Austin Thompson and Tegan Hill are analysts at the Fraser Institute.House prices have fallen modestly in British Columbia. But today’s prices still pose a monumental affordability challenge for many families. And a recent slowdown in homebuilding threatens to keep prices high for longer. First, it’s important to put recent declines in house prices in context. Across BC, the price of a typical home (single-detached, townhome, or apartment; new or resale) reached a high of $1.0 million in 2022. By 2025, that had fallen to $927,600 — a 9.1% decrease.Any price relief is a benefit for first-time homebuyers and renters, but today’s house prices are still hardly affordable. Typical home prices in 2025 were still 35.7% higher than they were in 2019, when many were already struggling to afford a home.If incomes in BC had grown faster in recent years, today’s high house prices would be more manageable. Unfortunately, many have fallen behind, reflecting the province’s weak economic performance. At the same time, the fall in housing prices means that some housing projects aren’t financially feasible in today’s cooling market. In fact, homebuilding in BC fell by 4.7% in 2025 relative to 2024, even as it accelerated by 16.2% in the Prairie provinces and 20.4% in Atlantic Canada.But BC's homebuilding slump was not inevitable. More homes would be built today — and at more affordable prices — if government policies didn't restrict new housing and add unnecessary costs and delays. .Some housing opportunities across the province are denied outright by land-use policies that preserve agricultural land. Still more are destroyed by zoning rules that make single-detached homes and duplexes the default housing style in large areas of the Lower Mainland. Even in areas where higher-density housing is permitted, many BC municipalities impose onerous restrictions. For example, the province has empowered municipalities to restrict the number of homes that can be built in new multi-unit housing projects unless the builder agrees to provide “affordable” units and public amenities. This misguided policy locks higher-density housing behind lengthy case-by-case negotiations with municipal planners — and it imposes a major financial burden onto new homes, raising costs and discouraging construction. This heavy-handed approach to urban planning helps explain why builders must wait 7.7 months in Vancouver and 15.9 months in Burnaby to find out if their housing projects will receive municipal approvals — compared to only 3.4 months in Edmonton and 3.1 months in Regina. In addition, steep municipal charges on new homes increase costs and prevent some homebuilding projects from breaking even. These charges amount to $122,200 per high-rise unit in Vancouver, $59,600 in Burnaby, and $58,100 in Surrey, compared with $8,000 in Halifax and $6,900 in Edmonton. These policies are a persistent drag on homebuilding. In a cooling market, they leave builders fewer ways to respond — whether by shifting to different housing types or building in different places — deepening the construction slowdown and slowing affordability gains. Despite a recent price decline, BC housing remains unaffordable. To build more homes and improve affordability, the provincial and municipal governments should ease zoning restrictions, simplify approval processes, and reduce charges for new homes. Austin Thompson and Tegan Hill are analysts at the Fraser Institute.
