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Breaking:: Housing Developers Admit Inability to Match N.S. Population Growth Without Major Reforms


This story is part of an ongoing CBC Nova Scotia series examining how the province is managing its unprecedented population boom after decades of limited growth.

As the Nova Scotia government works to double the province’s population to two million by 2060, many have one question on their minds: where will people live?

Professionals in the construction and development industries say Nova Scotia is not building enough housing fast enough to meet current demand. They say conditions will have to change dramatically for the province to adapt to continued population growth.

“That has to change,” said Duncan Williams, president and CEO of the Nova Scotia Construction Association. “We’ve set very aggressive immigration targets, which is wonderful, but we also need places for them to live.”

After decades of stagnant or declining population, Nova Scotia’s population has increased in recent years.

Driven largely by international immigration and people moving from other provinces, Nova Scotia has added nearly 111,000 new residents since 2015, more than 10 per cent of the current population, which as of April 1, 2023 was 1,047. 232.

But this population increase has coincided with what provincial officials call a housing crisis. Vacancy rates are low, average rents are rising, and homelessness is doubling in urban centers.

Over the past five years, housing starts in Nova Scotia peaked in 2021 at 5,310 units that year, then declined to 4,877 units last year, according to data from the Canada Mortgage and Housing Corporation.

This number represents new construction of single-family homes, townhouses, townhomes, and apartments. Williams believes this number should be tripled.

“If we are going to see a doubling of the population, based on the current makeup of households, we would need to have between 15,000 and 16,000 units per year across the province,” he said. “So it would be a stark contrast to the situation we find ourselves in today.”

Premier ’embraces the challenges of growth’

Growth over the past year has been the fastest on record since 1951. And Nova Scotia’s premier believes the province can keep it up.

“We need more people. Our demographics are not very good. So doubling the population, to me, means right-sizing our demographics. It’s about making the province younger,” Premier Tim Houston told Breaking: in an interview in July.

The province estimates that more than a quarter of Nova Scotians They will be 65 years old or older in 2030.

The provincial government has said continued growth will lead to more tax revenue, new businesses and jobs, better infrastructure and greater diversity.

Premier Houston’s campaign focused on fixing health care in the province, but housing has also become a pressing issue. (Jeorge Sadi/CBC)

But challenges include an overburdened health care system, schools overwhelmed and turning to portables and modulars, and more Nova Scotians struggling to afford to buy or rent a home.

Houston said he “embraces the challenges of growth,” believing they can be overcome.

Both Houston and Housing Minister John Lohr have said the solution to the housing crisis lies in the hands of private and nonprofit developers.

There are currently no plans to build more government-owned public housing. Instead, the province is focusing on investing in programs like the Community Housing Acquisition Program and the Home Land Initiative to add affordable housing to the market.

Houston said another way to combat the housing shortage is to train and attract more tradespeople.

Barriers to development

In a report published last weekTo address the affordability gap, Nova Scotia needs 70,000 more new housing units by 2030, in addition to those already in the pipeline, the Canada Housing Mortgage Corporation concluded.

But the developers say it’s not that easy. The biggest barriers to achieving this are labor shortages, higher interest rates and the rising cost of construction.

“In recent years we have started and completed more housing units in Halifax than ever before,” said Michael Kabalen, executive director of the Affordable Housing Association of Nova Scotia, a non-profit developer. “However, it is still not enough and in fact we are starting to see a decline in the number of new starts and new units.”

Kabalen said nonprofit developers face challenges such as long approval processes and raising enough money to meet government funding requirements.

“When the nonprofit is actually ready to submit and withdraw its loan from a government program… we often wait seven, eight, nine months just to hear back.”

A man stands in front of a row of houses under construction.
Michael Kabalen said the government is looking for private and nonprofit developers to solve the housing crisis. (Daniel Jardine/CBC)

Private developers face similar challenges. Peter Polley, owner of Polycorp Group, said bureaucracy and taxes are some of the biggest problems in his business.

He said he is studying a plan to build high-density housing near Halifax, with some affordable units, because he can’t get approval.

“This is not rocket science. We’re not going to put a man on the moon… We’re building houses,” Polley said. “It shouldn’t be so complicated.”

Last week, the federal government said it would remove Goods and Services Tax (GST) from the construction of new rental apartments to stimulate new developments.

Federal Housing Minister Sean Fraser wrote to Nova Scotia Premier Tim Houston on Thursday to urge him to eliminate the provincial portion of the Harmonized Sales Tax (HST) from rental housing construction. The Nova Scotia government has not yet responded.

Although developers have asked for tax incentives like this, they are still waiting for more solutions. Kabalen said it will take all levels of government, as well as private and nonprofit developers, to work together to combat the crisis.

“We didn’t do anything for a long time and I think we have to get over that,” Kabalen said. “So the first thing we need to do differently is stop trying to assign blame and start… claiming what our part of the solution will be.”

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