House cost increasing

By MARK MACDONALDStaff reporter Jun 01 2007 http://www.kamloopsthisweek.com/

Building a new home in Kamloops got a little more expensive this week
City councillors voted unanimously to increase a tax levied on new home builders by 34 per cent at Tuesday’s council meeting. Development cost charges jumped $3,511 — from $6,758 to $10,269. That did not sit will with Kamloops Homebuilders Association executive officer Patsy Bourassa. She said the new tax will discourage people from building in Kamloops.
“If people here can’t get into a home, there’s something wrong,” she said. “They get it in the ear, basically.” Bourassa pegged the city’s plan to build a $16.8-million extension to McGill Road as the “primary” reason for the hike — taxes on new construction are used for city infrastructure projects. “This road, this extension is going to help a lot of people. Why are . . . new home buyers going to shoulder the cost of building the road?” Coun. Peter Milobar said city tax dollars will cover 10 per cent of the cost. “This is not strictly the homebuilders paying it.”

The three-phase project will connect McGill Road — which ends at a garbage and recycling centre — to a recently installed set of lights linking the burgeoning Guerin Creek subdivision to Summit Drive. Milobar said about $750,000 in DCC taxes have already been collected off new homes in the subdivision. “You have to look at the big picture,” he said. He conceded builders will shoulder most of the cost, because they are responsible for growth in that area. Conversely, he said if a project accommodates existing homeowners, the cost is divided more evenly between tax and DCC dollars. Bourassa also accused the city of gouging homebuilders, who are making a mint off Kamloops’ red-hot real-estate market. “They need more money and this is the simplist way of doing it,” she said. “They say: ‘You are making money and so should we.’ But Milobar said the increase accounts for rising construction costs. “The projects haven’t gone up — it’s the costs,” he said. “We need to build the roads to handle the increase in population.”