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EPISODE DESCRIPTION
Episode 99: Matt and Taylor are joined by Ryan Smith. Ryan is the Divisional Director of Planning and Development Services for the City of Kelowna from Kelowna, BC, one of the busiest planning and development teams in Canada. Ryan has worked for the city of Kelowna for more than 20 years, and won numerous awards for leadership, volunteerism, and his commitment to helping others.
Ryan's 1st Appearance in Episode 39: https://KelownaRealEstate.podbean.com/e/39-ryan-smith/
Ryan is here to discuss: → Updates to the STR, short-term rental, regulations, the future of short-term rentals in Kelowna, and the potential impact of new federal government housing policies on the city. → Understanding DCC fees, where they go, and if they will change, building applications not keeping up for housing demand in Kelowna, the difficulty of getting projects to pencil and constant building code changes creating development roadblocks. → The arrival of infill housing in the Kelowna suburbs, Kelowna's power-grid infrastructure problem, and the realities of running a website chatbot.
City of Kelowna Website: www.kelowna.ca
Ryan Smith's LinkedIn: @RyanSmith
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Kelowna Real Estate Podcast: @kelownarealestate
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CONNECT WITH MATT
Matt Glen's Website: www.mattglen.ca
Matt Glen's Email: matt.glen@century21.ca
Matt Glen's Instagram: @mattglenrealestate
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CONNECT WITH TAYLOR
Taylor Atkinson's Website: www.venturemortgages.com
Taylor Atkinson's Email: taylor@venturemortgages.com
Taylor Atkinson's Instagram: @VentureMortgages
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Okay, welcome back to the CloneReal Estate Podcast.
(00:01):
I'm your mortgage broker host,Taylor Atkinson.
And I'm your real estate agenthost, Matt Glenn.
What's happening, Taylor?Hey, sun's out, man.
Is it ever?it ever?
Went for a walk this morning.
Freaking gorgeous, man.
Yeah, it kind of started methinking about like, what's going
to happen in the city?You know, I know last summer, it
was so sleepy with Airbnb andeconomically, just people probably
not traveling.
Yeah, it'd be interesting to see
(00:22):
what happens.
But I mean, speaking about the
city, our guest today.
Ryan Smith, two -time guest.
He's awesome to talk to.
I love having Ryan on.
Yeah, man.
He's got to know like...
All the inner secrets of.
He doesn't just got to know it.
doesn't just got to know it.
He does know it.
Yeah.
You ask him the questions.
He's just like on the ball.
I love having him on as a guest.
Yeah.
So we had him on the day that
(00:42):
Airbnb legislation was announcedthat basically like provincial
restrictions were coming out.
And it was in a morning episode.
So we only heard like an hourbefore Ryan shows up.
we only heard like an hour beforeRyan shows up.
We didn't really have our ducks ina row to ask him any questions.
So that was kind of funny.
kind of funny.
Well, it was a great episode.
Yeah.
I mean, kudos to him.
It was really nice for him just to
be open and transparent and just,you know, trying to talk about
(01:03):
where we were at at that time.
Because that was the day that the
province announced.
the province announced.
It wasn't the city of Kelowna.
It's not like his announcement.
Yeah.
We just had to deal with it like
you're all of us.
We just had to deal with it like
you're all of us.
So since then.
The city has made more strictguidelines than the province.
And then they've just likereversed those essentially this
spring.
You did say in this show, you
know, potentially in a year fromnow, we'll see what CMHC vacancy
(01:25):
does.
They'll have to kind of revisit it
again.
But I guess the takeaway there is,
you know, the city of Kelownadoesn't want this like up and down
volatility of decisions, right?Which is fair.
He said that he's like, He saidthat we don't want to yo -yo rules
every year.
Like how are you supposed to plan
anything like that?Yeah.
But speaking of Airbnb stuff, soour neighbors a little bit south
in Penticton, they went to councilon April 1st for the property
(01:47):
that's being built, Sokana.
We've had people on for Sokana
before.
And I'm personally invested in
Sokana.
So this makes me kind of happy.
They voted three to one in favorof allowing it to be Airbnb or
what they called is like a stratahotel complex.
So that's a huge positive.
I mean, not just where I'm
(02:08):
standing, but I think like.
Just think of all the people that
bought in there.
You included the roller coaster.
You buy in there, expect it to beat Airbnb.
They get shut down.
Then you're like explaining to
yourself and all the people thatbought in there like, oh, you're
not going to build an Airbnb.
The rental market's down.
And now it's back on all this.
Like you're on a roller coaster
tied in where you can't doanything, but just enjoy the ride.
(02:29):
I love roller coasters.
I do not love this ride.
So phase one down there is a 96unit complex.
I think their argument to councilwas like, hey, we did this as a
performa that these were going tobe Airbnb allowable.
And we sold them like that.
And now we can't market it that
way.
And like, it just doesn't pencil
anymore.
So what do you want us to do with
(02:52):
the project?Anyways, it seems like city of
Penticton is like.
Yeah.
Pushing behind in the right way.
So hopefully we'll see that.
When you look at that project,When you look at that project,
like it is in a perfect place tobe an Airbnb, like right at the
center of Colonia, like thechannel there, right at the beach,
right in the commercial district.
It's kind of perfect for an Airbnb
there.
Yeah.
Some of these just make sense.
And there's a lot of those in
(03:13):
Colonia as well.
So hopefully we'll see that come
out.
we'll see out.
Absolutely.
Yeah.
And what about inflationannouncement?
Yeah, so 1 .7 inflation.
That kind of caught me off guard.
I was not expecting.
It dropped a lot.
Yeah.
Kind of unexpected to see that.
I guess with tariffs maybe nothaving the effect yet, so
inflation could go up again.
(03:33):
Yeah, I feel like there's got to
be a bit of a lag there, but we'llsee.
Feels like we've been talkingabout tariffs for months, though.
I know.
So like, could we see a drop in
interest rates coming up maybesometime?
I know.
Yeah, I mean, I think we're still
predicting like half a point ratecut by the end of 2025.
But again, like not to dive toomuch into this, but the issue
(03:55):
there is now lenders are likeshrinking their discount on prime.
So does it change like borrowingcapacity or payments a lot?
Not really.
but it probably provides more
optimism in the market.
Yeah, it seems like it's a step in
the right direction.
Yeah.
At least so.
We want to get to the show.
Awesome one with Ryan Smith, Cityof Kelowna, and enjoy it, guys.
Yeah.
And this episode, like every
episode, sponsored by Century 21Assurance Realty, best brokerage
(04:16):
in town.
Our head office is in Kelowna, but
we've got offices in Casagar,Kamloops.
We're around.
So if you're an agent looking for
a switch or a buyer or sellerlooking for an agent, give us a
shout.
Enjoy the show.
Okay, welcome back to the show.
Ryan Smith, City of Kelowna.
How's it going, man?Great, guys.
How are you?Doing well.
Glad to have you back.
You're a fan favorite, for sure.
(04:36):
Yeah, thanks for inviting me back.
Fan favorite or like super villain
over short -term rentals?Fan favorite, I think.
Although, yeah, I guess the short-term rental thing does stick in
people, but definitely a fanfavorite.
You know what, though?Love it or hate it, that was one
of our most downloaded shows.
So, you know, kudos to you.
Yeah, I mean, I think that youguys were probably...
(04:59):
In terms of like who I'd talked topublicly about that, probably like
the first ones.
And so, yeah.
Well, it happened like thatmorning.
Yeah.
Yeah.
So that was crazy.
Yeah.
Yeah.
So Taylor didn't have time to get
all worked up about it before yougot there.
So it doesn't take me long to getworked up.
So So doesn't take me long to getworked up.
Yeah.
It wasn't the first one.
There were many.
Yeah.
So, I mean, So, I mean, speakingabout that, that was.
(05:22):
what, just over a year ago now, Iguess, when we had our first
recording with you.
Do you want to give like a quick
recap on where we're at with thatlegislation?
City's made some recent changes,but...
When the provincial legislationcame in, the provincial
legislation came in, we took thatand we actually added another
layer and made it even a littlebit stricter.
And at the time we did thatbecause of the vacancy rate
numbers that we were seeing inKelowna, which were at the time
(05:44):
about less than a percent.
It was like 0 .7 percent vacancy
rate.
And we said to council, look,
there's a serious issue here andit's having like lots of economic
impacts on the community.
And so that really limited to
about, you know, 450 or 500, thenumber of like existing licenses
that could be used.
We said at the time, we'll review
it for next year.
(06:04):
And we don't know, like there's
lots of rental housing underconstruction.
This may be overkill.
And by November of last year, when
CMHC released the rental vacancyrate early, we saw that it had
jumped up about three and a halfpercent.
I think it was 3 .8, which waswhere we were hoping it was going.
And we thought, OK, that interimmeasure of being extra strict was
(06:26):
no longer necessary.
And so we kept our word and that
review and we went back to counciland said, hey, you know, the extra
bit of Kelowna specific regulationwas overkill.
Let's just align ourselves withthe province for now.
And so that's where we sit nowaligned with the province.
that's where we sit now alignedwith the province.
I should point out that at thetime there was all sorts of.
(06:47):
accusations about tourism beingdown just because of the short
-term rentals.
I was going to ask you, like, what
you thought brought that up.
Well, we were like, okay, well,
let's step back and take a look atit.
And is there a direct correlation?And we couldn't find, like, a
smoking gun of data saying, youknow, hotel vacancy and prices
were up a little bit.
So we went to destination tourism
to get data on that.
Yep.
Destination BC, tourism data.
(07:08):
We went to talk to Tourism
Kelowna.
You know, we were hearing from
lots of businesses that tourismwas down.
But there was also, you know,fires the year before that, bad
press over, you know, winery andgrape growing troubles and all
these things that I think combinefor a perfect storm.
So it wasn't any one thing, butcertainly I would say it's some
level of contributing factor.
There's probably eight or nine
things that have an impact.
(07:31):
And Kelowna is so complicated,
like any city, that not just onething when you see something acute
like that going on is to blame.
So are you going to review this
again next year or is this justthe way it is going to be?
Yeah, really good segue.
If our vacancy rate remains above
3%, when CMHC reports it againnext year, our council could
(07:51):
choose to opt out of theprovince's regulations.
So they'll have that opportunity.
So they can do a resolution and
send that to the province.
That would be for like condos like
Aqua and stuff like that.
Yeah, Yeah, that'd be Aqua, you
know, all the buildings.
Playa del Sol and stuff like that.
Yeah, in any building, Playa delSol and stuff like that.
Yeah, in any building, certainlywe could open it back wide open
for short -term rentals.
What would that... look like i
(08:15):
don't exactly know but if thatvacancy rate remains above three
percent which given the number ofrental housing units still under
construction and occupying likealmost every week another rental
building is occupying right nowyeah i'd say there's a pretty good
chance that it's going to be abovethree percent so we'll report back
to council it'll probably be likea january -ish report january
february and have a discussionwith council about Where do they
want to go with this?Do they want to opt out?
If so, do they want to opt outwith any special roles?
(08:37):
What's the city staffrecommendation?
And what we don't want to end upin is a situation, though, where
we allow it and then.
Two years after that, we're going
back the other way again.
You're yo -yoing with relations.
And everybody who's making, like,you guys are making, like, but
your clients, you guys are makingreal estate decisions about this.
It's like, how do you do businessin that atmosphere?
(08:57):
So there needs to be someconsistency.
over time.
And that's what we recommend to
council.
If we're going to remove some
restrictions, maybe there's a bitof a hybrid where some of those
investor properties, maybe we opensome of those up.
Like that's, I think some of thethings we'll think about and talk
to the provincial government abouttoo.
Those things that's going to dogus for a few years, for sure.
(09:20):
with relations.
And Yeah.
I mean, in terms of, I guess.
Do we want to like jump right into
kind of development and buildingstats?
Like, you know, it's prettyinteresting right now, but maybe
you have obviously the data thatwe'd love to kind of dissect.
What's going on in terms ofbuilding applications and stuff
like that in the city?How are you guys looking?
If you drive around Kelowna rightnow, you drive around Kelowna
(09:42):
right now, there's craneseverywhere, construction going on
everywhere.
And you're like, we're in a boom.
Like we don't have a problem withhousing.
And maybe right this second, wedon't have a problem with housing.
But we take a long view approachto housing.
And there's a lot of rentalhousing under construction because
we had a lot of incentives inplace between us, the provincial
government and federal government.
Yes.
To help that happen.
What you don't see a lot of is
market condos under construction.
You've got the Aqua being built.
(10:03):
You've got Movala.
Yes.
To help The ones that started along time ago.
But they started a long time ago.
Yeah, yeah.
And what we haven't seen, though,is anything new permitted that's
going into construction that'll bedone three years from now.
Yeah, yeah.
that's going into construction
that'll be done three years fromnow.
You're expecting maybe a bit of ashortfall?
Yeah.
So, Yeah.
So, I mean, we could end up in asituation where, you know, the
(10:26):
rental vacancy rate pops up to,you know, 5%, 6%, 7 % for a year
or two.
Yeah.
But the problem is with no newmarket housing.
being built, multifamily markethousing, or very little.
And like two or three years fromnow, all that extra rental stock
starts to get sucked up by peoplewho can't find housing to buy on
the market side.
And then you've got another two or
(10:47):
three year, four year constructioncycle for stuff to get.
permitted to get underconstruction.
So it could be like a volatilenext few years.
And so we're seeing all of thesebuildings occupy, but not when I
look at it.
And we've got a housing dashboard
online that's available to thepublic if you search our website.
And you can really see the storyof what's going on.
2022, 2023, lots of buildingpermits, fewer occupancies.
And then 2024, 2025, lots ofoccupancies, so far building
(11:08):
occupancies, not a lot of buildingpermits and new building permits.
Some projects like market condoprojects come back to be re
-permitted because through theplanning process, development
permits only good for two yearsunless they get a foundation in
the ground.
So there was one that we did in
February on Clement.
There's another one next Tuesday
night on Ellis Street, a big fourtower, a thousand unit Lettingham
(11:30):
McAllister proposal.
And they get another two years.
And hopefully in that two years,they can start.
Other than that, there's like,we'll see a few more of those.
There's not a lot compared to howmuch housing we need a year.
Our housing needs assessment saysbetween like 1 ,650 and 2 ,600 new
units a year.
And these years, we're certainly
not going to hit it.
And I keep telling council this in
(11:52):
years, you know, probably late2026 to 2029 is what I'm worried
about.
Interesting.
So it's funny because we need morehousing.
You can see it laying out prettywell right now.
But if the numbers don't pencil,the numbers don't pencil.
So how do we get ourselves overthat hurdle?
What do you think could happen?Yeah, and that's a challenging
thing in a time like this wherethere's all this construction
(12:16):
going on.
Yeah, and that's a challenging
thing in a time like this wherethere's all this construction
going on.
And everybody looks at that again
and says, why would we givedevelopment incentives?
And just to get something goingthat's new doesn't pencil, like
you said.
And there's probably a thousand
reasons why these things aren'tpenciling right now.
And you've got building codechanges, financing changes at the
CMHC level that have happened inlots of municipalities, like
(12:39):
constant zoning changes,development cost charges that keep
going up.
All of these things are really,
really challenging.
Maybe those would be
controversial, but what is withall the building code changes?
It just gets more and moreexpensive by the second, it seems.
If you applied for your permit sixmonths ago, you have different
building codes than you do now,and it's just...
Do they not realize that we needmore housing and it just makes it
way harder?Everybody has a different
priority, has a differentpriority, but it's the most
(13:00):
important priority.
I think governments have a problem
really like sifting through thatand saying, no, these two or three
things are the most importantthings.
And we're going to focus onsupporting these.
And those other things are notpriorities.
And so with building code, allsorts of things have become a
priority at the same time withbuilding code.
And it's just layering andlayering and layering.
We're doing like energyefficiency.
We're doing accessibility.
We're doing the structural side in
(13:21):
terms of making buildingsearthquake resilient.
And that's just the building code.
And not to mention, like, you
know, Citi adds in electricvehicle charging requirements and
then, you know, X, Y and Z abovethat.
And I'd say Kelowna is probablybetter than many others at
prioritizing.
But still, I think that.
And Governments need to starthaving a look at themselves and
saying, you know, what is thepriority here?
I said it on LinkedIn last week.
When everything's a priority,
(13:41):
nothing's a priority out there.
No, exactly.
How do you figure out what themost important things are?
And if we're in a housing crisis,where are the 18 other things a
priority as well?So I guess like as a municipality
that gives feedback to theprovince, what is kind of the one
priority that you're saying, hey,this has to happen at our level,
like for the city of Kelowna to beable to get to the state that we
(14:03):
need to?Because there are like so many
things.
working against us, right?
Like tariffs come in and it'slike, well, how do we know the
cost of the next building wheneverything might go up 25 %?
So yeah, focus our feedback tothings that are within our
control.
And like we could talk either like
development cost charges and likeprobably our biggest feedback to
(14:24):
the province is on the electricalside of things.
And that's a challenge at a bunchof different levels, like the
local infill housing level.
And there's like whole areas that
are challenges.
And then there's the overall like,
what does our city look like inthe future?
And how is power impacting that?Because there's a discussion to be
had there, too.
Yeah.
So I think I originally reachedout to you a few months ago
because we had some like prettyoutrageous headlines, basically.
(14:45):
saying, you know, a Fortisinfrastructure is not going to
fulfill the building needs fordevelopers, potentially as late as
like 2029.
Where are we at with that?
Like, it kind of seemed like itcame out.
I saw a bunch of these headlinesand then it just stopped recently.
But yeah, I guess what's the issuethere?
know, Fortis approached us about18, 20 months ago and said, hey,
look, in a couple areas of thecity, our substations are running
out of capacity.
and particularly one in the north
(15:05):
end of downtown and then one onRichter Street on Saucier.
The Saucier one was the mostimmediate, but they do long -term
capital planning.
But the problem was is that their
delivery time on equipment isthree to four years.
And so they're ordering a capitalplan, got out of sync with our
growth management side of thingsand how we are planning and like
what's going to happen when interms of development and where and
(15:26):
wasn't lining up that well.
And so we ended up with challenges
in those two particular areasfirst.
And there's a few other areas withmore minor challenges.
So we've been meeting to figureout how we deal with projects that
are going ahead in those areas.
And we created an earlier review
and warning process fordevelopers.
And then we've been also workingcase by case or developers have
with Fortis to try and change theenergy load that buildings are
(15:50):
creating to lessen it so thatpotentially they can still be
energized in those areas as well.
We're working with Fortis.
They need to actually expand ortwin the recreation substation,
which is right near Redbird.
I always relate everything to
breweries.
Yeah.
We're that age.
We're like, everyone's made it.
Yeah, we just do exactly wherethat was.
Yeah.
So in that area, we need another
substation.
Yeah.
But it lands at a premium.
(16:12):
So it's challenging to find
something in that area, trying tofigure it out.
It's not like a short -termsolution for either one of those.
But I would say we're making younothing hasn't been able to be
built yet that's sort of beenpermitted because of those
challenges.
But we may still run into that at
some point.
The thing we're also working on is
(16:32):
in a lot of our alleys in thecentral city, there's overhead, my
power pole Fortis infrastructure.
But with the amount of infill
housing happening, a lot ofpressure is being put on that.
And the locations of those polessometimes prevents housing and
infill housing or carrot houses.
And so we're going to try and work
with Fortis on what the future ofthose alleyways looks like and
that infrastructure, because wecan't have individual projects.
(16:54):
Like if you're building a fourunit building and you get hit with
like an $80 ,000 power bill,that's not sustainable in a
project.
That's never going to work.
And how can Kelowna strategicallyget involved?
to help.
We already do laneway
improvements, but maybe we need tocoordinate those better with
Fortis so that power goesunderground and new transformers
go underground.
There's ways we can deal with
(17:20):
that, so we're trying to figurethat out.
not Because that can affect aproperty.
I've been personally involved in afew of these where you have a pool
that's in a bad spot in the alley.
That property that would be a
prime development lot is all of asudden basically not saleable.
It's kind of a crazy situation.
So oftentimes, oftentimes, like if
that property does moveinfrastructure around, they front
end the cost for that.
(17:40):
But there's no recovery mechanism.
Anybody else that gets to takeadvantage of that doesn't pay into
it afterwards.
No, exactly.
That's right.
The model needs to evolve and
improve so that if other peopleare getting in a benefit, model
needs to evolve and improve sothat if other people are getting
in a benefit, everybody pays theirfair share.
And then that way the cost getsreduced for everybody too.
(18:03):
We all agree that infrastructurein a growing city needs to evolve
and be improved, but it's just howyou allocate the costs.
Also, it just wouldn't look waynicer and around.
So I think that's...
Oh yeah, Oh yeah, totally.
Yeah.
Yeah.
I mean, honestly, probably nota... bad problem to have.
Like if you're growing as a city,these are the things that you're
going to come upon.
(18:23):
I guess maybe a bit of a segue
into like DCCs.
So first of all, I guess two -part
question, like can you expand onwhat DCCs go to?
And the second part would be, areyou looking at tweaking some of
those to incorporate some ofthese?
So like one owner doesn't have theonus of that $80 ,000 bill and
then everyone else gets it.
Like, is there a way to
restructure that so it's morebeneficial?
DCCs are actually like a kind of ahigher order tool.
(18:45):
And so I'll explain that a littlebit.
There's sewer, water, road, park,storm drainage projects that are
like either whole neighborhood orsector of the city related or
whole city related.
Say we wanted to four lane Richter
Street in the future.
That's something that benefits
like a large area of the city.
So we use the DCC program.
So many new units pay a sharetowards that.
(19:06):
Plus there's an amount built intothat DCC charge for.
existing users that are benefitingfrom that as well so when that
road actually gets built maybe 50or 60 of that road the need for
that was related to new growth Andthen 40 % is paid by existing
users, which would come fromtaxation.
But maybe we also, to bring downthe cost, want to subsidize that
even a little more and we callthat an assist factor.
What we do is when we update ourcommunity plan, it's every five to
10 years, we'll do an update tothe DCC program.
(19:26):
And the DCC program, then we say,here's the major projects that are
funded by DCCs and figure out foreach project how much funding is
required.
And do we need to buy land or will
developers give us some of theland because land along that, you
know, maybe it's a corridor, we'llget redeveloped.
You figure all that out to thebest of our ability and then
review with the home builders andthe Urban Development Institute
and go through almost like line byline, haggle over the cost of it.
Sometimes to make the program moreaffordable, projects need to come
(19:49):
out of it.
It's funny that everyone says
there's no transparency to it, butI sat in 15 meetings before the
last update where we talked about,you know, meetings before the last
update where we talked about, youknow, oh, well, there's a material
cost in this road project that Ithink is unreasonable.
Why is it there?What's behind it?
(20:10):
And we have to explain that to thedevelopment community.
So from that perspective, I wouldsay there's transparency.
But if you're out there in thecommunity, you hear the term DCC
and people complaining about it.
It's a tough one to sort of wrap
your head around.
That's a really like simple DCC.
The whole development industry isbasically paying towards specific
global community projects.
(20:30):
Good example of that would be the
Hart Park that opened lastweekend.
A portion of that was built usingdevelopment cost charge park
construction money.
And we would be able to say, if
you said, oh, well, how much?development money went into that,
our team could say, oh, well, theamount of new units that were
happening in this neighborhood, wecharged them this amount or this
amount was contributed to that andtaxation, which was like the
(20:53):
existing area residents whobenefit paid X amount towards it
as well.
So it'd be great if there was
actually like a really transparentway to see that.
And that's one of the problems.
Like there's a lot of smart
accountants and engineers who workon it behind the scenes.
If we did like a video every yearthat explained like, here's where
your DCCs went this year, there'dprobably be better buy -in from
(21:15):
the development community too.
Yeah, I mean, I don't think anyone
can really dispute that it's notbeing spent in good.
projects like i mean i was just atthe heart park a couple days ago
with the kids it's amazing youknow so i think when we had you on
last show you know you saidsomething along the lines of we're
kind of shooting yourself in thefoot in terms of it's becoming a
very expensive city but it'sbecause we're reinvesting in these
(21:37):
amazing amenities and that's justlike a perfect example of it you
allocate those dcc fees where youwant and you're never going to
make everyone happy not just makepeople happy but but Keeping
people informed, like are peoplereally going to want to watch the
accountant bringing down thenumbers or even a video of that?
I mean, I mean, I think when youshow where it's going and how
much, who's paying for what,that's kind of interesting.
(21:58):
how But yeah, like the line byline stuff, yeah, is a little bit
boring.
And it's actually an interesting
time though with DCCs.
I find it interesting, but I'm a
nerd, so maybe not so much.
So in the new liberal government's
housing platform, and I'm assumingthat they're going to be acting on
this.
They had a commitment to cut DCCs
in half.
Does that have anything to do with
them?How do they do that?
(22:19):
We're going to see, going to see,I guess.
What's your opinion on that?Are they just going to pay the
other half?They said that for the half that
we're not collecting, they willreimburse with a formula.
But I think that that formulameans that we only recover about
half of what we're giving up.
So we're still missing about 25 %
of that.
So that certainly impacts the
community.
Hopefully there's some room there
as the implementation happens onthat to figure this out.
(22:40):
I mean, I think, again, if housingis the priority and that's one of
the tools that we have to helpease the crunch for developers and
home builders, that's fine.
But we hear from the community
constantly here in Kelowna thatyou're not building enough
infrastructure fast enough.
And so then if we're not funding
it properly, that makes it eventruer than it is today.
And I mean, I think where we getbehind is times like COVID where,
you know.
Prices went through the roof.
(23:01):
Things were so unpredictable thatwe were really unproductive in our
infrastructure delivery programsfor a few years while we were
still building housing.
But we couldn't predict, you know,
some of those costs were insaneor, you know, we just weren't sure
whether or not we could create aproject.
And we've wrapped that up againthis year, next year, the year
after, and you see way moreinfrastructure built.
And driving around right now, youcan already see that in the
community.
So hopefully, we hopefully, yeah,
(23:21):
we're made as whole as possible onthat so that the community and the
infrastructure side of things thatpeople.
think less about doesn't suffer.
What excites you about the new
liberal government policies forhousing at our municipal level or
provincial level?Yeah.
Are there any policies that havecome out that you're like, I
actually think they're going toreally hit this one out of the
(23:41):
park and follow through with it.
And like, we're excited to
implement it as a city.
It'll be interesting to see.
They talked about like Canadabuilds program or build Canada
program.
Like the modular housing thing.
Well, actually, yeah, there's twothings.
If the federal government getsinvolved.
In housing, I don't think theyshould do it to compete with
developers in any way, shape orform.
I think the development industrycan serve the top two thirds of
the people of Canada quite well.
(24:03):
But where I think it's failing is
the very affordable housing outthere and like shelters and
helping those out that have likemental health and addiction
issues, like housing and treatmentfor that.
So if Canada is going to getinvolved federally, that's the
spot for it.
So I'd be excited to see them and
very involved.
And it seemed like that's what the
campaign platform said.
(24:24):
And then the other part of it is,
yeah, the modular prefabricatedside of things and seeing the
federal government help the SRIsof our region could produce for
years on end at full capacity,knowing that, for instance, the
government might buy off theirexcess supply.
Then they could borrow forimprovements and technology
upgrades and expansions and nothave to worry about market cycles
because that's what kills thoseplants now.
You know, they ramp up and thenthey have to lay everybody off and
(24:46):
then they ramp up again and itjust kills production.
So if they can produce at a higherlevel long term in the region and
the ones that get bought off bythe government become affordable
housing supply, I think everybodywins.
Places like that are where thegovernment should be involved, the
de -risking and not in competitionwith development.
not competition with development.
I like that.
That's a good point.
I feel like the modular housing
and the infill that we're going tobe having in Kelowna, like it's
(25:08):
like a match made in heaven.
It just feels like the two are
just made for each other.
Because the modular houses are
super nice places, right?They're not like mobile home
parks.
They're like real houses.
And they're very nice.
Nothing wrong with mobile homes
either, man.
Nothing wrong with mobile homes.
But like I'm just saying downtownis not going to turn into a mobile
home park.
Like they're very nice places.
Well, in the assembly, I was like,once you've built a foundation and
(25:30):
like with the plumbing, you coulddrop like four units onto that.
in a day yeah exactly yes you knowbe ready to like putting on the
outside finishing and like thoseare quick projects if the
inventory is available yeah andlike from a technology perspective
one of the other things that getsme excited is i mean maybe you're
selling a property buyer's agentcomes and says like well what can
(25:51):
we do with this and you can saywell check out the city's website
it'll walk you through what youcan put there yeah then you can
figure out okay well that'seligible for four and it will
suggest yes know be ready to likeputting on the outside finishing
and like those are quick projectsif the inventory is available yeah
and like from a technologyperspective one of the other
things that gets me excited is imean maybe you're selling a
(26:15):
property buyer's agent comes andsays like well what can we do with
this and you can say well checkout the city's website it'll walk
you through what you can put thereyeah then you can figure out okay
well that's eligible for four andit will suggest prefab designs
from a bunch of different prefabbuilders or designs that are maybe
non -prefab too, that will fit onthat property and then say, okay,
(26:37):
well, if you want it to go prefab,here's the time it would take to
fulfill your order.
Or if you wanted to use a regular
builder, here's three buildersthat are ready to go in the next
six months and could start.
And that might involve some
collaboration with the Canadianhome builders locally.
And they've got like a great, well-organized chapter here.
And, you know, if they could drivebusiness and juggle clients based
on that.
I mean, it's funny, I sort of
supervise the construction of thegrowth of the community.
(26:57):
But if I had to go build my ownplace and I didn't have some of
the context that I have right now.
Where do you start?
Who do you use?How long is it going to take?
Like most people have no idea ifyou're not in the industry.
I have right now.
Where do you start?
Who do you use?Even meeting someone like Taylor
to finance it, like talk toTaylor, just all these different
options.
I agree.
Go to one place and you just haveall these options.
(27:20):
It would just like streamline theprocess.
What banks do this?What banks do this?
And what are the advantages anddisadvantages to each?
Like there's no reason that wecouldn't be the hub of that
information.
Out of, you know, a simple sort of
software process that walks youthrough step by step by step.
And we've sort of started that.
We have a chat bot for our infill
housing that helps.
But I think we'll see that
(27:41):
hopefully grow over the next fewyears.
And I've got a manager in ourhousing area who's really
passionate with that.
And I think he'll be able to pull
it off.
Nice.
I was going to ask about the chatbot.
Do you guys have like top 10questions or what are people
mostly asking that they don'tknow?
I was just so curious what theconversations are.
That's maybe another video.
maybe another video.
Let me go back and get the data.
Like I deal mostly in the data
logs, like how many people areusing it?
When are they using it?And so we have like 100 to 200
people a month using our variouschatbots in our area.
And mostly during business hours,smaller percentage evenings and
weekends type thing.
When we actually talk about them
in the media, then the use goes uptoo.
our It's about to skyrocket.
Yeah, if you post this, it will
get more likes even from that.
Or I was talking about our
(28:02):
chatbots in Calgary on Monday onthis technology panel that I was
on.
Somehow my 10 -year -old tells me
like I'm terrible at Minecraft.
He's been trying to teach me how
to acquire them.
And he thinks it's hilarious that
I'm so bad at video games, but yetI'm presenting at conferences.
I'm talking about artificialintelligence.
That's awesome.
I'm not the guy who could tell you
exactly.
like how the software works or
(28:23):
anything else, just our experiencelike using it so far.
And one of the things actuallythat we're finding is that the
chatbots, once you get them goingand they're answering questions
for people, they're meant toanswer like, you know, in our
building process where we launchedthem first, we get tons of
questions about like swimming poolconstruction, for example, and how
high fences need to be aroundswimming pools, what are the
setbacks from property lines orthe house and all those types of
things.
That's what gets asked pretty
frequently.
But if you don't maintain the
chatbot, it actually starts to getdumber and answer questions.
(28:43):
Oh, really?I'm not even lying.
I had a conversation about ityesterday with one of our tech
guys.
And he said, yeah, that's one of
the challenges that we're having.
I don't know if it's because the
chatbots aren't getting likepositive reinforcement or what.
I don't know enough about it.
it. So we all have to do our part
and go ask questions to make ussmarter.
I actually think it's because thechatbots are pointed at like
(29:04):
specific bylaws and areas forinformation.
And so if we're changing in thoseareas, how that information is
worded or presented, then it'spulling things out.
It'll misinterpret.
And when it's putting them into
its own words, I think that'smaybe what's going on.
But yeah, again, as a guy who'slike not the expert, I'm just a
liberal arts planner.
I'm not an IT guy.
That was pretty funny.
I feel like I can relate to the
(29:24):
chatbot.
If I don't get positive
reinforcement, I'm just...
You just start lying.
You don't need a fence there.
That's fine.
Well, I think there's some dangerin that because we're actually
giving people advice.
We start getting terrible building
permit submissions for certainthings where they're all
consistently wrong in the sameway.
Our chatbot's called Kai, so it'sprobably Kai's fault.
But again, it's like a naturalgrowing pain that we have to
(29:44):
evolve that way, right?Like to speed things up and make
it more efficient.
Yeah, I think if we weren't...
trying to use new technology,there'd be a signal to our
community saying, what's our localgovernment doing?
They're not trying to be moreefficient.
They're not trying to provideservice to us in a more convenient
way.
And we'd be getting criticism over
that.
And we're actually a great size to
be testing those things because ifwe're putting wrong information
(30:05):
out there, it's not like we're ina city the size of Surrey.
We're like, you know, six or 700,000 people are getting terrible
information.
We're a little bit smaller than
one.
So, you know, maybe we see it show
up.
with a couple of people in the
next two months.
And I say this consistently, staff
(30:26):
can also give the wronginformation too by accident.
And so, I mean, it's not the firsttime it's happened and won't be
the last.
Yeah.
Yeah.
Well, and by implementing some of
this stuff too, like you guys aregetting grants at a provincial and
federal level too, right?Oh yeah.
You know, you're gettingrecognized as like an innovative
city.
So therefore there's benefits to
it.
Oh yeah.
Big time.
Big time.
Yeah.
Yeah, I get invited to tech panels
(30:48):
that I have no business for.
That's awesome.
Maybe one question.
I'm just curious about single
family houses, building permits onthat level.
You know, we kind of spokeobviously about condos and maybe
some purpose built rentals.
Are we seeing much activity on any
kind of building permits forsingle family homes?
Or is that just kind of sitting bythe wayside now?
(31:08):
Yeah, it's pretty consistent.
We see between like.
200 and 350 a year in Kelowna.
There's actually no such thing as
single family zoning anywhere inKelowna.
Right.
That kind of ended last year when
the province changed all itslegislation.
That kind of ended last year whenthe province changed all its
legislation.
Yeah.
But we still see people buildingsingle family homes, obviously.
And about 70 % of the singlefamily homes that get built have
(31:31):
secondary suites in them now.
That is awesome.
Kind of an interesting stat.
But you could do single family
house, secondary suite, carriagehouse, depending on your lot if
you wanted to now and do itlegally.
Or you could do... fourplex or twotwos.
So we're starting to see thattrickle out into some of the
(31:52):
suburban neighborhoods now.
It used to just be a center of the
city thing in Kelowna.
And now, you know, in the lower
mission, you're seeing a few.
And there's great concern over
this in the lower mission.
And I don't know if people weren't
paying attention to the news lastyear, but this is something that's
provincial.
I was going to ask you, have you
(32:12):
seen like any specificflashpoints?
Yeah, I mean, yes.
The first few applications that
we've approved for three or fourunit buildings sort of in that
lower mission area, we're hearinglike great concern over that.
And we did water down.
The provinces, like their zoning
regulations that they asked us toimplement quite a bit from what
got implemented in the center ofthe city to sort of the suburban
Kelowna, like Glenmore, parts ofRutland, and the Mission all got a
(32:34):
lighter touch.
And we complied with the
provincial legislations.
And I'm saying this publicly.
It's not like we circumventedtheir rules in any way.
But it was just sort of a lightertouch.
a bit But When this stuff happens,it's complicated.
It's not put in language that theaverage person living on Sarsen's
Road understands.
We did actually quite a bit of
advertising last year about ourinfill programs and what was
happening.
We had bus stop advertising.
(32:54):
But thinking back, I don't know ifI pay attention to any bus stop
advertising.
Especially not the kind of people
that are going to be bitchingabout a fourplex next door.
Yeah, Yeah, exactly.
We've been advertising at the BMW
dealership.
That's actually a good idea.
I'm going to do that next time.
Yeah, I actually have a couple of
lots for sale on McClure and likeall the interest we've got is four
(33:16):
plexes.
And I'm just like, hey, this is
interesting.
And some of those lots are like
the parking is really sort of thelimiting factor.
some of those lots are like theparking is really sort of the
limiting factor.
Can you get the parking on and
comply with our bylaws?And we're actually been pretty
strict on that because in thoseareas, lots of people have, you
(33:38):
know, the two and three cars.
And so trying to make sure that
they get the minimum number ofparking stalls and being
inflexible on that front.
Yep.
to Nice.
We'll see more friction in that
area as more of the city starts tosee different housing types end up
in their neighborhood.
And I think we had our biggest
year last year for infill housingfor like the four to six unit
level.
see more friction in that area as
more of the city starts to seedifferent housing types end up in
(34:01):
their neighborhood.
And I think we had our biggest
year last year for infill housingfor like the four to six unit
level.
And we did 45 permits for those.
And I think success in my mindwould be if five years from now we
were doing a couple hundred ayear.
Really?Yeah.
If we were doing a couple hundreda year and of those couple
hundred, if 30 or 40 were modular.
I think that that would be a
(34:22):
really good news story.
That would be awesome.
would be awesome.
How do we get to that level?
That whole combination ofavailability for modular housing,
whole combination of availabilityfor modular housing, partnerships
with Fortis, trying to make thingseasy on that front.
continuing to make sure ourprocess here remains streamlined.
And then maybe, Taylor, you cansay better than I can.
But like borrowing for those fourunit buildings is a little bit
(34:46):
different, I think, isn't it, thanborrowing for like a house and a
suite?It is.
Yeah, they are coming out withsome great programs that they
have.
But still, even at the government
level, like CMHC, a lot of lendershaven't allowed those policies
yet.
They're like, yeah, we have the
information from CMHC, but wedon't really know how to implement
it in our own underwritingguidelines.
So there's like a lag there.
You know, it's coming.
(35:06):
It's coming.
have the Yeah.
So that's I think that like lotsof things will come together in
the next few years.
There's financing, there's
development process, there's theconstruction, the power aspect of
this and making sure that's right.
And I think it will come.
I think we're doing the rightthings in Kelowna.
The pre -approved designs, too,that we have.
(35:26):
We're expanding that catalog ofpre -approved designs.
Well, there are some federal.
pre -approved designs, will adopt.
And hopefully if builders canbuild the same versions of the
same thing over and over too, thatwill help speed up the approval
process for infill housing.
Yeah, well, we had a great episode
a few months back.
It was a two -part one.
We brought you guys on withSandbox as well to go over some of
(35:47):
their designs.
And I went to that infill housing
day as well.
It was awesome.
So yeah, you guys are doing goodthings.
We appreciate it.
Yeah, some of one of the other
bits that we might look at doingis some speed funding to get
infill going.
There's lots of property owners
who are like, like land rich andcash poor.
A lot.
I've talked about that a lot.
Yeah, but maybe they have two kidsthat are just finishing up at
University of Calgary or NAIT ordown like at UBC and want to come
back.
The house isn't right.
(36:08):
They've got a small mangala.
How do they do it?
They want to build something fortheir kids and then they sell a
couple of units on the property orsomething like that.
Like how do they afford to dothat?
And how do they pay for thedrawings, the DCCs to get it
rolling?And so we've been talking with a
couple of different small housing,BC, middle from Alberta about, you
know, how we make that work.
And so, you know, if we got some
extra money from the federalgovernment for our housing
accelerator projects, we may rolla project like to help more infill
get going.
So you'd essentially like partner
with the existing homeowner.
We would loan money to get things
(36:29):
going and then they would pay usback on the end with a little bit
of interest.
We would loan money to get things
going and then they would pay usback on the end with a little bit
of interest.
Like we're essentially acting like
a small bank anyway.
And then we would roll that into
another project and hopefully webuild up our capital to invest
over time.
And, you know, we start with, you
know, two or three projects ayear.
(36:51):
And then, you know, 15 years fromnow, we're doing 30 or 40.
That would be awesome becauseyou're right.
That is a major need.
Yeah.
And it's not being fulfilled.
Like the banks aren't quite there
yet.
And yeah, I mean, I think there's
lots or maybe for whatever reason,like they just don't fit the risk
profile.
But we think they're low risk and
who they partner with, thatthey're partnering with
established groups who are, youknow, can help them project manage
(37:12):
it the whole way through.
And we trust them.
Then, yeah, I think.
Yeah, that would be a huge factor,
But that would be a huge factor,too.
But yes.
on the right track?
It's going to be a reallyinteresting next, I would say,
year to see what the federalgovernment does first.
I think they need to move prettyquickly on the housing front.
And so if the GST exemptions forfirst -time home buyers will
probably happen quickly, do theyallow foreign buyers to buy new
(37:35):
housing?That could happen quite quickly.
The DCCs may or may not be morecomplicated.
I'm thinking of...
Everything we'd need to change
here when we're changing our DCCbylaw, I don't know what tools
they have to like order us to doit and how that works out.
I know that the provincialgovernment is also considering
changing the time when DCCs getpaid with a construction project.
That would be awesome.
Yeah.
From when we issue building permitto when occupancy permit is.
(37:56):
Yeah.
And that would be a big deal for a
lot of people.
Like just those three things
coming together, I think start tochange the way that developers are
looking at the housing market.
But there's probably some more
fundamental change andprioritization that needs to
happen in this country over thenext five years if we want to be
like consistently deliveringhousing.
Back to the priority sort ofdiscussion.
We keep seeing provincial andfederal government get more
(38:17):
involved in municipalitiesbusiness, but it's for good reason
because like the priorities areall over the place.
I think a component to that ismeasurement too.
The province is already measuringhow much housing we're producing.
CMHC is already measuring us in abit of a different way.
But, you know, across.
Canada, hopefully we'll see the
federal government say, OK, thatthe communities that streamline
their processes the best to acceptand permit housing and are working
well with industry to do that.
(38:38):
We'll get their fair share of
infrastructure dollars and grants,because that's what we've not been
seeing is sort of our fair shareon that front here.
We've been good performers, goodpartners with government, and we'd
love to continue to be that.
It's like the infrastructure help
is a really big, big piece to thepuzzle.
Love it.
Awesome.
Well, thank you so much for comingon.
I mean, yeah, we love havinganyone from the city come on, but
(39:00):
you're awesome, man.
So yeah, I appreciate it.
Yeah, appreciate it, guys.
Okay, welcome back to the CloneReal Estate Podcast.
(00:01):
I'm your mortgage broker host,Taylor Atkinson.
And I'm your real estate agenthost, Matt Glenn.
What's happening, Taylor?Hey, sun's out, man.
Is it ever?it ever?
Went for a walk this morning.
Freaking gorgeous, man.
Yeah, it kind of started methinking about like, what's going
to happen in the city?You know, I know last summer, it
was so sleepy with Airbnb andeconomically, just people probably
not traveling.
Yeah, it'd be interesting to see
(00:22):
what happens.
But I mean, speaking about the
city, our guest today.
Ryan Smith, two -time guest.
He's awesome to talk to.
I love having Ryan on.
Yeah, man.
He's got to know like...
All the inner secrets of.
He doesn't just got to know it.
doesn't just got to know it.
He does know it.
Yeah.
You ask him the questions.
He's just like on the ball.
I love having him on as a guest.
Yeah.
So we had him on the day that
(00:42):
Airbnb legislation was announcedthat basically like provincial
restrictions were coming out.
And it was in a morning episode.
So we only heard like an hourbefore Ryan shows up.
we only heard like an hour beforeRyan shows up.
We didn't really have our ducks ina row to ask him any questions.
So that was kind of funny.
kind of funny.
Well, it was a great episode.
Yeah.
I mean, kudos to him.
It was really nice for him just to
be open and transparent and just,you know, trying to talk about
(01:03):
where we were at at that time.
Because that was the day that the
province announced.
the province announced.
It wasn't the city of Kelowna.
It's not like his announcement.
Yeah.
We just had to deal with it like
you're all of us.
We just had to deal with it like
you're all of us.
So since then.
The city has made more strictguidelines than the province.
And then they've just likereversed those essentially this
spring.
You did say in this show, you
know, potentially in a year fromnow, we'll see what CMHC vacancy
(01:25):
does.
They'll have to kind of revisit it
again.
But I guess the takeaway there is,
you know, the city of Kelownadoesn't want this like up and down
volatility of decisions, right?Which is fair.
He said that he's like, He saidthat we don't want to yo -yo rules
every year.
Like how are you supposed to plan
anything like that?Yeah.
But speaking of Airbnb stuff, soour neighbors a little bit south
in Penticton, they went to councilon April 1st for the property
(01:47):
that's being built, Sokana.
We've had people on for Sokana
before.
And I'm personally invested in
Sokana.
So this makes me kind of happy.
They voted three to one in favorof allowing it to be Airbnb or
what they called is like a stratahotel complex.
So that's a huge positive.
I mean, not just where I'm
(02:08):
standing, but I think like.
Just think of all the people that
bought in there.
You included the roller coaster.
You buy in there, expect it to beat Airbnb.
They get shut down.
Then you're like explaining to
yourself and all the people thatbought in there like, oh, you're
not going to build an Airbnb.
The rental market's down.
And now it's back on all this.
Like you're on a roller coaster
tied in where you can't doanything, but just enjoy the ride.
(02:29):
I love roller coasters.
I do not love this ride.
So phase one down there is a 96unit complex.
I think their argument to councilwas like, hey, we did this as a
performa that these were going tobe Airbnb allowable.
And we sold them like that.
And now we can't market it that
way.
And like, it just doesn't pencil
anymore.
So what do you want us to do with
(02:52):
the project?Anyways, it seems like city of
Penticton is like.
Yeah.
Pushing behind in the right way.
So hopefully we'll see that.
When you look at that project,When you look at that project,
like it is in a perfect place tobe an Airbnb, like right at the
center of Colonia, like thechannel there, right at the beach,
right in the commercial district.
It's kind of perfect for an Airbnb
there.
Yeah.
Some of these just make sense.
And there's a lot of those in
(03:13):
Colonia as well.
So hopefully we'll see that come
out.
we'll see out.
Absolutely.
Yeah.
And what about inflationannouncement?
Yeah, so 1 .7 inflation.
That kind of caught me off guard.
I was not expecting.
It dropped a lot.
Yeah.
Kind of unexpected to see that.
I guess with tariffs maybe nothaving the effect yet, so
inflation could go up again.
(03:33):
Yeah, I feel like there's got to
be a bit of a lag there, but we'llsee.
Feels like we've been talkingabout tariffs for months, though.
I know.
So like, could we see a drop in
interest rates coming up maybesometime?
I know.
Yeah, I mean, I think we're still
predicting like half a point ratecut by the end of 2025.
But again, like not to dive toomuch into this, but the issue
(03:55):
there is now lenders are likeshrinking their discount on prime.
So does it change like borrowingcapacity or payments a lot?
Not really.
but it probably provides more
optimism in the market.
Yeah, it seems like it's a step in
the right direction.
Yeah.
At least so.
We want to get to the show.
Awesome one with Ryan Smith, Cityof Kelowna, and enjoy it, guys.
Yeah.
And this episode, like every
episode, sponsored by Century 21Assurance Realty, best brokerage
(04:16):
in town.
Our head office is in Kelowna, but
we've got offices in Casagar,Kamloops.
We're around.
So if you're an agent looking for
a switch or a buyer or sellerlooking for an agent, give us a
shout.
Enjoy the show.
Okay, welcome back to the show.
Ryan Smith, City of Kelowna.
How's it going, man?Great, guys.
How are you?Doing well.
Glad to have you back.
You're a fan favorite, for sure.
(04:36):
Yeah, thanks for inviting me back.
Fan favorite or like super villain
over short -term rentals?Fan favorite, I think.
Although, yeah, I guess the short-term rental thing does stick in
people, but definitely a fanfavorite.
You know what, though?Love it or hate it, that was one
of our most downloaded shows.
So, you know, kudos to you.
Yeah, I mean, I think that youguys were probably...
(04:59):
In terms of like who I'd talked topublicly about that, probably like
the first ones.
And so, yeah.
Well, it happened like thatmorning.
Yeah.
Yeah.
So that was crazy.
Yeah.
Yeah.
So Taylor didn't have time to get
all worked up about it before yougot there.
So it doesn't take me long to getworked up.
So So doesn't take me long to getworked up.
Yeah.
It wasn't the first one.
There were many.
Yeah.
So, I mean, So, I mean, speakingabout that, that was.
(05:22):
what, just over a year ago now, Iguess, when we had our first
recording with you.
Do you want to give like a quick
recap on where we're at with thatlegislation?
City's made some recent changes,but...
When the provincial legislationcame in, the provincial
legislation came in, we took thatand we actually added another
layer and made it even a littlebit stricter.
And at the time we did thatbecause of the vacancy rate
numbers that we were seeing inKelowna, which were at the time
(05:44):
about less than a percent.
It was like 0 .7 percent vacancy
rate.
And we said to council, look,
there's a serious issue here andit's having like lots of economic
impacts on the community.
And so that really limited to
about, you know, 450 or 500, thenumber of like existing licenses
that could be used.
We said at the time, we'll review
it for next year.
(06:04):
And we don't know, like there's
lots of rental housing underconstruction.
This may be overkill.
And by November of last year, when
CMHC released the rental vacancyrate early, we saw that it had
jumped up about three and a halfpercent.
I think it was 3 .8, which waswhere we were hoping it was going.
And we thought, OK, that interimmeasure of being extra strict was
(06:26):
no longer necessary.
And so we kept our word and that
review and we went back to counciland said, hey, you know, the extra
bit of Kelowna specific regulationwas overkill.
Let's just align ourselves withthe province for now.
And so that's where we sit nowaligned with the province.
that's where we sit now alignedwith the province.
I should point out that at thetime there was all sorts of.
(06:47):
accusations about tourism beingdown just because of the short
-term rentals.
I was going to ask you, like, what
you thought brought that up.
Well, we were like, okay, well,
let's step back and take a look atit.
And is there a direct correlation?And we couldn't find, like, a
smoking gun of data saying, youknow, hotel vacancy and prices
were up a little bit.
So we went to destination tourism
to get data on that.
Yep.
Destination BC, tourism data.
(07:08):
We went to talk to Tourism
Kelowna.
You know, we were hearing from
lots of businesses that tourismwas down.
But there was also, you know,fires the year before that, bad
press over, you know, winery andgrape growing troubles and all
these things that I think combinefor a perfect storm.
So it wasn't any one thing, butcertainly I would say it's some
level of contributing factor.
There's probably eight or nine
things that have an impact.
(07:31):
And Kelowna is so complicated,
like any city, that not just onething when you see something acute
like that going on is to blame.
So are you going to review this
again next year or is this justthe way it is going to be?
Yeah, really good segue.
If our vacancy rate remains above
3%, when CMHC reports it againnext year, our council could
(07:51):
choose to opt out of theprovince's regulations.
So they'll have that opportunity.
So they can do a resolution and
send that to the province.
That would be for like condos like
Aqua and stuff like that.
Yeah, Yeah, that'd be Aqua, you
know, all the buildings.
Playa del Sol and stuff like that.
Yeah, in any building, Playa delSol and stuff like that.
Yeah, in any building, certainlywe could open it back wide open
for short -term rentals.
What would that... look like i
(08:15):
don't exactly know but if thatvacancy rate remains above three
percent which given the number ofrental housing units still under
construction and occupying likealmost every week another rental
building is occupying right nowyeah i'd say there's a pretty good
chance that it's going to be abovethree percent so we'll report back
to council it'll probably be likea january -ish report january
february and have a discussionwith council about Where do they
want to go with this?Do they want to opt out?
If so, do they want to opt outwith any special roles?
(08:37):
What's the city staffrecommendation?
And what we don't want to end upin is a situation, though, where
we allow it and then.
Two years after that, we're going
back the other way again.
You're yo -yoing with relations.
And everybody who's making, like,you guys are making, like, but
your clients, you guys are makingreal estate decisions about this.
It's like, how do you do businessin that atmosphere?
(08:57):
So there needs to be someconsistency.
over time.
And that's what we recommend to
council.
If we're going to remove some
restrictions, maybe there's a bitof a hybrid where some of those
investor properties, maybe we opensome of those up.
Like that's, I think some of thethings we'll think about and talk
to the provincial government abouttoo.
Those things that's going to dogus for a few years, for sure.
(09:20):
with relations.
And Yeah.
I mean, in terms of, I guess.
Do we want to like jump right into
kind of development and buildingstats?
Like, you know, it's prettyinteresting right now, but maybe
you have obviously the data thatwe'd love to kind of dissect.
What's going on in terms ofbuilding applications and stuff
like that in the city?How are you guys looking?
If you drive around Kelowna rightnow, you drive around Kelowna
(09:42):
right now, there's craneseverywhere, construction going on
everywhere.
And you're like, we're in a boom.
Like we don't have a problem withhousing.
And maybe right this second, wedon't have a problem with housing.
But we take a long view approachto housing.
And there's a lot of rentalhousing under construction because
we had a lot of incentives inplace between us, the provincial
government and federal government.
Yes.
To help that happen.
What you don't see a lot of is
market condos under construction.
You've got the Aqua being built.
(10:03):
You've got Movala.
Yes.
To help The ones that started along time ago.
But they started a long time ago.
Yeah, yeah.
And what we haven't seen, though,is anything new permitted that's
going into construction that'll bedone three years from now.
Yeah, yeah.
that's going into construction
that'll be done three years fromnow.
You're expecting maybe a bit of ashortfall?
Yeah.
So, Yeah.
So, I mean, we could end up in asituation where, you know, the
(10:26):
rental vacancy rate pops up to,you know, 5%, 6%, 7 % for a year
or two.
Yeah.
But the problem is with no newmarket housing.
being built, multifamily markethousing, or very little.
And like two or three years fromnow, all that extra rental stock
starts to get sucked up by peoplewho can't find housing to buy on
the market side.
And then you've got another two or
(10:47):
three year, four year constructioncycle for stuff to get.
permitted to get underconstruction.
So it could be like a volatilenext few years.
And so we're seeing all of thesebuildings occupy, but not when I
look at it.
And we've got a housing dashboard
online that's available to thepublic if you search our website.
And you can really see the storyof what's going on.
2022, 2023, lots of buildingpermits, fewer occupancies.
And then 2024, 2025, lots ofoccupancies, so far building
(11:08):
occupancies, not a lot of buildingpermits and new building permits.
Some projects like market condoprojects come back to be re
-permitted because through theplanning process, development
permits only good for two yearsunless they get a foundation in
the ground.
So there was one that we did in
February on Clement.
There's another one next Tuesday
night on Ellis Street, a big fourtower, a thousand unit Lettingham
(11:30):
McAllister proposal.
And they get another two years.
And hopefully in that two years,they can start.
Other than that, there's like,we'll see a few more of those.
There's not a lot compared to howmuch housing we need a year.
Our housing needs assessment saysbetween like 1 ,650 and 2 ,600 new
units a year.
And these years, we're certainly
not going to hit it.
And I keep telling council this in
(11:52):
years, you know, probably late2026 to 2029 is what I'm worried
about.
Interesting.
So it's funny because we need morehousing.
You can see it laying out prettywell right now.
But if the numbers don't pencil,the numbers don't pencil.
So how do we get ourselves overthat hurdle?
What do you think could happen?Yeah, and that's a challenging
thing in a time like this wherethere's all this construction
(12:16):
going on.
Yeah, and that's a challenging
thing in a time like this wherethere's all this construction
going on.
And everybody looks at that again
and says, why would we givedevelopment incentives?
And just to get something goingthat's new doesn't pencil, like
you said.
And there's probably a thousand
reasons why these things aren'tpenciling right now.
And you've got building codechanges, financing changes at the
CMHC level that have happened inlots of municipalities, like
(12:39):
constant zoning changes,development cost charges that keep
going up.
All of these things are really,
really challenging.
Maybe those would be
controversial, but what is withall the building code changes?
It just gets more and moreexpensive by the second, it seems.
If you applied for your permit sixmonths ago, you have different
building codes than you do now,and it's just...
Do they not realize that we needmore housing and it just makes it
way harder?Everybody has a different
priority, has a differentpriority, but it's the most
(13:00):
important priority.
I think governments have a problem
really like sifting through thatand saying, no, these two or three
things are the most importantthings.
And we're going to focus onsupporting these.
And those other things are notpriorities.
And so with building code, allsorts of things have become a
priority at the same time withbuilding code.
And it's just layering andlayering and layering.
We're doing like energyefficiency.
We're doing accessibility.
We're doing the structural side in
(13:21):
terms of making buildingsearthquake resilient.
And that's just the building code.
And not to mention, like, you
know, Citi adds in electricvehicle charging requirements and
then, you know, X, Y and Z abovethat.
And I'd say Kelowna is probablybetter than many others at
prioritizing.
But still, I think that.
And Governments need to starthaving a look at themselves and
saying, you know, what is thepriority here?
I said it on LinkedIn last week.
When everything's a priority,
(13:41):
nothing's a priority out there.
No, exactly.
How do you figure out what themost important things are?
And if we're in a housing crisis,where are the 18 other things a
priority as well?So I guess like as a municipality
that gives feedback to theprovince, what is kind of the one
priority that you're saying, hey,this has to happen at our level,
like for the city of Kelowna to beable to get to the state that we
(14:03):
need to?Because there are like so many
things.
working against us, right?
Like tariffs come in and it'slike, well, how do we know the
cost of the next building wheneverything might go up 25 %?
So yeah, focus our feedback tothings that are within our
control.
And like we could talk either like
development cost charges and likeprobably our biggest feedback to
(14:24):
the province is on the electricalside of things.
And that's a challenge at a bunchof different levels, like the
local infill housing level.
And there's like whole areas that
are challenges.
And then there's the overall like,
what does our city look like inthe future?
And how is power impacting that?Because there's a discussion to be
had there, too.
Yeah.
So I think I originally reachedout to you a few months ago
because we had some like prettyoutrageous headlines, basically.
(14:45):
saying, you know, a Fortisinfrastructure is not going to
fulfill the building needs fordevelopers, potentially as late as
like 2029.
Where are we at with that?
Like, it kind of seemed like itcame out.
I saw a bunch of these headlinesand then it just stopped recently.
But yeah, I guess what's the issuethere?
know, Fortis approached us about18, 20 months ago and said, hey,
look, in a couple areas of thecity, our substations are running
out of capacity.
and particularly one in the north
(15:05):
end of downtown and then one onRichter Street on Saucier.
The Saucier one was the mostimmediate, but they do long -term
capital planning.
But the problem was is that their
delivery time on equipment isthree to four years.
And so they're ordering a capitalplan, got out of sync with our
growth management side of thingsand how we are planning and like
what's going to happen when interms of development and where and
(15:26):
wasn't lining up that well.
And so we ended up with challenges
in those two particular areasfirst.
And there's a few other areas withmore minor challenges.
So we've been meeting to figureout how we deal with projects that
are going ahead in those areas.
And we created an earlier review
and warning process fordevelopers.
And then we've been also workingcase by case or developers have
with Fortis to try and change theenergy load that buildings are
(15:50):
creating to lessen it so thatpotentially they can still be
energized in those areas as well.
We're working with Fortis.
They need to actually expand ortwin the recreation substation,
which is right near Redbird.
I always relate everything to
breweries.
Yeah.
We're that age.
We're like, everyone's made it.
Yeah, we just do exactly wherethat was.
Yeah.
So in that area, we need another
substation.
Yeah.
But it lands at a premium.
(16:12):
So it's challenging to find
something in that area, trying tofigure it out.
It's not like a short -termsolution for either one of those.
But I would say we're making younothing hasn't been able to be
built yet that's sort of beenpermitted because of those
challenges.
But we may still run into that at
some point.
The thing we're also working on is
(16:32):
in a lot of our alleys in thecentral city, there's overhead, my
power pole Fortis infrastructure.
But with the amount of infill
housing happening, a lot ofpressure is being put on that.
And the locations of those polessometimes prevents housing and
infill housing or carrot houses.
And so we're going to try and work
with Fortis on what the future ofthose alleyways looks like and
that infrastructure, because wecan't have individual projects.
(16:54):
Like if you're building a fourunit building and you get hit with
like an $80 ,000 power bill,that's not sustainable in a
project.
That's never going to work.
And how can Kelowna strategicallyget involved?
to help.
We already do laneway
improvements, but maybe we need tocoordinate those better with
Fortis so that power goesunderground and new transformers
go underground.
There's ways we can deal with
(17:20):
that, so we're trying to figurethat out.
not Because that can affect aproperty.
I've been personally involved in afew of these where you have a pool
that's in a bad spot in the alley.
That property that would be a
prime development lot is all of asudden basically not saleable.
It's kind of a crazy situation.
So oftentimes, oftentimes, like if
that property does moveinfrastructure around, they front
end the cost for that.
(17:40):
But there's no recovery mechanism.
Anybody else that gets to takeadvantage of that doesn't pay into
it afterwards.
No, exactly.
That's right.
The model needs to evolve and
improve so that if other peopleare getting in a benefit, model
needs to evolve and improve sothat if other people are getting
in a benefit, everybody pays theirfair share.
And then that way the cost getsreduced for everybody too.
(18:03):
We all agree that infrastructurein a growing city needs to evolve
and be improved, but it's just howyou allocate the costs.
Also, it just wouldn't look waynicer and around.
So I think that's...
Oh yeah, Oh yeah, totally.
Yeah.
Yeah.
I mean, honestly, probably nota... bad problem to have.
Like if you're growing as a city,these are the things that you're
going to come upon.
(18:23):
I guess maybe a bit of a segue
into like DCCs.
So first of all, I guess two -part
question, like can you expand onwhat DCCs go to?
And the second part would be, areyou looking at tweaking some of
those to incorporate some ofthese?
So like one owner doesn't have theonus of that $80 ,000 bill and
then everyone else gets it.
Like, is there a way to
restructure that so it's morebeneficial?
DCCs are actually like a kind of ahigher order tool.
(18:45):
And so I'll explain that a littlebit.
There's sewer, water, road, park,storm drainage projects that are
like either whole neighborhood orsector of the city related or
whole city related.
Say we wanted to four lane Richter
Street in the future.
That's something that benefits
like a large area of the city.
So we use the DCC program.
So many new units pay a sharetowards that.
(19:06):
Plus there's an amount built intothat DCC charge for.
existing users that are benefitingfrom that as well so when that
road actually gets built maybe 50or 60 of that road the need for
that was related to new growth Andthen 40 % is paid by existing
users, which would come fromtaxation.
But maybe we also, to bring downthe cost, want to subsidize that
even a little more and we callthat an assist factor.
What we do is when we update ourcommunity plan, it's every five to
10 years, we'll do an update tothe DCC program.
(19:26):
And the DCC program, then we say,here's the major projects that are
funded by DCCs and figure out foreach project how much funding is
required.
And do we need to buy land or will
developers give us some of theland because land along that, you
know, maybe it's a corridor, we'llget redeveloped.
You figure all that out to thebest of our ability and then
review with the home builders andthe Urban Development Institute
and go through almost like line byline, haggle over the cost of it.
Sometimes to make the program moreaffordable, projects need to come
(19:49):
out of it.
It's funny that everyone says
there's no transparency to it, butI sat in 15 meetings before the
last update where we talked about,you know, meetings before the last
update where we talked about, youknow, oh, well, there's a material
cost in this road project that Ithink is unreasonable.
Why is it there?What's behind it?
(20:10):
And we have to explain that to thedevelopment community.
So from that perspective, I wouldsay there's transparency.
But if you're out there in thecommunity, you hear the term DCC
and people complaining about it.
It's a tough one to sort of wrap
your head around.
That's a really like simple DCC.
The whole development industry isbasically paying towards specific
global community projects.
(20:30):
Good example of that would be the
Hart Park that opened lastweekend.
A portion of that was built usingdevelopment cost charge park
construction money.
And we would be able to say, if
you said, oh, well, how much?development money went into that,
our team could say, oh, well, theamount of new units that were
happening in this neighborhood, wecharged them this amount or this
amount was contributed to that andtaxation, which was like the
(20:53):
existing area residents whobenefit paid X amount towards it
as well.
So it'd be great if there was
actually like a really transparentway to see that.
And that's one of the problems.
Like there's a lot of smart
accountants and engineers who workon it behind the scenes.
If we did like a video every yearthat explained like, here's where
your DCCs went this year, there'dprobably be better buy -in from
(21:15):
the development community too.
Yeah, I mean, I don't think anyone
can really dispute that it's notbeing spent in good.
projects like i mean i was just atthe heart park a couple days ago
with the kids it's amazing youknow so i think when we had you on
last show you know you saidsomething along the lines of we're
kind of shooting yourself in thefoot in terms of it's becoming a
very expensive city but it'sbecause we're reinvesting in these
(21:37):
amazing amenities and that's justlike a perfect example of it you
allocate those dcc fees where youwant and you're never going to
make everyone happy not just makepeople happy but but Keeping
people informed, like are peoplereally going to want to watch the
accountant bringing down thenumbers or even a video of that?
I mean, I mean, I think when youshow where it's going and how
much, who's paying for what,that's kind of interesting.
(21:58):
how But yeah, like the line byline stuff, yeah, is a little bit
boring.
And it's actually an interesting
time though with DCCs.
I find it interesting, but I'm a
nerd, so maybe not so much.
So in the new liberal government's
housing platform, and I'm assumingthat they're going to be acting on
this.
They had a commitment to cut DCCs
in half.
Does that have anything to do with
them?How do they do that?
(22:19):
We're going to see, going to see,I guess.
What's your opinion on that?Are they just going to pay the
other half?They said that for the half that
we're not collecting, they willreimburse with a formula.
But I think that that formulameans that we only recover about
half of what we're giving up.
So we're still missing about 25 %
of that.
So that certainly impacts the
community.
Hopefully there's some room there
as the implementation happens onthat to figure this out.
(22:40):
I mean, I think, again, if housingis the priority and that's one of
the tools that we have to helpease the crunch for developers and
home builders, that's fine.
But we hear from the community
constantly here in Kelowna thatyou're not building enough
infrastructure fast enough.
And so then if we're not funding
it properly, that makes it eventruer than it is today.
And I mean, I think where we getbehind is times like COVID where,
you know.
Prices went through the roof.
(23:01):
Things were so unpredictable thatwe were really unproductive in our
infrastructure delivery programsfor a few years while we were
still building housing.
But we couldn't predict, you know,
some of those costs were insaneor, you know, we just weren't sure
whether or not we could create aproject.
And we've wrapped that up againthis year, next year, the year
after, and you see way moreinfrastructure built.
And driving around right now, youcan already see that in the
community.
So hopefully, we hopefully, yeah,
(23:21):
we're made as whole as possible onthat so that the community and the
infrastructure side of things thatpeople.
think less about doesn't suffer.
What excites you about the new
liberal government policies forhousing at our municipal level or
provincial level?Yeah.
Are there any policies that havecome out that you're like, I
actually think they're going toreally hit this one out of the
(23:41):
park and follow through with it.
And like, we're excited to
implement it as a city.
It'll be interesting to see.
They talked about like Canadabuilds program or build Canada
program.
Like the modular housing thing.
Well, actually, yeah, there's twothings.
If the federal government getsinvolved.
In housing, I don't think theyshould do it to compete with
developers in any way, shape orform.
I think the development industrycan serve the top two thirds of
the people of Canada quite well.
(24:03):
But where I think it's failing is
the very affordable housing outthere and like shelters and
helping those out that have likemental health and addiction
issues, like housing and treatmentfor that.
So if Canada is going to getinvolved federally, that's the
spot for it.
So I'd be excited to see them and
very involved.
And it seemed like that's what the
campaign platform said.
(24:24):
And then the other part of it is,
yeah, the modular prefabricatedside of things and seeing the
federal government help the SRIsof our region could produce for
years on end at full capacity,knowing that, for instance, the
government might buy off theirexcess supply.
Then they could borrow forimprovements and technology
upgrades and expansions and nothave to worry about market cycles
because that's what kills thoseplants now.
You know, they ramp up and thenthey have to lay everybody off and
(24:46):
then they ramp up again and itjust kills production.
So if they can produce at a higherlevel long term in the region and
the ones that get bought off bythe government become affordable
housing supply, I think everybodywins.
Places like that are where thegovernment should be involved, the
de -risking and not in competitionwith development.
not competition with development.
I like that.
That's a good point.
I feel like the modular housing
and the infill that we're going tobe having in Kelowna, like it's
(25:08):
like a match made in heaven.
It just feels like the two are
just made for each other.
Because the modular houses are
super nice places, right?They're not like mobile home
parks.
They're like real houses.
And they're very nice.
Nothing wrong with mobile homes
either, man.
Nothing wrong with mobile homes.
But like I'm just saying downtownis not going to turn into a mobile
home park.
Like they're very nice places.
Well, in the assembly, I was like,once you've built a foundation and
(25:30):
like with the plumbing, you coulddrop like four units onto that.
in a day yeah exactly yes you knowbe ready to like putting on the
outside finishing and like thoseare quick projects if the
inventory is available yeah andlike from a technology perspective
one of the other things that getsme excited is i mean maybe you're
selling a property buyer's agentcomes and says like well what can
(25:51):
we do with this and you can saywell check out the city's website
it'll walk you through what youcan put there yeah then you can
figure out okay well that'seligible for four and it will
suggest yes know be ready to likeputting on the outside finishing
and like those are quick projectsif the inventory is available yeah
and like from a technologyperspective one of the other
things that gets me excited is imean maybe you're selling a
(26:15):
property buyer's agent comes andsays like well what can we do with
this and you can say well checkout the city's website it'll walk
you through what you can put thereyeah then you can figure out okay
well that's eligible for four andit will suggest prefab designs
from a bunch of different prefabbuilders or designs that are maybe
non -prefab too, that will fit onthat property and then say, okay,
(26:37):
well, if you want it to go prefab,here's the time it would take to
fulfill your order.
Or if you wanted to use a regular
builder, here's three buildersthat are ready to go in the next
six months and could start.
And that might involve some
collaboration with the Canadianhome builders locally.
And they've got like a great, well-organized chapter here.
And, you know, if they could drivebusiness and juggle clients based
on that.
I mean, it's funny, I sort of
supervise the construction of thegrowth of the community.
(26:57):
But if I had to go build my ownplace and I didn't have some of
the context that I have right now.
Where do you start?
Who do you use?How long is it going to take?
Like most people have no idea ifyou're not in the industry.
I have right now.
Where do you start?
Who do you use?Even meeting someone like Taylor
to finance it, like talk toTaylor, just all these different
options.
I agree.
Go to one place and you just haveall these options.
(27:20):
It would just like streamline theprocess.
What banks do this?What banks do this?
And what are the advantages anddisadvantages to each?
Like there's no reason that wecouldn't be the hub of that
information.
Out of, you know, a simple sort of
software process that walks youthrough step by step by step.
And we've sort of started that.
We have a chat bot for our infill
housing that helps.
But I think we'll see that
(27:41):
hopefully grow over the next fewyears.
And I've got a manager in ourhousing area who's really
passionate with that.
And I think he'll be able to pull
it off.
Nice.
I was going to ask about the chatbot.
Do you guys have like top 10questions or what are people
mostly asking that they don'tknow?
I was just so curious what theconversations are.
That's maybe another video.
maybe another video.
Let me go back and get the data.
Like I deal mostly in the data
logs, like how many people areusing it?
When are they using it?And so we have like 100 to 200
people a month using our variouschatbots in our area.
And mostly during business hours,smaller percentage evenings and
weekends type thing.
When we actually talk about them
in the media, then the use goes uptoo.
our It's about to skyrocket.
Yeah, if you post this, it will
get more likes even from that.
Or I was talking about our
(28:02):
chatbots in Calgary on Monday onthis technology panel that I was
on.
Somehow my 10 -year -old tells me
like I'm terrible at Minecraft.
He's been trying to teach me how
to acquire them.
And he thinks it's hilarious that
I'm so bad at video games, but yetI'm presenting at conferences.
I'm talking about artificialintelligence.
That's awesome.
I'm not the guy who could tell you
exactly.
like how the software works or
(28:23):
anything else, just our experiencelike using it so far.
And one of the things actuallythat we're finding is that the
chatbots, once you get them goingand they're answering questions
for people, they're meant toanswer like, you know, in our
building process where we launchedthem first, we get tons of
questions about like swimming poolconstruction, for example, and how
high fences need to be aroundswimming pools, what are the
setbacks from property lines orthe house and all those types of
things.
That's what gets asked pretty
frequently.
But if you don't maintain the
chatbot, it actually starts to getdumber and answer questions.
(28:43):
Oh, really?I'm not even lying.
I had a conversation about ityesterday with one of our tech
guys.
And he said, yeah, that's one of
the challenges that we're having.
I don't know if it's because the
chatbots aren't getting likepositive reinforcement or what.
I don't know enough about it.
it. So we all have to do our part
and go ask questions to make ussmarter.
I actually think it's because thechatbots are pointed at like
(29:04):
specific bylaws and areas forinformation.
And so if we're changing in thoseareas, how that information is
worded or presented, then it'spulling things out.
It'll misinterpret.
And when it's putting them into
its own words, I think that'smaybe what's going on.
But yeah, again, as a guy who'slike not the expert, I'm just a
liberal arts planner.
I'm not an IT guy.
That was pretty funny.
I feel like I can relate to the
(29:24):
chatbot.
If I don't get positive
reinforcement, I'm just...
You just start lying.
You don't need a fence there.
That's fine.
Well, I think there's some dangerin that because we're actually
giving people advice.
We start getting terrible building
permit submissions for certainthings where they're all
consistently wrong in the sameway.
Our chatbot's called Kai, so it'sprobably Kai's fault.
But again, it's like a naturalgrowing pain that we have to
(29:44):
evolve that way, right?Like to speed things up and make
it more efficient.
Yeah, I think if we weren't...
trying to use new technology,there'd be a signal to our
community saying, what's our localgovernment doing?
They're not trying to be moreefficient.
They're not trying to provideservice to us in a more convenient
way.
And we'd be getting criticism over
that.
And we're actually a great size to
be testing those things because ifwe're putting wrong information
(30:05):
out there, it's not like we're ina city the size of Surrey.
We're like, you know, six or 700,000 people are getting terrible
information.
We're a little bit smaller than
one.
So, you know, maybe we see it show
up.
with a couple of people in the
next two months.
And I say this consistently, staff
(30:26):
can also give the wronginformation too by accident.
And so, I mean, it's not the firsttime it's happened and won't be
the last.
Yeah.
Yeah.
Well, and by implementing some of
this stuff too, like you guys aregetting grants at a provincial and
federal level too, right?Oh yeah.
You know, you're gettingrecognized as like an innovative
city.
So therefore there's benefits to
it.
Oh yeah.
Big time.
Big time.
Yeah.
Yeah, I get invited to tech panels
(30:48):
that I have no business for.
That's awesome.
Maybe one question.
I'm just curious about single
family houses, building permits onthat level.
You know, we kind of spokeobviously about condos and maybe
some purpose built rentals.
Are we seeing much activity on any
kind of building permits forsingle family homes?
Or is that just kind of sitting bythe wayside now?
(31:08):
Yeah, it's pretty consistent.
We see between like.
200 and 350 a year in Kelowna.
There's actually no such thing as
single family zoning anywhere inKelowna.
Right.
That kind of ended last year when
the province changed all itslegislation.
That kind of ended last year whenthe province changed all its
legislation.
Yeah.
But we still see people buildingsingle family homes, obviously.
And about 70 % of the singlefamily homes that get built have
(31:31):
secondary suites in them now.
That is awesome.
Kind of an interesting stat.
But you could do single family
house, secondary suite, carriagehouse, depending on your lot if
you wanted to now and do itlegally.
Or you could do... fourplex or twotwos.
So we're starting to see thattrickle out into some of the
(31:52):
suburban neighborhoods now.
It used to just be a center of the
city thing in Kelowna.
And now, you know, in the lower
mission, you're seeing a few.
And there's great concern over
this in the lower mission.
And I don't know if people weren't
paying attention to the news lastyear, but this is something that's
provincial.
I was going to ask you, have you
(32:12):
seen like any specificflashpoints?
Yeah, I mean, yes.
The first few applications that
we've approved for three or fourunit buildings sort of in that
lower mission area, we're hearinglike great concern over that.
And we did water down.
The provinces, like their zoning
regulations that they asked us toimplement quite a bit from what
got implemented in the center ofthe city to sort of the suburban
Kelowna, like Glenmore, parts ofRutland, and the Mission all got a
(32:34):
lighter touch.
And we complied with the
provincial legislations.
And I'm saying this publicly.
It's not like we circumventedtheir rules in any way.
But it was just sort of a lightertouch.
a bit But When this stuff happens,it's complicated.
It's not put in language that theaverage person living on Sarsen's
Road understands.
We did actually quite a bit of
advertising last year about ourinfill programs and what was
happening.
We had bus stop advertising.
(32:54):
But thinking back, I don't know ifI pay attention to any bus stop
advertising.
Especially not the kind of people
that are going to be bitchingabout a fourplex next door.
Yeah, Yeah, exactly.
We've been advertising at the BMW
dealership.
That's actually a good idea.
I'm going to do that next time.
Yeah, I actually have a couple of
lots for sale on McClure and likeall the interest we've got is four
(33:16):
plexes.
And I'm just like, hey, this is
interesting.
And some of those lots are like
the parking is really sort of thelimiting factor.
some of those lots are like theparking is really sort of the
limiting factor.
Can you get the parking on and
comply with our bylaws?And we're actually been pretty
strict on that because in thoseareas, lots of people have, you
(33:38):
know, the two and three cars.
And so trying to make sure that
they get the minimum number ofparking stalls and being
inflexible on that front.
Yep.
to Nice.
We'll see more friction in that
area as more of the city starts tosee different housing types end up
in their neighborhood.
And I think we had our biggest
year last year for infill housingfor like the four to six unit
level.
see more friction in that area as
more of the city starts to seedifferent housing types end up in
(34:01):
their neighborhood.
And I think we had our biggest
year last year for infill housingfor like the four to six unit
level.
And we did 45 permits for those.
And I think success in my mindwould be if five years from now we
were doing a couple hundred ayear.
Really?Yeah.
If we were doing a couple hundreda year and of those couple
hundred, if 30 or 40 were modular.
I think that that would be a
(34:22):
really good news story.
That would be awesome.
would be awesome.
How do we get to that level?
That whole combination ofavailability for modular housing,
whole combination of availabilityfor modular housing, partnerships
with Fortis, trying to make thingseasy on that front.
continuing to make sure ourprocess here remains streamlined.
And then maybe, Taylor, you cansay better than I can.
But like borrowing for those fourunit buildings is a little bit
(34:46):
different, I think, isn't it, thanborrowing for like a house and a
suite?It is.
Yeah, they are coming out withsome great programs that they
have.
But still, even at the government
level, like CMHC, a lot of lendershaven't allowed those policies
yet.
They're like, yeah, we have the
information from CMHC, but wedon't really know how to implement
it in our own underwritingguidelines.
So there's like a lag there.
You know, it's coming.
(35:06):
It's coming.
have the Yeah.
So that's I think that like lotsof things will come together in
the next few years.
There's financing, there's
development process, there's theconstruction, the power aspect of
this and making sure that's right.
And I think it will come.
I think we're doing the rightthings in Kelowna.
The pre -approved designs, too,that we have.
(35:26):
We're expanding that catalog ofpre -approved designs.
Well, there are some federal.
pre -approved designs, will adopt.
And hopefully if builders canbuild the same versions of the
same thing over and over too, thatwill help speed up the approval
process for infill housing.
Yeah, well, we had a great episode
a few months back.
It was a two -part one.
We brought you guys on withSandbox as well to go over some of
(35:47):
their designs.
And I went to that infill housing
day as well.
It was awesome.
So yeah, you guys are doing goodthings.
We appreciate it.
Yeah, some of one of the other
bits that we might look at doingis some speed funding to get
infill going.
There's lots of property owners
who are like, like land rich andcash poor.
A lot.
I've talked about that a lot.
Yeah, but maybe they have two kidsthat are just finishing up at
University of Calgary or NAIT ordown like at UBC and want to come
back.
The house isn't right.
(36:08):
They've got a small mangala.
How do they do it?
They want to build something fortheir kids and then they sell a
couple of units on the property orsomething like that.
Like how do they afford to dothat?
And how do they pay for thedrawings, the DCCs to get it
rolling?And so we've been talking with a
couple of different small housing,BC, middle from Alberta about, you
know, how we make that work.
And so, you know, if we got some
extra money from the federalgovernment for our housing
accelerator projects, we may rolla project like to help more infill
get going.
So you'd essentially like partner
with the existing homeowner.
We would loan money to get things
(36:29):
going and then they would pay usback on the end with a little bit
of interest.
We would loan money to get things
going and then they would pay usback on the end with a little bit
of interest.
Like we're essentially acting like
a small bank anyway.
And then we would roll that into
another project and hopefully webuild up our capital to invest
over time.
And, you know, we start with, you
know, two or three projects ayear.
(36:51):
And then, you know, 15 years fromnow, we're doing 30 or 40.
That would be awesome becauseyou're right.
That is a major need.
Yeah.
And it's not being fulfilled.
Like the banks aren't quite there
yet.
And yeah, I mean, I think there's
lots or maybe for whatever reason,like they just don't fit the risk
profile.
But we think they're low risk and
who they partner with, thatthey're partnering with
established groups who are, youknow, can help them project manage
(37:12):
it the whole way through.
And we trust them.
Then, yeah, I think.
Yeah, that would be a huge factor,
But that would be a huge factor,too.
But yes.
on the right track?
It's going to be a reallyinteresting next, I would say,
year to see what the federalgovernment does first.
I think they need to move prettyquickly on the housing front.
And so if the GST exemptions forfirst -time home buyers will
probably happen quickly, do theyallow foreign buyers to buy new
(37:35):
housing?That could happen quite quickly.
The DCCs may or may not be morecomplicated.
I'm thinking of...
Everything we'd need to change
here when we're changing our DCCbylaw, I don't know what tools
they have to like order us to doit and how that works out.
I know that the provincialgovernment is also considering
changing the time when DCCs getpaid with a construction project.
That would be awesome.
Yeah.
From when we issue building permitto when occupancy permit is.
(37:56):
Yeah.
And that would be a big deal for a
lot of people.
Like just those three things
coming together, I think start tochange the way that developers are
looking at the housing market.
But there's probably some more
fundamental change andprioritization that needs to
happen in this country over thenext five years if we want to be
like consistently deliveringhousing.
Back to the priority sort ofdiscussion.
We keep seeing provincial andfederal government get more
(38:17):
involved in municipalitiesbusiness, but it's for good reason
because like the priorities areall over the place.
I think a component to that ismeasurement too.
The province is already measuringhow much housing we're producing.
CMHC is already measuring us in abit of a different way.
But, you know, across.
Canada, hopefully we'll see the
federal government say, OK, thatthe communities that streamline
their processes the best to acceptand permit housing and are working
well with industry to do that.
(38:38):
We'll get their fair share of
infrastructure dollars and grants,because that's what we've not been
seeing is sort of our fair shareon that front here.
We've been good performers, goodpartners with government, and we'd
love to continue to be that.
It's like the infrastructure help
is a really big, big piece to thepuzzle.
Love it.
Awesome.
Well, thank you so much for comingon.
I mean, yeah, we love havinganyone from the city come on, but
(39:00):
you're awesome, man.
So yeah, I appreciate it.
Yeah, appreciate it, guys.
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