Township of Langley DCCs Double

At the Township of Langley (TOL)’s June 10th regular Council meeting, Council gave first, second and third reading to a new Development Cost Charge (DCC) bylaw, replacing the 2012 DCC bylaw.

This conditional approval will see DCCs for residential development increasing between 86% and 90% (depending on land use category).

The table below shows a comparison between the 2012 DCC rates and the new rates as well as provides an illustration of the magnitude of these changes in real dollars, per acre of additional cost. For example, a typical townhouse development in Willoughby achieves a density of approximately 22 units per gross acre of land. At this density, the new DCCs will translate to an additional cost of $348,370 per acre. For land with potential for apartments, the 2019 DCC rate is nearly $800,000 per acre more than the 2012 rate.

How will these new rates be implemented?

The report to council suggests the new DCC rates will go into effect immediately, upon final adoption of the new bylaw. There are, however, exceptions for in-stream applications:

  • Building permits and subdivision applications submitted in advance of final adoption of the new DCC bylaw will be exempt.
  • Rezoning and development permit applications will also be given protection from the new rates if the application was received prior to adoption of the DCC bylaw and is able to receive building permits within 12 months of adoption of the DCC bylaw.

With current application lead times where they are, if an application is not already in process with the Township it is almost guaranteed to be subject to the new rates.

What does this mean for land values in the Township of Langley?

Land values are a function of how much the new homes would sell for, less all development and construction costs. When costs rise and all else remains equal, builders have to pay less for the land to ensure a financially viable project. These DCC rate increases are significant and rumours of their arrival had already been putting downward pressure on land prices.

Let’s assume a builder is looking to purchase a hypothetical 2 acre townhouse development site that permits up to 22 units per acre (a common land use designation in Willoughby). If that builder was able to pay $6,500,000 for that site ($3,250,000 per acre) prior to the new DCCs, the builder can now only afford to pay $5,800,000 ($3,250,000 – $350,000 per acre increase in DCCs = $2,900,000 per acre).

Alternatively, let’s assume that a builder just purchased that same site at $6,500,000 last month and is now subject to the new DCCs, an additional cost of $700,000. With the land price now fixed, that cost must come out of the project’s profit. This is certain to create some trouble for recent purchasers of development land who had not anticipated the increased DCC rates or built them into their financial projections for the project.


Click here to download the full staff report to council, which includes the full list of new DCC rates and the associated background study.

Justin Mitchell

Personal Real Estate Corporation

Founding Partner
Residential Development Land
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