Vancouver real estate investors who purchased a six-acre riverside property in Port Alberni, B.C., plan to deliver affordable detached houses in a scenic waterfront location, close to town.
But they face a challenge: zoning rules don’t allow modular housing on the site at 5350 Falls St., even though the construction type, once derided, has made major leaps in design and quality. Modular now has support from provincial and federal policies, but it can still be held back by outdated zoning rules that classify it as a mobile home.
David Wolstenholme, president of TerraPartners, and his partner, Shaun Greenaway, wanted the option to install modular housing on the site to speed up construction and reduce costs. They say a small detached house could be built for less than $700,000 using the latest in factory-built housing technology, whether it’s modular or prefabricated.
Mr. Wolstenholme and Mr. Greenaway purchased the former trailer park property on the Somass River, which had been rezoned for multifamily housing by the previous owners. TerraPartners – who build a lot of rental housing – completed erosion control along the riverbank and prepared the site for 31 homes.
Editorial: Canada needs a blueprint for modular homes
“We looked at this property, and we went, ‘Holy cow. This is like a Whistler-style benchland property where you have your own valley trail around it,” said Mr. Greenaway. “And we could build our own pocket neighbourhood; our own community.’ I see community gardens. I see parks and beaches and rope swings. And it’s just, how can we do this and make it affordable?”
“You can buy a brand-new home in a waterfront community with a warranty for effectively the same price as a 50-year-old home in the same community,” said Mr. Wolstenholme.
Government policies aim to modernize housing construction, but those pushing the new methods say there’s a reluctance to depart from conventional ways, even with a serious drop in housing starts. The Canada Mortgage and Housing Corporation’s 2026 housing market outlook report says new home construction “is set to decline through 2028 as developers face high costs.”
Today’s modular homes can look as good as any on-site contemporary stick-frame construction, say advocates. Factory-built housing is commonplace in European countries, but in Canada, it has been slow to get traction. The factories exist, but operate below capacity. Government support is increasing, but popular misperceptions about what modular is, and old-school zoning policies stand in the way of its more frequent adoption.
Throughout B.C., municipalities are grappling with rising housing costs, homelessness, and increased demand for affordable housing. Ottawa is incentivizing innovative housing by providing grants and low-interest financing through CMHC. The B.C. government introduced standardized fourplex and sixplex designs for small-scale multiunit housing.
Burnaby is currently working with industry advocates Modular BC to deliver fourplexes and sixplexes, and that city’s mayor, Mike Hurley, is part of a mayors’ task force to help other communities embrace modular housing.
Modular BC’s Paul Binotto recalls installing a modular lane house in a single day in Vancouver, over a decade ago.
“Modular is not something new,” said Mr. Binotto. “We are finally recognizing an important building process that Europe and other countries have embraced for years.
“Cities that don’t become more modular-inclusive are going to be limiting resources to help families, first-time buyers and multigenerational needs with quick, affordable solutions.”
The general idea is to speed up housing supply and reduce costs. Factory-built components typically include panelization, such as a wall or floor panel shipped to the site and craned into place. Another option is modules, such as a room or an entire home, which are shipped to the site and assembled onto a foundation, like LEGO blocks. Mr. Binotto says around 4.5 per cent of B.C.’s housing is modular, but advocates want to see that grow to 25 per cent.
Mr. Wolstenholme and Mr. Greenaway considered the local market and decided a target price point would be around $700,000 for a small detached family home on a bare-land strata lot, where owners hold title to their homes and share the public amenities. Because it’s a new build under $1-million, first-time buyers are exempt from the GST.
Zoning won’t allow a fully modular home, but builders routinely use prefabricated components to speed up construction and keep costs down. So, the next best option is a hybrid style construction.
“We’re two guys who had a dream for four years and hung on and are getting traction,” said Mr. Wolstenholme.
Still, they wonder why it’s so hard to find innovative solutions in a housing crisis.
“In general terms, what is the housing plan for Canada?” he asked.
“All those factories that seem to go out of business making factory housing, it’s because you don’t have enough consistent volume to keep your machines going all the time,” he said. “We need all the government levels aligned, federal, provincial, municipal, on housing choice, housing continuum, housing product.”
After all, the issue isn’t the construction type, which is CSA-certified and conforms to the building code, but simply how some municipalities classify modular housing.
Mr. Wolstenholme calls it “an alignment problem” between governments.
“Some jurisdictions still associate modular with trailers,” said Mr. Binotto. He says all factory-built housing meets the A277 quality assurance standard under the BC Building Code. “These are beautiful homes, built quickly and in some cases with a 43 per cent reduction in emissions and 50 to 70 per cent less waste.”
Another misconception, he said, is that modular will take jobs away from local contractors. Instead, he said, those contractors would go from building two or three homes a year to 10 to 12 homes a year.
In the meantime, the Port Alberni partners have been told they would need to apply to rezone the land back to a mobile home park if they want to build modular homes. For now, fully modular construction is off the table. Still, the city is an attractive market, Mr. Wolstenholme said, and they are well-positioned, regardless of construction method.
Their plans to build modular stymied, they have turned their attention to selling the building lots individually.
They’ve listed several lots on the multiple listing service, with a 2,178-square-foot lot priced at $189,000 and a 5,227-square-foot lot at $285,000. They’ve sold five lots so far.
“Our sole focus is on providing fully serviced lots in a waterfront community that make financial sense to builders and their end user clients,” Mr. Wolstenholme said.
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