My Business in Vancouver column:
What will be the toughest issue in the upcoming civic election? The issue that all candidates will pay lip service to, will criticize their opponents for not effectively addressing, but for which they will have little to contribute – save for bromides, vague promises and calls for senior government action?
Housing, of course. Affordable housing in particular.
Within the City of Vancouver’s jurisdiction and boundaries, there’s not much hope for those who are too poor to afford the median prices of market housing but too rich to be eligible for social housing. Yet to seriously add sufficient supply, politicians would have to do the unspeakable, which is to change the character of stable neighbourhoods to effectively lower the value of the existing housing stock.
Here’s the problem. Over the last half century, from Champlain Heights to Coal Harbour, we have built much of our new housing on “empty” land where we didn’t have to impose on existing communities – a minimum of 2,868 units per year, the average number the city has been accommodating for the last 35 years.
Needless to say, they have not been equitably distributed in the 22 neighbourhoods that make up Vancouver. Downtown, not including the West End, has taken the most: 676 units on average, rising to more than 1,300 a year in the last decade. (The lowest: Shaughnessy. Average number per year? Three.)
It was enough to keep the pressure off – and yet still resulted in some of the most expensive housing in Canada. But now we’re holding on to the little industrial land we have left – and the pressure is being felt in both the rising cost of the existing housing stock and the resistance in neighbourhoods to accommodating even the traditional increases.
Take the West End.
Almost every building higher than five storeys was built in just over a decade in the 1960s when the housing stock quintupled. All those highrises with thousands of one-bedroom apartments absorbed a generation of singles in the new service economy of post-war Vancouver. Rents were affordable.
But now, in the “traditional” West End, the number of new units per year has dropped to about 87 – half that if new towers on Burrard are omitted. The old West End has the growth rate of Dunbar – and it’s still considered too much by those opposing new development.
Rates-of-change bylaws have slowed growth to practically zero. Demolition and replacement of old low-rise apartments with higher densities, considered politically suicidal, is effectively discouraged. Both left- and right-wings of council are promising more “community consultation” – which is code for more process and less product. Yet the affordability crunch remains acute in one of the only cities in the western world seemingly immune from the Great Recession.
So what are the likely outcomes?
Densities will go up anywhere they can be squeezed in – along arterial roads like Cambie and Kingsway, in back lanes and in secondary suites. Helpful, but not likely in the numbers sufficient to ease housing costs.
Growth and affordability will go elsewhere – particularly along the transit corridors feeding Vancouver. Fortunately, Burnaby, Surrey and Richmond seem prepared to accommodate growth for Vancouver’s sake.
Finally: in-crowding. More people in the same floor space. That’s what happened in Vancouver from the 1930s to the 1950s, resulting in the decaying housing stock that was cleared out in places like the West End for a new generation of highrises. There are already some early signs of this.
It’s few people’s preferred solution, but it’s likely to happen by default – without any politician having to articulate the unspeakable. •
So many of the arterial roads are just single family houses. It’s way past the time when they should be getting built up. At the very least, they should be townhouses.
Fun West End story relevant to this. I was approached by one of the anti-development petitioners asking me to sign a petition against a new project in the West End. Now, I’m a renter and also pretty left leaning so I’m not overly moved by people fretting about losing their view, but the tack that this petitioner tried to take with me was that they were opposing this new development in the name of affordable housing! They wanted to “save” affordable housing in the West End by opposing almost all new developments.
I honestly didn’t know whether to laugh or cry. It’s basic supply and demand and as long as the demand for housing in the West End and Vancouver continues to increase faster than new supply can be provided, prices will continue to rise.
You can play around at the margins, with regulation and preservation of older less desirable buildings but at the the end of the day there is only one long term solution to affordable housing: new units. And I think most people in Vancouver accept that. As long as you don’t dare build those new units in my backyard!
Couldn’t agree more. I’ve been seeing this a lot in Mount Pleasant – people are geuninely convinced that preventing new dense development near transit is the best way to lower housing prices.
When confronted on this, they’ll usually say that new development should be contextual (i.e. neighbourhoods should not change), or that new buildings might inflate rents in the surrounding area (nevermind that to the extent that this occurs, it’s because of positive externalities).
Like Jack Hope, I don’t know whether to laugh or cry.
From the standpoint of density, I think it’s reasonable to say that the West End and downtown as THE densest neighbourhoods have done their part, and to cry about gentle densification going forward in some trite artificial construct known as “traditional” West End appears to be petty trimming around the hedges. It is good however to see focus on the neighbourhoods that have not done their part to keep up, where people down-sizing may want to age in place.
Since people love to reference the 2006 census when it comes to facts about the West End, let’s take a look at average rents shall we? http://www.vancouversun.com/business/vanmap/5194660/story.html
…how about that; rents in the West End are average, or in some areas, less than the average of rents in all of Metro.
Also how is it that according to the last CMHC report, vacancy rates have gone up and yet rents went up as well if it’s just about supply? What is a certainty is that spot rezonings cause uncertainty for developers and homeowners, spot rezonings hike property values and increases rents locally. And that is before the further uncertainty caused by the STIR program that gives breaks to developers on development cost levies in exchange for unbridled FSR density aka profit giveaway.
As a city that relies on DCLs and CACs to fund its amenities & infrastructure and balance its growth, especially in light of recent years parks board cut backs, we have to be honest with ourselves and either accept higher property taxes (and rents) across the board to fund our amenities, or continue to rely on new development levies.
I am not aware of any group in the West End who are anti-development as you mischaracterize one issue into another, and to suggest otherwise warrants you substantiate that claim. Otherwise it’s inflammatory and as someone in a faculty of education, you should know better than to engage in this manner. But I guess once a politician?
“Fortunately, Burnaby, Surrey and Richmond seem prepared to accommodate growth for Vancouver’s sake.”
You say that as if they are performing some kind of noble charity. And that’s the folly of density, the suggestion that somehow sprawl won’t occur in the rest of Metro if we just build those towers in Vancouver. GRIDS indeed.
Reilly is “positive externalities” the new way of saying gentrification? Or of whitewashing the ‘geographic rent increase clause’ that the province allows when a building sets the rent for the local area? You can google that since it appears you’d choose to be dismissive and ignorant when listening to others who don’t sound like an echo chamber.
“Reilly is “positive externalities” the new way of saying gentrification?”
Sigh. Do I really need to explain externalities to someone who just called me ignorant? Read what I said again, I didn’t say that new development won’t increase the value of surrounding properties.
However, to the extent that new developments increase rents in the surrounding area, it’s because they make the area more desirable to live in and do business in. Just like transit improvements and better parks might do the same.
Putting a moratorium on amenity improvements in low-income neighbourhoods would be a really awful anti-poverty policy with a ton of side effects. For exactly the same reasons, preventing new dense transit-centric development is also terrible anti-poverty policy.
Given your previous inclination to characterize people’s legitimate concerns with simple-minded and derogatory name-calling like “nimbys” or “wingnuts”, I would suggest the more explaining you can do for yourself the better so as not to come across as ignorant, yes.
You’ll catch more flies with honey than vinegar so to speak. At least it’s a start it seems to see some intellectual honesty that this isn’t about creating affordability, but more so renewing neighbourhoods, and how that gets funded by pushing a certain form of development.
I used to believe that increased supply would lead to lower prices, economics wise it should. The reality is that supply is only increasing to meet demand and not surpass it. The developers do their best not to overbuild. So the new reality is prices do not lower as supply increases. In fact if we look at places with the highest density levels, they do not have the cheapest prices but in fact the highest prices ie Hong Kong, Paris, London, New York, etc etc. There are examples worldwide that you can not densify yourself to lower prices.
In my older years I’ve reverted to being against density for lower prices, but for it’s positive effects on livability. There are limits though and it seems an area FSR of ~3.0 is about the upper-limit for ideal livability.
If Vancouver could make the rest of it’s city proper as dense as the West End was 30yrs ago, we’d all be much better off then trying to increase density further there and the rest of the core.
It’s a political problem, not a math problem. The City (whatever the governing party) prioritizes its policies to favour increasing property values, which, although may be good for developers and filling city coffers with more & more property taxes, it’s not healthy for the economy, the culture, & the people who live here. That’s why all the evidence so far is that the upcoming election will be fought over chickens, bike lanes, riots, wheat fields, etc, ie, everything but the bloated property values that make Vancouver unaffordable for regular people & stifles so much of the economic activity that could go on if such a large portion of our incomes weren’t going to the lords of the land.
The City Government is a reflection of the people who make up our city.
I can’t believe I managed to type that with a straight face. Let’s try again:
The City Government is a blurry reflection of the people who bother to vote.
A large majority of the voters in Vancouver have a vested interest in preserving property values and vote accordingly. For the elected officials, they get virtually no real benefit to their re-elections for actually doing something on the affordable housing file, but they do get rewarded for spouting mealy mouthed platitudes on the subject.
It would be really nice if we could just blame the politicos for this one and tell ourselves that their just in the pockets of developers distracting the well meaning masses with pointless debates.
It doesn’t work that way.
No elected Government is ever a perfect reflection of the wants and desires of the electorate and one of the problems in Vancouver is the cozy relationship between the City and developers.
But it wasn’t a developer or a politico or some big land owner that tried to get me to sign a petition against new development in the name of affordable housing. It was an ordinary citizen who believed that what she was doing was the right thing for herself and for her neighbourhood and for her city.
Part of the solution to this problem is going to be convincing a lot of people to vote against their own immediate interests (rapidly increasing property values) in favour of policies for affordable housing. That means convincing them on the merits of their long term interests (improved livability, economic stability, etc) and coming up with creative ways to implement these policies, so as to reduce their impact on the voters.
We can’t just wash our hands and say the system is corrupt. We all are a part of the system.
Again, it’s not just a math problem. Why is the controversy over density about already dense neighbourhoods such as the West End? Why are the ones about social housing typically in regards to the Downtown Eastside? All this while places like Shaughnessy coast along as is, ie, unaffordable & with low density. Are Shaughnessians anti-development because of this? Of course not, as I’m certain it’s home to more than one developer; it’s just not the area they are interested in developing.
The argument that the whole affordable housing issue all comes down to density is deeply flawed because it assumes supply & demand are neutral forces, which they are not. Supply & demand can be & often are created and/or manipulated in certain places and at certain times. This “any development is good development” line makes it easy to paint critics of any particular development as some kind of backwards thinking anti-development nutbar, no matter how ill conceived or destructive to an existing community it may be. You’re either with us or against us. Too bad it doesn’t explain, among many other things, how the biggest increase in residential developments downtown coincided with the rise of the homelessness crisis.
I believe there is an unfair characterization going on of residents of the West End opposed to development and densification. It is often painted that opposition to development is mainly by owners living next to a development proposal exhibiting a standard form of NIMBYism at fear of change next door.
I’m an 8 year renter in the West End and will continue to be for the foreseeable future. I find it a great place to live for many reasons.
It is a shame to see the density debate always reduced to quantitative and oversimplified terms. Most often it’s always talked about in numerical binary terms “supply and demand”, when the reality is much more complex. How about the quality of density?
If the numbers were a simple answer wouldn’t the dense neighbourhoods of Yaletown and Coal Harbour be affordable? And what is the quality of the density in those neighbourhoods? People I know who have rented in those neighbourhoods drive (or transit) to a West End safeway or other grocer because Urban Fare is out of their price range after paying Yaletown and Coal Harbour rental or mortgage prices.
It is a statistical race to stem demand with more housing supply in Vancouver, but both qualitative and quantitative aspects are glanced over in that race:
1. affordability: how is it defined and how can you call it that if it’s what the market will bear and has no guarantee of decreasing prices in the neighbourhood? http://thetyee.ca/Views/2008/02/29/EcoDensity/
2. context: The West End already has the city’s highest density, yet a high proportion of STIR proposals exist here. What about single family housing neighbourhoods and the least dense neighbourhoods? http://thetyee.ca/Views/2008/02/29/EcoDensity/
3. history: in the race, heritage designated landmarks are being torn down or turned into a facadist architectural amenity for the brand of the building that the developer wants to sell. Yaletown and Coal harbour didn’t have a community opposition to this because they were vacant industrial land.
4. community: this is a big one.
a) The STIR units wave developer costs that would directly contribute to quality of the community and amenity improvements that WOULD happen if these developments weren’t under STIR
b) families? I want to raise one here. The rental units proposed at many STIR developments are less than 400 square feet! Anyone who rents in the West End will tell you finding a two bedroom is a difficult feat. Does shoehorning a bunch of shoeboxes in with the condos contribute to the quality of the community residents want to have? Or just the quantity of residents it can have?
And on and on…
But in the race to take care of the quantitative the qualitative things that concern the community are being overlooked.
Another aspect of affordability. Taxation. Would any municipal politician be willing to propose raising taxes on investment and speculative properties and using that money to directly subsidize other housing? I doubt it.
Happy to see Shaugnessy get some mention. That is a neighbourhood that has its own, special zoning, unique to it and created specifically to limit any new development and to increase property values as much as possible. Yet this is a neighbourhood that’s maybe a 10-minute bike into downtown, similar on transit. If there’s anywhere that could use an increase in density, it’s areas like that.
Yes, increase in supply can help keep housing more affordable, to an extent. But it doesn’t work if the new supply replaces existing affordable housing – in that case, the opposite happens, gentrification takes place and housing increases. And this is usually the type of densification that occurs, because that’s where the biggest profits can be made, where you take a run-down, low-value property and turn it into a very high-value, upper class property and in the process evict all the tenants.
This is what’s happening in some of the East Van neighbourhoods now, including Mount Pleasant, and it’s creating an interesting dynamic. You’ll notice in the 2006 census that the population of Mount Pleasant actually decreased despite an increase in the number of units. This might sound perplexing, but it makes sense when you consider domestic change: richer people can afford more space, and so there’s fewer people per unit, meaning less people density with gentrification and so-called “densification.” That’s an important piece to also consider with densification.
You also have to keep in mind the cost of construction. A lower density rental building built without parking will be cheaper than a higher-density condo with underground parking. Many of the municipality’s own bylaws serve to increase the cost of housing unnecessarily and for marginal if any benefit. Most houses don’t have sprinklers, for instance, yet laneway houses are required to have them. Yes, that might save a life every few years in a fire, but I have to wonder what the human health impacts of hundreds more people living paycheque to paycheque are. Stress certainly has an impact on health and life expectancy.
If we want to see real densification, then the best place to achieve that is in single-family neighbourhoods that are currently used as single-family, not areas with high percentages of rental housing or apartment buildings. Unfortunately, that’s not the path of least political resistence.
But the point is: New development does not necessarily mean lower costs. It depends on the type of development and what it’s replacing.
correction: gentrification takes place and housing *cost* increases is what i meant to say.
“What will be the toughest issue in the upcoming civic election?” asks Mr. Price, knowledgeably, as he conveniently provides the answer . . .” Housing, of course. Affordable housing in particular”.
I don’t know why the “of course”.
Ummmm, it’s a bit more complicated than that Gordon! In realistic circles it’s called a Ponzi!
http://this.org/blog/2009/09/01/buy-or-rent-real-estate-ponzi-scheme/
“ They overlook the interest payments they make to their bank on their mortgage, which on the overleveraged, lowest-payment-possible loan that has become so popular these days often exceed the value of the home itself. That’s not all, either, as there are the thousands of dollars that home owners must spend each year on property taxes, insurance, condo fees, and regular maintenance, costs of home ownership that routinely get overlooked by over-anxious buyers.”
The American dream, a home of one’s own, has also been the Canadian dream: indeed that dream (an Englishman’s home is his castle) seems to have been pretty well universal, in the Anglo world since WWll anyway.
But somehow the dream seems to have gone awry . . .
. . . even in Canada and especially Vancouver . . .
I haven’t owned a home since 1984 but I’ve had the freedom to do some wonderful travelling with a nice little nest egg that keeps the wolf from my door!
I used to live in Shaughnessy, albeit in a rental unit. I can attest that the yard was huge, as was the house, but my rental was small. I had to share a bathroom, a most unpleasant experience even though there was hex tile with cool inlaid patterns on the floor and a six-foot tub with an array of shiny pipes and rubbed nickel knobs. I was driven out by the party animals upstairs who were bartenders at the old Luv Affair.
How ironic that I was driven from a Shaughnessy mansion into Mt Pleasant social housing.
I’d guess a massive real estate collapse in China, which may be getting underway now, will have more to do with lowering housing prices in Vancouver than any upzoning.