YAFFE: CITY LOOKS TO DISMANTLE LAND ASSEMBLY
Housing: Planning director explains need to ‘discourage’ the parcelling off of residences
If you happen to own a detached house on a busy street in Vancouver, you might be inclined to get friendly with your neighbours in the hopes that it could pay off, big time.
Land assembly has become all the rage in this city, with realtors and groups of homeowners luring developers to purchase groupings of residences along arterial roads. Trouble is, the city is being extremely selective about which land parcels it is prepared to rezone.
On Wednesday, planning director Brian Jackson issued a warning to the home sellers and realtors who are jumping on the land-assembly bandwagon to cool it.
Jackson’s message: Just because homeowners or realtors assemble a parcel of land, it does not mean the city will approve a higher density for that parcel.
Developers, of course, seek out higher densities to maximize profits. Rezoning gives them leeway to offer groups of homeowners double, even triple, the price their properties would fetch as individual units, as my colleague Joanne Lee-Young reports elsewhere in today’s paper.
Jackson says the land assembly activity that has been accelerating amounts to property speculation. “It treats housing as a commodity as opposed to a place where people live. We want to discourage that,” he says.
The activity is likely the result of an interim zoning policy adopted by the city three years ago, aimed at encouraging affordable housing development along Vancouver’s arterial streets.
But unless a developer brings the city a redevelopment proposal that offers housing that is truly affordable, Jackson says the city will reject the rezoning applications.
Also, if the land parcel includes character or heritage style homes, rezoning chances are slim.
Jackson says two to three proposals for rezoning land assembly parcels are coming to the city monthly, compared to five years ago when no proposals, or perhaps one a month, would be pitched.
Matthew Pulakkavil, a homeowner on Knight Street, says he recently heard about land assembly projects selling at three times assessed values due to their rezoning potential.
Pulakkavil, who bought his home for $430,000 a decade ago, “spoke to all the neighbours around me, many of whom have owned the houses for many years, and are very happy with their homes,” he says. “But we all agreed we could afford to move if we got an offer close to what we are asking.”
Pulakkavil and four of his neighbours figure their homes, on 45-foot-wide lots, would normally each be worth $1 million. With their group offering, they are asking $2.5 million per property.
“We’re looking for a developer who knows exactly what they are doing, or an investment fund that doesn’t mind buying and holding,” he says.
They contend the site would be ideal for a 22- to 26-unit townhouse development. The homeowners are working without an agent, to save on realty fees.
Ironically, these Knight Street houses contain rental accommodations, affordable units that would disappear if a developer were to get rezoning approval and razed them.
Michelle Yu probably is the most prominent Vancouver Realtor working on land assembly projects. Her name appears on For Sale signs on entire blocks along Granville and Oak streets.
At the moment, Yu has on her website 13 available land parcels, one as large as 11 lots, all on arterial routes such as King Edward Avenue, and Oak and Granville streets. She specifies: “Lots must be purchased together as a package.”
The Oak Street parcel features 11 lots — each measuring a shade under 50 feet wide — which are pegged at more than $3 million each, for a total price of $34.2 million.
Jackson says he is aware of Yu’s land assemblies but says she cannot offer any assurance the land being offered will be rezoned, now or in the future, given that some developers are banking land in hope of policy changes by the city.
But even the planning director’s sobering words may not diminish the rush to assemble land in Vancouver. Money is a powerful lure.