If you build it – enough of it – they will come.
With traffic woes and a water supply issue on the horizon, some residents of Cochrane may be wishing the fastest growing town in Alberta would just rein in expansion a bit, but a housing researcher says other towns and cities could learn a lot from following Cochrane’s example in the way of housing.
What’s been dubbed a national “housing crisis” has garnered much attention in the media lately, as many parts of the country grapple with affordability and access.
But there is no crisis in Cochrane, and none – yet – in places like Calgary and Okotoks.
The Okotoks comparison is particularly illustrative for comparison purposes in a paper just released by Robert Falconer at the University of Calgary’s School of Public Policy.
In his July 2023 report, “Permitting Affordability: Housing Policy in the Calgary Metropolitan Region,” Falconer outlines the striking similarities between Cochrane and Okotoks.
Both are in the foothills of the Rocky Mountains, approximately 30 to 40 minutes driving time from downtown Calgary. Each had around 32,000 people in 2021, and both have a median age of 39.2 years.
The median household income in Cochrane is $127,000, compared to $130,000 in Okotoks. A good portion of this income comes from Calgary – between 25 to 35 per cent of the labour force in each town commutes to the city for work.
Falconer’s research indicates that although all levels of government influence the construction and cost of housing, municipal governments wield possibly the greatest influence over housing costs through zoning regulations, which determine the type of housing that can be built, and building permits, which impact construction timelines and non-material costs of housing.
Cochrane has been able to keep supply in lockstep with demand through a plan that encourages flexibility in supply of different types of housing.
His report states that given the similarities in the two towns, there must be something going on other than external factors, to explain how Cochrane’s development policies have been so successful in keeping housing prices down in comparison to Okotoks.
“It is also unlikely that there is less demand for housing in Cochrane – despite similar population levels, the town has grown by roughly six per cent each year compared to two per cent in Okotoks over the same decade,” he states in his report. “Instead, the answer may lie with differences in municipal policies that influence the supply of housing.”
Falconer said from 2010 through 2021, the Town of Cochrane approved almost three times more building permits than Okotoks and also had more variety in the types of housing it approved.
Multi-family residences — often cheaper than single-family homes — represented around 46 per cent of new housing starts in Cochrane, compared with 16 per cent in Okotoks.
The report goes on to state that “despite higher demand for housing in Cochrane, housing there is $40,000 cheaper on average than in Okotoks, a town with similar demographic and economic characteristics. Higher permitting may be the reason, allowing the supply of new housing in Cochrane to match the higher demand.”
The variety of housing in Cochrane is also greater – multi-family dwellings represented approximately 46 per cent of new housing starts compared to 16 per cent in Okotoks.
In Calgary, residential permits and residential builds are not keeping up with the current demand for new housing. In Cochrane, the planning process allows a more flexible amount of supply to catch up with that demand.
Falconer concludes his study with a comment that Calgary planners may want to heed.
“The population of Canada hit 40 million people this summer and Calgary is the fastest growing city in the country with a population over a million,” he wrote. “Will the supply of housing be permitted to increase to match? Calgary permitting rates currently match Okotoks, but Cochrane provides an example that policymakers may choose to follow.”
In an interview with The Eagle, Falconer was reluctant to rank the bedroom communities’ success.
“From an economic lens, you take the words “good” and “bad” out of it – it’s more of a trade-off,” he said.
“More development in Cochrane brings a lot more construction, which can be disruptive, and there’s that debate over the small-town charm. And these are all valid concerns.”
He said relative affordability in Cochrane is good for young families, and also is something companies like Garmin may see as an advantage in encouraging their 30- to 40-year-old employees to settle down close to their workplace.
Kendra Watt of CIR Realty agrees the Town’s focus on multi-family housing like condos and row houses has helped home buyers in Cochrane.
“Those are the only homes that are affordable for people. You can’t get a single family detached home under half a million dollars right now,” she said. “There are zero under $500,000.”
And Watt’s numbers also back up the supply aspect of the story.
“The number of active listings in Cochrane is 155 and in Okotoks it’s 54,” she said. “So we have three times the inventory.”
Falconer splits his time between the London School of Economics in England and the School of Public Policy in Calgary. But he is also a former resident of Sunset Ridge. He and his wife got started in the housing market in Cochrane.
He has lived in neighbourhoods with a variety of housing types, with some retail mixed in.
“I think communities that allow more multi-family dwellings are more vibrant in terms of kids and community . . . a lot more people meet each other,” he said.
“A good example of allowing small business to mix into a neighbourhood is Sunset Ridge, with that little plaza area.”
Drew Hyndman, executive director of development and infrastructure services at the Town of Cochrane, said the Town recently revamped its land use zoning bylaws, which an eye towards achieving flexibility.
“We have a strategic plan, with specific objectives and we think that’s the most important thing is creating complete communities,” he said.
Flexibility is the key, Hyndman added. “There has to be choice.”
The unsung heroes in keeping up with the demand on new housing, Hyndman said, are the Town staff doing safety inspections on things like electrical, plumbing, and other areas pertaining to new construction.
Overall, Falconer said the Town of Cochrane’s flexible permitting approach seems to have been fairly successful in keeping housing prices relatively affordable for first-time buyers.
But he issued a caution as well.
“There’s some dark clouds on the horizon,” he warned. “The reason Okotoks had such low permitting levels is the issue of water licensing down there. Cochrane is getting pretty close to its water license (limit).”
As previously reported in The Eagle, current growth rate projections would see the Town of Cochrane’s existing license to draw water expire within about four years.
The dark cloud he refers to would be if that issue isn’t resolved, Cochrane may be forced to start limiting new development permits until the water issue is resolved.
Fewer permits would mean less supply, resulting in higher prices.
Asked about the water issue, Hyndman said the Town is in the midst of negotiating a new agreement with the province involving a transfer of rights to draw more water from the Bow River, but he couldn’t talk specifics at this time.
“We hope to be proceeding with some public notification in the fall, and have that water license early in 2024,” he said.
