Land density plan put on hold by Dean Unger - Story: 43064
Nov 12, 2008 / 10:43 am

"Initial optimism about a plan that would allow developers to make cash-in-lieu donations at par to the city in exchange for increased density allowances, has been put on hold by Kelowna Council.

Developers would make cash donations to the city in exchange for higher land density allowances. The money would then go into a fund that would support affordable housing."

Full Castanet.net Story

The basic idea of this type of "pay to go higher" program sounds good but is certainly not without flaws.  One of the concerns is the affordability aspect of these higher density homes.  If a developer offers "x" number of units at a reduced purchase price then it is very likely those upfront losses will be offset by raising the prices on the remaining units.  The question to be asked then is: "What benefit is there to the buying public?"  The City of Kelowna has also discussed that some of these additional DCC's (Development Cost Charges) would be put to creating larger and more elaborate parks and green spaces downtown.  In my opinion a far better and more attractive use of these extra funds collected from contributing developers.  Seems to me that council might have gotten a little too excited about this pilot project before working out all the details and fine tuning how the funds might have a positive impact for the buyers!

Sincerely,

Jason Neumann

Kelowna Real Estate Blog