Be bold
Boosting the stock of affordable housing in Vancouver faces twin hurdles in the form of public resistance to greater density and civic policies that some say lack boldness.
Reporting recently on efforts to follow through on last year’s Mayor’s Task Force on Housing Affordability, Abigail Bond, assistant director of housing policy for the city, told Vancouver’s urban design panel that neighbourhoods are not keen to cut street width to free land for new housing.
The “thin streets” idea was a winning entry in the city’s re:Think Housing competition last year, with Christina DeMarco, Ted Sebastian and Charles Dobson arguing that converting underused streets across the city could yield 10,000 residential building lots.
However, it’s been unpopular in practice.
“We haven’t had a community yet that’s been interested in pursuing it,” Bond said. “If communities are not interested in opting in then it’s not something we’re going to pursue.”
Panel members, however, were more interested in whether the overall ambitions for boosting the stock of affordable housing in the city are realistic.
Vancouver aims to add 18,600 units of affordable housing to the city by 2021. Options include new rental housing and units that can be bought for at least 20% less than current market prices. Construction is encouraged in specific areas that mesh with the city’s transit and jobs strategies.
But when Bond and assistant director of development Doug Robinson were finished speaking, panel member and architect Peter Wreglesworth argued that the city’s vision for developing new affordable housing is at odds with the gravity of the issue it seeks to address.
“It feels like it’s too timid,” Wreglesworth said.
Any new affordable units have to catch up to current needs and keep pace with anticipated future demand. With the city’s population (including the UBC campus) set to approach 775,000 by 2041, Wreglesworth believes more is needed.
Panellist and engineer Goran Ostojic echoed Wreglesworth’s comments and questioned just how many units could be built given the guidelines for new developments and the length of city approval processes. He feared current policies would result in far fewer than what the city hopes.
Summarizing the comments for the record, panellist Veronica Gillies aptly remarked: “We need to increase the toolkit. It isn’t realistic in terms of the actual numbers you want.”
Rental squeezed
Vancouver might have the least affordable housing in the country, but recent figures suggest housing costs in the province have dropped.
BC Statistics reports that shelter costs in the province “continued to fall” this spring – but this was driven largely by a decline in the cost of owned accommodation rather than rental apartments.
Costs dropped 0.9% in May 2013 versus May 2012, driven by a 2.2% decline in owned accommodation. The decline was offset by a 1.2% increase in rents. The shift is borne out by Canada Mortgage and Housing Corp.’s latest survey of rental markets.
The average monthly rent in Vancouver increased to $1,052 in April 2013, an increase of 3.85% over April 2012. Bachelor and three-bedroom units drove the gains, with rents increasing 4.2% and 4.6%, respectively.
The gains happened despite an increase in average vacancies in centres of 10,000 people or more was 3.5%, up slightly from 3.4% a year ago. In Vancouver, vacancies averaged 2.9% in April, up from 2.6% a year earlier.
“It’s still at an unhealthy rate in Vancouver,” Bond said in a recent presentation to the city’s urban design panel.
On pause
Higher rents in the face of higher vacancies should be somewhat encouraging for investors looking at Vancouver’s multi-family market, but the latest numbers from David and Mark Goodman suggest “buyer resistance” has set in. Fewer apartment buildings have changed hands this year in Greater Vancouver, with 45 sales to the end of June versus 53 in 2012’s first six months. The dollar value was also down. Aggregate sales volumes for the period totalled $240.9 million versus $417.5 million last year.
But, according to the Goodmans’ report, sellers are being patient, holding on to assets until the right deal comes along. While fewer sales have happened, average per-suite prices across the region increased 8% to $226,082 for sales in the first six months of this year.
The sales tally for the year should approach 87, the Goodmans forecast, with an aggregate volume of $500 million. •
