New homes

Picton subdivision survives scrutiny

The developer has built hundreds of homes. In and around this community. Over four decades. Eric DenOuden knows how to develop and build places for regular folks to live. He wants to develop 325 new homes in Picton.

According to most social, financial and policy experts, Canada isn’t building nearly enough homes. Public polling suggests most Canadians agree the nation is enduring a prolonged housing crisis.

One could imagine Prince Edward County council welcoming the prospect of a local, proven and trusted builder coming to ease the challenge. That they might see it as an opportunity to make up for a wasted decade in which new homebuilding stagnated while home prices skyrocketed.

But habits…

Tulip Estates development is located on 22 hectares of land that rises along the hillside as one leaves Picton headed east along County Road 8. DenOuden’s Hilden Homes plan calls for a mix of residential housing formats including singles, semis, towns and apartments.

Development of the project is constrained by water and sewer capacity. Shire Hall will keep the developer on a short leash.

The developer was before the planning committee of council last week seeking draft plan approval. He faced a surly crowd. Some councillors were cross about the loss of trees on the hillside, others sought to ensure new homes were affordable.

The developer explained that many factors go into the price of a home. Land costs, development charges, servicing costs, borrowing costs, building costs, trades and such.

What he left unsaid were the basic laws of housing economics: Ultimately the developer’s profit margin—that is the difference between the cost and the sale price—is set by the market (buyers and sellers). It is a function of supply and demand. When the supply of new homes is strong, margins get squeezed lower in search of buyers, thus reducing the price of the home. When a community fails to build enough homes, margins widen as housebuyers chase the few homes available. It is a phenomenon this community has endured for 15 years.

Yet, some Council members are seemingly unaware they are part of the problem. Some seek to defy the laws of economics. That it is in the developer’s power to do so. All council had to do is ask. And to imply approval approval is conditional upon the developer giving the right answers.

Councillor Bill Roberts wanted to know what percentage of units—in what is currently an empty field—would be affordable.

DenOuden explained that it is the market that sets the price and that it was impossible to predict the vast set of variables that would determine prices in the future. He added that Hilden Homes builds affordable homes that meet the needs of the local market. That it had done so for many years.

“We tend to build houses that are affordable,” explained DenOuden.

The Sophiasburgh councillor then pitched the notion that Hilden connect with the County’s Affordable Housing Corporation.

“I am open to all kinds of discussions” said DenOuden. “ I have been on a committee in Quinte West for affordable housing, so I have some background into some of that.”

Ameliasburgh councillor Janice Maynard remained sceptical that markets set prices, vaguely suggesting the builder and planner were trying to hoodwink Council— that it was blurring demand for housing formats with profit margin—that one was legitimate, the other was not.

Councillor Maynard followed up by accusing the builder of “buying his way out of providing parkland”.

The developer’s planner Mark Touw of IBI Group, said the size of the parkland was determined with the County’s planning staff. Planning director Mike Michaud corrected the councillor’s assertion.

“We are not averse to the size of the parkland, but to its location,” said Michaud. “We don’t need more parkland, we just want it moved.”

Councillor Phil St-Jean sought to ensure rental units were part of the project. Touw explained that the apartment block would be developed by another builder and that such answers would be forthcoming at a later approval stage.

Councillor Brad Nieman wanted to confirm new commercial space (i.e. convenience store or other retail) would be part of the plan.

“We are moving farther out of town, away from all the stores and that, and for me, anyways, I believe it is prudent when we are passing these subdivisions to have those commercial spots where you can have the stores closer to where the population is growing,” he said.

“It is a good location for that, and certainly its an area extending further away from Main Street, where it is not necessarily walkable to local commercial or those types of uses,” said Touw, who also noted that as the plan currently sat, it wasn’t a mandatory requirement.

Some of the neighbours would rather the development not happen at all.

Michael Jowett lives on Owen Street. He says the developer has an advantage that the neighbours do not.

“Our house is there,” said Jowett. “We can’t pack it up and go somewhere else. We are going to be asked to accommodate a new reality.”

Susan Fowler lives on Bridge Street, directly beside the Port Picton development, and worries that more development will mean even lower water pressure.

“We have lived here for over 51 years, so we have witnessed quite a bit of change in the neighbourhood,” said Fowler. “We are concerned that the Tulip Estates development will negatively impact what is already a low available water pressure and flow. We realize that there are future plans to upgrade the water delivery system on Bridge Street, but until that happens, we are going to continue to be negatively impacted by subdivisions such as this.”

In the end the plan was approved. But not before some changes were made. Notwithstanding the stated desire for affordable rental units, Council reduced the height of the apartment block from 18 metres to 15 metres. It also wants the builder and developer to define the amount of commercial space provided in the development.