Kelowna Set to Review Density Bonusing Program to Focus on Affordable Housing
Living in Kelowna is an incredible lifestyle choice—lake views, wineries, outdoor recreation, and a vibrant city core. But like many communities in British Columbia, housing affordability has become one of the biggest challenges facing residents.
That’s why Kelowna’s density bonusing program is back in the spotlight. City council is preparing a review to ensure it supports affordable housing, aligns with provincial legislation, and makes the most impact for the community.
👉 In this blog, we’ll break down what density bonusing is, how it works, what changes are being considered, and—most importantly—what it means for buyers, sellers, and investors in the Kelowna real estate market.
What Is Density Bonusing?
Density bonusing allows developers to build more floor area than zoning normally permits—but only if they contribute funds to community needs.
How It Works
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Developers apply for density bonuses on new projects.
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They contribute money to one of two funds:
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Housing Opportunities Reserve Fund (HORF) – Supports affordable housing.
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Public Amenities and Streetscape Reserve Fund – Funds things like sidewalks, landscaping, and street furniture.
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In exchange, developers are allowed extra height or floor space.
Why Kelowna Introduced the Program
Kelowna adopted the density bonusing system about three years ago to:
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Offset the impacts of taller buildings on neighborhoods.
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Fund affordable housing and public amenities.
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Provide structure and fairness—so developers gave back to the community when requesting more density.
Results So Far
Since its launch, Kelowna has seen:
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20 development permits requesting density bonuses.
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10 approved projects already contributing:
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$664,111 → Public amenities
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$480,000 → Affordable housing
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$1.1 million collected in total.
Another 10 projects are in the pipeline, expected to add $3.2 million more in contributions.
Why a Review Is Happening Now
Several reasons are driving this review:
1. Provincial Legislation
BC has updated housing laws, requiring Kelowna to align density bonusing with provincial standards by June 2026.
2. Affordable Housing Priorities
City staff have identified affordable housing as “the single largest housing gap” in Kelowna. Redirecting more funds toward housing is a top priority.
3. Limited Impact of Streetscape Fund
The Neighbourhood Street Urbanization Program (launched in 2024) now covers many street improvement needs, making the streetscape fund less critical.
Council Debate: Keep, Revise, or Scrap It?
Not all councillors agree on the program’s future.
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Coun. Stack: Raised concerns that density bonusing adds uncertainty for neighborhoods. He even suggested ending the program entirely.
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Coun. Wooldridge: Supported focusing more on affordable housing but reminded council that the program prevents “free rides” when developers request extra height.
This tension highlights the balance between provincial density mandates and local neighborhood concerns.
What Changes Are Being Considered
City staff will explore:
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Redirecting most contributions into affordable housing.
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Making contributions more appealing to developers.
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Possibly eliminating the program if it proves ineffective.
Next steps include hiring a consultant, completing a financial feasibility study, and engaging with the housing industry before a final report comes back in early 2026.
What This Means for People Living in Kelowna
If you’re living in Kelowna or planning on moving to Kelowna, here’s what this could mean:
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Buyers: More density could increase supply, easing prices in the long run. But affordable units won’t appear overnight.
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Sellers: Higher density allowances could impact resale values—especially in neighborhoods where taller projects are introduced.
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Investors: Density bonusing and affordability requirements can affect project costs and timelines, shaping future returns.
👉 📥 Download our free Kelowna Home Buyer’s Guide today for practical tips on navigating this evolving market.
The Bigger Picture: Growth in the Okanagan
Kelowna isn’t alone. Other Okanagan cities like West Kelowna and Lake Country are also dealing with growth, affordability, and densification pressures.
Living in Kelowna means being part of a region balancing Okanagan lifestyle appeal with the realities of housing demand.
Frequently Asked Questions (FAQ)
❓ What is density bonusing in simple terms?
It’s when a developer pays money to the city so they can build bigger than zoning usually allows.
❓ Where does the money go?
Funds go to affordable housing projects or public amenities like sidewalks and landscaping.
❓ Why is Kelowna changing the program?
Because affordable housing is the city’s biggest need, and provincial laws require updates by 2026.
❓ Will this lower home prices in Kelowna?
Not directly—but it could increase affordable housing supply, which helps with long-term stability.
❓ How does this affect me if I’m buying a home?
Developers may adjust project pricing, but more density means more homes for sale in Kelowna, which helps balance demand.
Opportunities and Challenges Ahead
The Kelowna real estate market is at a turning point:
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Opportunity: Redirecting millions toward affordable housing could make Kelowna more inclusive.
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Challenge: Balancing densification with neighborhood concerns remains tough.
For anyone living in Kelowna, this program review will influence not just future housing supply but also the character of local neighborhoods.
Thinking of Buying or Selling in Kelowna?
The market is shifting, and policies like density bonusing can play a role in what homes come available and at what price.
👉 See the latest homes for sale in Kelowna here.
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Final Thoughts
Kelowna’s review of its density bonusing program is more than just city policy—it’s a reflection of the housing challenges shaping the future of the Okanagan.
Whether you’re considering buying in Kelowna, selling your home, or simply keeping an eye on the market, understanding these changes helps you make informed decisions.
✅ For expert guidance, contact Mark & Maddie with the Selling Kelowna Real Estate Group | eXp Realty today.
📞 Phone: 778-744-0872
📧 Email: [email protected]
Because when it comes to living in Kelowna, having the right real estate partner makes all the difference.