dcl and cac payment changes in vancouver explained for builders and landowners
Vancouver just gave developers a new tool to unlock stalled projects — and landowners a stronger chance to close deals.
As of June 2025, the City of Vancouver now lets builders pay Development Cost Levies (DCLs) in three instalments instead of all at once. DCLs are per-square-foot fees paid to the City at the time of building permit — typically used to fund roads, parks, and utilities. CACs (Community Amenity Contributions), which are separate and negotiated during rezoning, can also now be partially deferred.
That shift alone can free up significant capital during the early stages of a project — often the most financially fragile time.
In this post, we break down exactly what changed, how much money this frees up, and what it means for your next project or land deal. We’ll also compare Vancouver’s new approach to the province-wide policy coming in 2026 — and show you real-world examples with accurate DCL numbers based on the City’s latest rates.
If you want to understand what these new rules mean for land sales, deal certainty, and project cash flow — you’re in the right place.
dcls no longer need to be paid all at once
Until now, Vancouver developers had to pay 100% of Development Cost Levies (DCLs) upfront when they applied for a building permit — sometimes millions of dollars, all due at the start of a project.
That’s changed.
Now, if your DCL bill is over $500,000 (which most multi-family projects are), you can break that payment into three equal installments:
One-third at building permit
One-third 12 months later
One-third 24 months later
There’s no interest, no inflation indexing, and the amount is locked in at the time of permit. You just need to provide security in the form of a surety bond or letter of credit.
what this means for developers
This frees up hundreds of thousands — even millions — in early-stage capital. You don’t have to raise or borrow that money at the most vulnerable moment in the project. That improves cash flow, reduces interest costs, and may even allow you to start construction earlier.
what this means for landowners
Deals are more likely to close. When buyers don’t need to lock up as much capital for fees, they’re less likely to re-negotiate or walk away. It also makes borderline sites more feasible — meaning landowners may see higher offers, or renewed interest on previously stalled sites.
cac payments now start smaller and come later
For projects that require rezoning, Vancouver used to require the full CAC (Community Amenity Contribution) to be paid at the time of rezoning enactment. That often meant a $10M–$30M bill before a single shovel hit the ground.
Now, the upfront CAC payment is capped at $5 million, with the balance deferred for up to two years or until building permit. Interest is charged at prime + 1%, and developers can use a combination of surety bond and letter of credit to secure the balance.
what this means for developers
You can secure zoning with a fraction of the cash outlay. That means more projects can move from approval into reality — and your equity can go further.
what this means for landowners
Zoning certainty becomes more valuable. If your site needs a rezoning, the buyer doesn’t have to raise the entire CAC up front — meaning deals are more likely to get through financing and proceed to closing.
surety bonds now unlock more capital for developers
Vancouver now accepts on-demand surety bonds for a much wider range of obligations — including DCL and CAC deferrals. These replace letters of credit and don’t tie up your borrowing capacity.
what this means for developers
Surety bonds are cheaper to carry and easier on your balance sheet. You’re not locking up cash or reducing your credit line with the bank. To use a surety bond, developers must work with an approved insurance provider and ensure the bond meets the City’s “pay-on-demand” requirements. Most large institutional builders already qualify, but smaller developers may need to check with their broker or financial advisor.
what this means for landowners
More liquidity means more leverage. Buyers can stretch further on land offers when their capital isn’t trapped in standby securities.
inflation-related fee increases cancelled for 2024 and 2025
Two planned DCL inflation adjustments — a 5.7% catch-up from 2024 and a 3.2% increase in 2025 — have both been permanently cancelled. Rates will remain frozen at 2023 levels through at least 2025.
what this means for developers
This is real savings — especially on larger projects. While inflation is still hitting hard in construction, at least city fees won’t be increasing too.
what this means for landowners
Cost stability improves project confidence. Developers can price their deals more accurately and won’t be spooked by sudden jumps in municipal fees. That makes it easier to strike a deal now.
two project examples show the impact of dcl deferrals
Let’s look at two hypothetical projects to see how DCL deferrals play out using the correct rate of $38.42 per square foot, which includes both the city-wide DCL and utilities DCL for higher-density residential developments.
50-unit wood-frame apartment
6-storey, 50-unit project
~50,000 ft² total
DCLs: $38.42/ft² × 50,000 ft² = $1.921 million
Before the policy change:
Full $1.921M due at building permit
Now:
$640,333 due at permit
$640,333 due at 12 months
$640,333 due at 24 months
Impact: About $1.28 million in early-stage capital is deferred — reducing financing stress and improving feasibility. That makes it more likely the project proceeds, which also improves the chances that a land deal closes.
150-unit concrete high-rise
20-storey, 150-unit tower
~130,000 ft² total
DCLs: $38.42/ft² × 130,000 ft² = $4.994 million
Before the policy change:
Full $4.994M due at building permit
Now:
$1.665M due at permit
$1.665M due at 12 months
$1.665M due at 24 months
Impact: Over $3.3 million stays in the developer’s pocket during the early stages. That can dramatically reduce interest costs and equity requirements, increasing the likelihood of getting the tower built — and supporting stronger land offers or more reliable closings for landowners.
While these examples focus on mid- and high-rise developments, smaller projects like 3-lot assemblies or multiplexes can also see benefits — especially if they cross the $500,000 DCL threshold. Even on smaller infill sites, deferring $200K–$300K in fees could be the difference between a feasible build and a shelved plan.
how vancouver’s policy compares to the province’s approach
Vancouver’s DCL deferral policy is very similar to what the Province of B.C. has announced for other municipalities. But there are some key differences worth noting.
city vs province: the main differences
| undefined | Vancouver | Rest of BC (2026) |
|---|---|---|
| Upfront Payment | 33% | 25% |
| Deferred Payment | 24 months | 48 months or until occupancy |
| Security | Surety bond or LOC | Surety bond or LOC |
| Applies to DCL/DCC over | $500,000 | $500,000 |
what vancouver does better
No interest on deferred DCLs — the amount is locked in.
Policy is already in effect (as of July 2025).
Coordinated with CAC and surety bond policies for full cash flow alignment.
what the province does better
Longer deferral window — up to 4 years or until occupancy.
Lower threshold means smaller projects can also benefit.
Applies to regional DCCs too, including Metro Vancouver and TransLink fees.
Read a breakdown on the provincial policy here.
why all this matters for your land
If you’re a landowner, here’s the bottom line:
Deals are more likely to close. Lower upfront costs reduce the number of contracts that collapse at the financing stage.
Stalled sites may now “pencil.” Developers are re-running the numbers. If you had interest in the past, it may be worth re-engaging.
You may see stronger offers. When developers don’t have to park millions in upfront fees, they can stretch further on land. That’s because the deferred fee structure improves project cash flow, which can increase the residual land value — the amount a developer can afford to pay for your site while still hitting their financial targets.
You have a strategic window. These deferral policies are temporary. Acting while they’re in place could give your site a competitive edge. These changes are in place now — but they may not last forever. Acting during this deferral window could improve your negotiating position while incentives are still active.
curious how this impacts your site?
If you own land in Vancouver and want to understand how these changes affect your property, project timing, or the kinds of offers you might receive — let’s talk.
I specialize in helping landowners navigate complex policies like DCLs, CACs, and zoning updates. Whether your site stalled out in a tough market or you’re just starting to plan, now may be the right moment to revisit your strategy.
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City of Vancouver. (2025, June 17). Vancouver takes action to keep rental and strata housing projects moving in challenging market conditions. https://vancouver.ca/news-calendar/rental-strata-housing-projects-challenging-market-june-2025.aspx
City of Vancouver. (2025). Development Cost Levy Bulletin (June 2025). https://guidelines.vancouver.ca/bulletins/bulletin-development-cost-levies.pdf
City of Vancouver. (2025, June 3). Council Report: Supporting Development Viability and Unlocking New Housing Supply (RTS 17891). https://council.vancouver.ca/20250611/documents/pspc3.pdf
Storeys. (2025, June 13). Vancouver proposing suite of changes to DCLs, CACs to support project viability. https://storeys.com/vancouver-dcls-cacs-policy-changes-2025/
Journal of Commerce. (2025, July 4). Will the City of Vancouver’s recent changes spur new housing construction?https://canada.constructconnect.com/joc/news/government/2025/07/will-the-city-of-vancouvers-recent-changes-spur-new-housing-construction
Urban Development Institute (UDI) – Pacific Region. (2025). Advocacy Update: DCL and CAC Deferral Policy Changes – City of Vancouver. https://udi.bc.ca
British Columbia Ministry of Housing. (2025, July 2). More flexibility for development charges will unlock more homes for people. https://news.gov.bc.ca/releases/2025HOUS0070-001228
Canadian Mortgage Professional. (2025, July 3). B.C. homebuilders welcome deferral of development fees amid housing slowdown. https://www.canadianmortgageprofessional.ca/news/government/bc-homebuilders-welcome-deferral-of-development-fees-amid-housing-slowdown/384742
Real Estate News Exchange (RENX). (2025, June 18). Vancouver to allow phased DCL and CAC payments to boost housing starts. https://renx.ca/vancouver-to-allow-phased-dcl-cac-payments-to-boost-housing-starts
Business in Vancouver (BIV). (2025, June 28). Metro Vancouver increases development cost charges, defers federal funding. https://biv.com/news/real-estate/metro-vancouver-increases-development-cost-charges-defers-federal-funding-8273577
Palmquist, B. (2025). LinkedIn commentary on Vancouver fee deferrals and project viability. https://www.linkedin.com/in/brianpalmquist/
Geller, M. (2025). Personal blog and public commentary on DCL/CAC reform. https://gellersworldtravel.blogspot.com
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