Cold Lake city council is stepping up efforts to address a looming housing shortage, approving increased incentives for rental development while introducing a new program to encourage residential lot creation.

The decisions come as the city prepares for significant population growth tied to economic expansion and the 4 Wing Cold Lake Future Fighter Capabilities Project, which is expected to bring hundreds of new permanent jobs to the region over the next several years.

Council boosts rental housing incentive

Council approved amendments to the city’s Multiunit Rental Housing Incentive Program, increasing the grant from $10,000 to $15,000 per unit for new multi-family rental developments.

The program applies to projects with at least four units, which must remain on the rental market for a minimum of five years.

Administration said the increase reflects the current economic reality facing developers.

“There is considerable movement in regards to housing requirements within the city… we have got some interest… to build multi-family dwellings,” administration told council.

At the same time, builders are facing higher costs and tighter financing conditions.

Administration pointed to:

• Rising construction and material costs
• Higher interest rates
• Limited lender appetite for projects in smaller markets
• The added cost of building in a more remote region

Despite early inquiries, the city has not yet received a formal application under the current program.

Council also approved renewing the program for another year, allowing applications to continue through 2027.

New tax rebate aims to unlock residential lot development

Alongside the rental incentive increase, council also supported the creation of a Residential Lot Development Incentive Program to encourage developers to build new subdivisions.

The program is designed to address a key issue identified in the City’s Housing Needs Assessment — a shortage of build-ready residential lots.

Under the proposed policy, developers could receive:

• Up to 100 percent of the municipal portion of property taxes rebated
• For up to six years, or until the lot is sold or developed

Administration said the goal is to reduce the financial risk of developing land that may not sell immediately.

“Without significant growth in housing supply commencing now, Cold Lake will not be ready to respond to growing housing demand,” administration said.

Learning from past growth cycles

The push comes as Cold Lake looks to avoid repeating challenges seen during the last major economic boom.

Between 2011 and 2014, rapid population growth driven by oilsands development strained the housing market, leading to near-zero vacancy rates and sharp increases in rent and home prices.

When the economy slowed, developers were left with unsold inventory — a situation that continues to influence development decisions today.

Administration said that history is part of why developers may be hesitant to move forward without additional incentives.

Preparing for what’s next

With new economic activity already underway and major projects on the horizon, council is aiming to act early rather than react to a housing crunch.

The combined approach targets both sides of the issue:

• Increasing rental supply through higher per-unit incentives
• Expanding available land through tax-supported subdivision development

Council supported both measures, signalling a broader strategy to ensure the city is ready for the next phase of growth.