B.C. angst is real estate, or lack of it
A victim of its own success, with low affordability
Tin Vancouver his is an attractive city, just “mind-numbingly boring,” says a pseudonymous blogger at The Economist. Not enough grime nor grit, gripes the magazine’s online “Gulliver,” whose underworldly view of life seems undermined by ignorance: He knows nothing of Vancouver’s sordid underbelly, poor chap.
Are we bored? We wish. We’re in perpetual crisis mode out here, always at the boiling point. We burn with envy and rage, despair and regret, every day and every time we open a newspaper and read the latest accounts. Our angst is real estate, or lack of it. The shocking lack of living space. Horrifying house prices. Densification, and opportunities missed.
We are consumed by this, more than others might understand or appreciate.
Vancouver’s living situation is uniquely nuts. It’s among the least affordable cities in the world, based on housing price and wage comparisons. Salaries here are middling, with annual household incomes averaging about $70,000. Yet the median price for a single family home has just reached $1.6 million. Do the math and try to meet those mortgage payments, even at today’s low interest rates. Most can’t.
You might attempt to raise a family inside an “affordable” downtown condo box, at $600,000 plus monthly fees, and 800 square feet. Good luck with that; you’ ll need to find some extra storage space for rent. Oh, and sell the car, because you can’t afford one here, thanks to Vancouver’s extra special gasoline taxes, and premiums placed on parking space.
There’s not much relief for those who bought their homes decades ago and have worked hard to pay things off. There’s now chatter about housing control measures and new levies, including a scary-sounding “luxury housing” tax, which Mayor Gregor Robertson advocated in a letter written last month to B.C. Premier Christy Clark.
Robertson “suggests the province legislate a property transfer tax for the city’s most expensive properties, with proceeds going to a housing affordability fund,” according to Thursday’s Vancouver Sun. The mayor left for others to consider what sort of home might qualify. Presumably, it would not cover the modest Kitsilano house he and his now-estranged wife bought in 2013 for $1.58 million, and sold last month for a $1.98 million.
The mayor also mentions in his letter a preference “to discourage the quick resale or flipping of new houses” and to ensure that buyers don’ t allow their properties to sit empty, as some are supposedly prone to do. The point is to “help moderate the excesses of the Vancouver housing market,” writes the mayor. Laudable, perhaps, but details are scant.
The mayor seems influenced by Bob Rennie, a local marketer of condominiums and an urban densification advocate. Vancouver’s unabashed “Condo King” wields considerable clout in municipal politics, so there might be no coincidence that a speech Rennie delivered last month coincided with Robertson’s letter to the premier.
“I suggest we look at a declining tax that sees a percentage of profits taxed if a home is sold — whether it’s three months, whether it’s six months, or if it’s sold within 18 months,” Rennie told an audience.
“If speculation is a huge negative contributor to affordability, then let’s repatriate some of the money back to our first-time buyers,” in the form of grants.
According to the Georgia Straight newspaper, Rennie went further, noting that “perhaps these grants should only go to people who can prove that they don’t have parents sitting on huge amounts of real-estate equity, which could be used to finance a future down payment.”
We can see it now: pinched-faced inspectors confronting suspected parents, demanding to see their family photo albums and balance sheets.
Others have suggested special taxes and other measures to block non-residents and even immigrants from buying Vancouver properties, as if that would surely shrink the affordability gap. Again, details are sketchy. A formal study or inquiry seems in order, at least to determine the extent to which foreign, nonresident activity impacts the housing market.
As it is, Vancouver is a victim of its own success: people want to live in a place without a lot of housing stock, with nowhere to grow but up. There’s one small positive to take from this: the city has become a leader in the design of minuscule living space.
At the University of British Columbia, officials are considering whether to build a proposed residential block consisting of 43 new selfcontained apartments, each one just 145 square feet, or the size of a parking stall. These would rent for less than $700 a month, to some a bargain rate.
Forget the backyard, the balcony, the toilet that doesn’t sit next to the kitchen sink. Those so-called micro-lofts? Extravagance. We are developing the nano-hut. Such is our lot.
Mayor suggests a property transfer tax for most costly properties