A Look into BC’s Land Value & Housing Statistics
April 2024 | By Jack Jol
Key Points:
The majority (~76%) of BC’s land value is in residential properties ($1.5 trillion CAD).
In Urban Areas, approximately 80% of an average property’s value is its land value.
$77 billion CAD (or approximately 5%) of BC land classified as residential is vacant.
Differences between the BC and StatCan data suggest Canada’s total land may be undervalued by StatCan.
Annually, Statistics Canada as well as the province of British Columbia produce figures for their respective land value. Land value is a statistic of interest, as it plays heavily into our cost of living and is an important metric in understanding the nation’s wealth of resources. StatCan claims there are about $6.75 trillion worth of land in Canada, while BC Assessments claims about $1.97 trillion worth of land exist in BC alone. According to these metrics BC accounts for 30% of Canada’s land value, which seems significantly large, spurring further investigation into these datasets.
This research note serves not only to scrutinize statistical figures but to better understand the makeup of property values and their broader socio-economic ramifications.
THE VAST MAJORITY OF BC’S LAND IS RESIDENTIAL
Common Wealth Canada obtained a provincial datasheet from BC Assessments, in which land is divided into the following use categories: “Residential,” “Utilities,” “Supportive Housing,” “Major Industry,” “Light Industry,” “Business and Other,” “Managed Forest Land,” “Rec/Non Profit,” as well as “Farm.”
Below are three graphs that show the frequency and value of different types of land. Residential properties are dominant in both quantity and in value, with about 2 million residential properties on approximately $1.5 trillion of land (approximately 76% of the province’s total land value). This comes out to about $750,000 per BC residential property. A weighted average of these property values based on their reported frequency shows the average property costs approximately $1 million. These figures do not seem far-fetched and align with other reports of property counts, land values, and pricings for the province.
In the division of BC’s Land Value, the above graph emphasizes the significance residential properties have on the provincial landscape. Supportive Housing, Managed Forest Land, and Farmland do not have zero land value as this plot might suggest at first glance; rather, their total land value is dwarfed by the mass of residential land.
The Rec/Nonprofit category likely has as large an average land value as it does because the category encompasses a wide variety of property types, ranging from churches and nonprofit organizations to golf courses and ski resorts.
Here we can see the upwards of 2 million residential properties documented by the province and how their frequency scales when compared to other property types in the province.
The farmland data raises several questions. A total of approximately $1.3 billion of land over 50,000 farms are detailed in the datasheet. Followers of farming related news and statistics might spot this as odd, as Canadian and past BC census data would indicate this frequency is too high (2021 Census of Agriculture counted about 15,000 farms in BC), and that the average cost of farmland is too low, sitting at $25,000 per farm. According to Farm Credit Canada an average farm in the most affordable Peace-Northern region cost about $2,200 per acre in 2022. Paired with an estimated 327 acres per farm according to the Census of Agriculture yields a more realistic price of just under $720,000 for an average farm. Using the recorded land value in conjunction with the more reasonable approximation of 15,000 farms in BC divides the land figure into approximately $87,000 of land value per farm. This is still substantially below estimates. This suggests farm value data is underreported.
As farmland makes up a fraction of a percent (0.06%) of the total reported land value, it is unreasonable to claim that this is a source of discrepancy in the BC dataset compared to the national StatCan land estimates. Considering residential land values align well with reported land values and constitute the majority of the assessed BC land, it seems more likely that the Canadian land estimate is underreported.
RESIDENTIAL PROPERTIES: WHAT'S GOING ON?
As we are in the midst of a housing crisis, it’s no surprise that property values for BC residences are high, but how much of this cost is attributed to the land below each dwelling? BC Assessments sheds insight onto this matter. We can see that in areas such as Vancouver, White Rock, and Richmond, almost 80% of residential property value is accounted for by land. In other words, for every million dollars of property you buy in these areas, you can expect about $200,000 worth of house. At approximately $200 per square foot, a million-dollar home in these areas will yield you about 1,000 square feet of home.
VACANCY!
The data for residential properties was further classified using a methodology that allowed for the isolation of vacant residences from other residential properties. Though the cause of vacancies is not specified, it seems worth noting amidst a housing crisis that there is a reported $77 billion worth of vacant residential land in the province.
A further breakdown of each area’s residential land distribution is available for each region, but for the sake of this summary we will look at Vancouver in isolation.
As can be seen above, Vancouver has the lowest vacancy rate among all listed areas in the datasheet. This still amounts to $3 billion worth of land and almost 600 homes not being occupied.
CONCLUSION
This research note was provided to surface interesting observations about BC’s land value utilization we have noticed, as part of a larger project being undertaken at Common Wealth Canada. This project’s goal is producing a tax shift proposal for BC which alleviates income tax in exchange with a land value tax in order to confront the pressing issues of housing affordability and equitable land utilization head-on.
In addition to this note, we also have published a note “What’s driving up property values?“ looking at evidence of a housing bubble drawn from the same data set.
Overall we find that BC’s land value data does not suggest the province is overreporting its land value, which suggests the possibility that StatCan is underreporting the national land value. We note the dominance of residential properties in shaping land values and note that there is significant vacancy and underutilization, which, particularly amidst a housing crisis, calls for a nuanced approach to policy-making and urban planning.
