Construction workers build another single-family home on Cory Drive in Terrace. (Contributed photo)

City advocates for smaller residential lot sizes

Higher density developments can promote more efficient land use, city says

Affordable homes in Terrace are getting more difficult to find as land and development costs continue to rise.

To support higher residential density, the city is encouraging developers to build homes on smaller lots to make better use of the land, lessen pressure on taxpayers, put more money back into the developers’ pockets and create more affordable housing options.

“Affordability is definitely a factor, the other balance to it from a municipal standpoint is it’s more efficient, more sustainable land use,” says David Block, city planner.

The push isn’t necessarily for smaller houses, but to build on smaller lots.

Though the minimum 15-metre width for single-residential developments has been set in the city’s zoning bylaws for the last 30 years, the average lot size in Terrace is between 18 to 20 metres, Block says.

The thought process of building residential homes on sprawling, larger properties was more attractive when land and development costs were low.

READ MORE: Terrace zoning bylaws enter 21st century

In 2008, new residential lots cost buyers $50,000, compared to $100,000 in Prince George. Ten years later, that cost has now more than doubled in Terrace to the $140,000 to $160,000 price range.

“Residential single-family lot prices are comparable to Prince George right now,” Block says, noting costs may be inflated because of the lack of residential lots currently on the market.

“If you’re doing the same 30-lot subdivision on the same amount of infrastructure that you did 10 years ago in Terrace, there’s no way you’re making the same amount of money.”

As demands increased, developers subdivided their larger lots and the city outlined plans for higher density developments in the city’s official community plan, phasing out their RR1 rural residential category to prevent sprawl.

The city says it’s now encouraging developers to stick with the minimum width requirements for lots to maximize the number of houses possible, but some development projects still prioritize yard space over density.

Driving down Cory Dr., there is a noticeable amount of space in between the new houses built on the bench used to create side yards that usually aren’t regularly used by the homeowners, Block says. Those lots could have been smaller, increasing the number of houses on the stretch of road and creating a larger tax base.

READ MORE: Residential projects delayed for years in Terrace pick back up

“You can put 40 lots on that block and still meet the minimum frontage rather than 30 lots on that block, and you will make more money because you’ll sell those lots, not for $150,000 [for 30 lots], but $135,000 for 40 lots,” he explained.

Block points to another example of this push for density when Wirtl Construction proposed for a 30-unit low-density subdivision to the east of Cory Dr. on McConnell. After some calculations, Block says owner Emil Wirtl was required to increase the number of units to 34, though there was room for more.

“He could meet our bylaw minimums and have 46 lots on that street,” he says.

Block says it makes more sense to build as many homes as possible on a piece of property, not only to sell more homes, but to create a larger tax base for future infrastructure upgrades.

“It’s around affordability of developing and passing that cost onto the buyer with the land value of that new lot, but it’s also affordability from a taxation side so we don’t have to raise the mill rates and charge residential tax rates incrementally as much if we get more efficient land use, more lots on the same amount of infrastructure, and the cost per taxpayer comes down,” he says.

Rick McDaniel, real estate agent with Re/Max, says there is a need for every type of housing in Terrace right now. He says he agrees with the city that creating more lots could help with immediate demand.

“I think it’s a good idea to make smaller lot sizes available in some areas for higher density, particularly if you’re talking about the five or 10 acres of land on the Bench,” he says.

“The volume of new housing that’s going to be required over the next five to seven years is going to be difficult to keep up with, and basically we need all the cards on the table.”

Though McDaniel is cautious about the city’s push for density, and believes letting the market dictate demand usually results in a balanced mix of housing options anyway, he warns that subdividing too much can actually raise lot prices as the need for land grows.

“The smaller a land parcel becomes, the more valuable it becomes,” McDaniel says. “You take something with 10 acres, it might be worth a couple dollars a square foot. You take something a tenth of an acre it might be worth $25 a square foot depending on the location. So, there’s a sliding scale of values.”

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