The Problem is no longer Zoning
British Columbia has done the hard political work. On most urban lots on southern Vancouver Island you can now build three, four or six homes where one stood, with no rezoning, no council decision and no public hearing. For a small developer, that is an extraordinary change.
It has not made housing affordable.
A new four-unit building in Saanich costs roughly $3,500,000 to deliver. Divided four ways, each home has to sell near nine hundred thousand dollars for the project to close. Median household income in the Capital Regional District is about $84,000 dollars. No arithmetic reconciles those two numbers.
So the province removed the zoning barrier and revealed a second barrier behind the first. The homes produced by small-scale infill are new, modest and entry-level — and they are still out of reach of the households they were meant for.
The Financing Gap Behind the Zoning Barrier
There is a third barrier, less visible than the first two, and we have spent three years running into it.
Federal housing finance in Canada supports rental housing quite well and owner-occupied housing hardly at all at this scale. The two major instruments — mortgage loan insurance under MLI Select, and the Apartment Construction Loan Program — both require a minimum of five units, and both additionally require that the building be rented rather than sold. A four-unit strata building for owner-occupants qualifies for neither. CMHC’s homeowner refinance product reaches four units but caps the completed property value at two million dollars, below the value of any four-unit building in an urban BC market.
The practical consequence: a developer building a minimum of five rental units (and likely more) needs to raise only 5% equity. Anyone developing missing middle in-fill, needs to raise 25-30% at commercial rates to build four units for people who will own them.
In September 2026, we put that case to Housing, Infrastructure and Communities Canada as part of its consultation on federal housing finance, along with three questions we cannot answer from outside.
What We are Working on
Subsidy solves this one household at a time and has to be paid again for the next one. We are interested in a structure that solves it once and keeps it solved …. for the next buyer, …. and the buyer after them …. and so on.
The idea is straightforward. A household buys a home and holds registered title to it, in fee simple, as any owner would. A covenant on that title caps the price at which the home may be resold — the previous price, indexed to inflation, and no more. The difference between that capped price and what the home would fetch on the open market is held as a separate interest by a patient investor, who accepts a below-market return in exchange for that appreciation over a long horizon.
The household owns their home. They can sell whenever they like, and they take out the real value of what they put in, protected against inflation. What they do not take out is the speculative gain — because that gain is what keeps the home affordable to the family that buys it next.
This is not an untested idea in principle. The Whistler Housing Authority has run approximately one thousand ownership homes on resale covenants indexed to the Core Consumer Price Index for years. What has not been done is applying that mechanism to ordinary market housing, outside a resort municipality’s employee programme, funded privately rather than publicly.
Why it might work where subsidy does not
The development closes at full market value with a conventional developer margin. Affordability is not funded by a discount to the builder, by donated land, or by a grant — it is funded by an investor accepting patience instead of appreciation.
That is the whole point. A model that depends on someone working at a loss runs once. A model that pays everyone properly can run again.
Who we would like to hear from
Landowners — congregations, societies, institutions — who hold land, want to see housing on it, and do not want to sell it or take on development risk.
Non-profit housing providers and municipalities with experience of resale covenants, land leases, or shared-equity ownership. We would rather learn from what you have already solved than solve it again badly.
Lenders and researchers with a view on any of the unresolved questions above.
Nothing on this page is an offer to sell a security or an invitation to invest.