The Economist makes an essential point:
Imagine two areas: Gotham and Pleasantville. Say the demand to live in Pleasantville increases a little while the demand to live in Gotham soars. And say that due to differences in land use restrictions, housing supply responds dramatically in Pleasantville and very little in Gotham. Then what we’ll observe in Pleasantville is a rapid increase in population and slower growth in prices, and what we’ll observe in Gotham is rapid growth in prices and slower growth in population.
And this is exactly what we have observed in the real world. Suburbs have seen massive housing growth and rapid population growth, but prices in central cities have soared, even in many places where population numbers are level or falling.
If no one wanted to live in central cities, prices for homes there would not rise. And indeed, several decades ago, prices for homes in big central cities were dropping. But that trend has clearly reversed. You can’t draw conclusions about demand shifts from population numbers alone. This is a very simple point, and yet it’s repeatedly ignored.
Especially by critics who claim the “Back to the City” movement, especially in the U.S., isn;t real.
Location, Location, Location.
Wasn’t one of the points of the town centres in the LRSP to enable more of these urban centres to exist throughout the region? This would help meet the demand for urban living and amenities while creating enough critical mass to provide decent transit connections between them. Instead of having Gotham + Pleasantville, we could also have Gotham -II, III, IV, etc. (with each their own character of course 🙂
Hopefully this Economist quote gets picked up thorughout the blogosphere, as it’s an important point.
Now, if I can turn it around and ask Gordon a question:
Rents as well as ownership costs in core cities, like Vancouver, continue to rise precisely because demand to live in the city continues to outpace new supply of housing. There are pleanty of “affordable” options in Pleasantville.
Is this a public policy problem? Or is this simple economics.
If it is a public policy issue, then the solution must be find a way to encourage more housing in Gotham. But anytime a significant change to density is suggested on any site, the opposition is overwhelming, often from life-long renters struggling to stay in the city (who if they were a “class” would most benefit from additional supply).
Is there a point when the city has to approach increasing density in many neighbourhoods as they have with the bike lanes: just push it though? (for the greater good of the city).
Unfortunately pushing through higher densities into single family areas is political suicide.
Look at EcoDensity – and it wasn’t even very dense.
Ditto with the Cambie corridor – all the density is along the arterials – the blocks farther in remain sacrosanct.
All in all, many zoning limitations – height limits, view cones, building separation – all serve to limit supply and keep prices high.
Soon, downtown will be “built out” – and you can’t easily tear down a strata-titled building like you can a rental building.
Ron,
Ron I agree, and That’s my point (that politicians won’t fight for more housing). Any proposed change in the city creates an opposition. there are always multiple sides to issues, even if some are not easy to fathom. Sometimes city politicians will just have to take a side, as the Mayor has with bike lanes, and stand up for what they believe is needed in the city.
I’ve been shocked at the opposition that can emerge to things like: fixing a broken down children’s playground; putting in wheelchair and stroller ramps on sidewalk curbs; putting in sidewalks, etc. And these people can be a very vocal minority that makes you think they represent more opinion than they actually do.
That’s why we need informed politicians to take a stand. Political suicide might actually be listening to the vocal minority rather than doing something that the silent majority wants.