) Alberta Association.

Fewer residential construction jobs, fewer affordable homes and uncertainty surrounding proposed legislation have crippled the industry, the association says.

Steve Bontje, BILD Alberta board chair and managing partner at Laebon Homes in Red Deer, said the association hears from “members every day who have had to make the difficult decision to lay off staff.

“The ripple effect is far reaching, work order to skilled trades partners have been cut by at least a third,” the Red Deer Advocate quotes him as saying.

There are more than 5,000 unabsorbed new homes on the market, resulting in a significant reduction in housing starts.

BILD Alberta said new mortgage rules have cooled the housing market across the country, and now the provincial government is proposing new legislation, Bill 32, that would further impact housing affordability.

“The last thing our industry needed was more uncertainty around things like whether costs will be added,” Bontje said. “The best thing you can do to get the industry moving again is giving certainty and confidence that investments (people) make are going to work out.”

The City Charters Fiscal Framework Act will provide Calgary and Edmonton with predictable infrastructure funding tied to provincial revenues, as well as long-term transit funding, allowing the two municipalities more freedom to add new development charge levies.

“It’s frustrating for industry because those are significant changes that were made without any meaningful conversation about what it might mean for the consumer,” Bjonte said.

Bontje said the average Albertan’s ability to afford a home is “slipping away.” “We have to be very aware that any further cost increases … end up adding to the price of lots.”

The legislation has yet to be approved.

BILD Alberta CEO Carmen Wyton, said for every $10,000 increase in the price of a home, 20,000 potential homebuyers are eliminated from the market in the province.

The “industry needs to be consulted before changes are made that result in less young families and first time home buyers from home ownership,” Wyton said.

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