Most Recent Comments:
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- tedeastside on “Vancouver isn’t vibrant or exciting, it’s as dead as a doornail. It isn’t a big city, a world class city or even really a city. It’s a large sleepy tourist village that wishes it matters on the world stage.”
- brandr.rasmussen on Vancouverite On Vancouver – ‘Neighbourless Neighbourhoods’, ‘Ficto-Finance’, ‘Soulless Tourist Town’
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- Gina on “No problemo. 69 per cent of the condo tower is pretty stable.”
Type of Anecdote
- 01. He Said, She Said (248)
- 02. Profiting from the Boom (445)
- 03. Changed my Life (106)
- 04. Changed my Career (39)
- 05. Where do Buyers get the money? (969)
- 06. Held my Nose and Leapt (97)
- 07. Avoiding Vancouver (376)
- 08. Overextended Buyers (1194)
- 09. Delaying Buying (316)
- 10. Demoralized Renters? (366)
- 11. Regrets about Investing in RE (417)
- 12. Effects of Development (276)
- 13. 2010 Olympics Related (74)
- 14. Social Effects of the Boom (1261)
- 15. Misallocation of Resources (964)
- 16. Missed The Boat? (236)
- 17. The Froogle Scott Chronicles (27)
- 18. Spot The Speculator (171)
- 19. BlastRadiusPostCards (17)
- 20. The Limitless Demand Argument For Ongoing Market Strength (70)
- 21. Vancouver RE-Verse [Found Poems] (8)
- 22. RE References In Popular Culture (42)
- 23. Jumping The Shark (1)
- 24. Policies On Housing (10)
- 25. Epigrams For The Bubble (1)
- 26. Premature Calls Of "Bottom" (3)
- 27. Seller Panic (3)
- 28. Erroneous Causation Theories For Falling Prices (7)
- 29. Bubblespeak (1)
- Uncategorized (176)
- “No problemo. 69 per cent of the condo tower is pretty stable.”
- Still Dead
- BC Premier: “I think the market’s good, it’s a buyers market. I want to make sure I get in before prices start to rise.”
- “You’ll have to pry my cell-phone from my cold, dead hand….” [Off-topic, but irresistible]
- Mayor Robertson Selling His House
- “Nothing Wrong Here!”
- “We spoke to a friend of ours yesterday. Even though she has purchased a house, she wants to keep (and rent out) the condo she’s living in, because she thinks prices will only go up.”
- Families With Children Leave Vancouver – “We bought a townhouse in Port Moody in 2006, sold it in 2011 and bought a house. We couldn’t have done that in Vancouver. Absolutely not.”
- The Economist on Land Taxes – “Taxes on immovable property are the most growth-friendly of all major taxes.”
- “It’s kinda funny that 3 unrelated Irish blokes all said that this mess in Vancouver/Canada RE is unfolding EXACTLY like the mess did in Ireland, one headline at a time.”
- “I was really fortunate with how things worked out for me in real estate. I definitely took chances when I bought a few presale condos to flip back in 2004, but I was adamant at the time that there was room to grow for Vancouver.”
- Making Sense Of It All
- “I have been contacted by two of my realtor friends in the past week both proclaiming that the market is turning and that this is a good time to buy.”
- Trump on Vancouver – “Your people, they go to New York, they go all over the world, and they speak so highly.”
- ‘Canadians obsessed with real estate, poll suggests’ – “Just as many people reported talking about real estate on a regular basis as they did about hockey.”
- ‘Doomed’? – “Home prices in Canada are now double what they were in the 1970s in real terms. Historically, over the very long term, real home prices tend to be flat.”
- “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- “Let’s remember how we got here” – Looser and Looser CMHC Limits
- Don’t Worry, I’m Sure Somebody Will Sort This All Out – “Policymakers now know better and will be a lot more proactive in preventing a collapse.”
- “Things have changed, we are not doing that type of mortgage. We are not interested at all.”
- “We are noticing our target type of housing in price decline, albeit slow, as our money increases in value, slowly as well but outpacing housing.”
- Renter Buys In West Van – “For a few hundred more per month, you could own the place. Which is what I will be doing as my offer for a place down the street has been accepted. There is some value in staying in one place.”
- A Bed in the Bathroom, Why Not? [Let Us Count The Reasons...]
- “My husband and kids are pretty happy in our rental house within cycling distance of work that we could never have afforded otherwise. We’re doin’ pretty dang well, thank you, for median income earners in this expensive city.”
- “I Wish Them Bad Luck.” – Jim Flaherty, on those who wish to profit from Canadian RE price drops
- “We asked why he doesn’t just rent the whole house. He said he can’t, it wouldn’t cover his mortgage – he’ll get more to rent it out as two suites. These new landlords are hilarious, thinking that rent will cover their mortgage!”
- “My neighbours, in their late 60s, just put their house on the market. They had said they would die in that house, but now they are worried that with the housing market going south they may be losing a lot of equity and they better sell now before it gets worse.”
- Chat Thread
- Taking A Break
- “My best guess: this property is now an ‘investment hold’ and will be built ‘when prices recover’. Good luck on that!”
- Man Loses $745,000 Vancouver Condo Deposit
- Graphic – Degrees of Housing Overvaluation in Canada
- The Rare Individual With A Negative Ownership Premium
- Advice Regarding Renting In Vancouver, Please – “Unfortunately, the Vancouver rental stock is absolutely atrocious. It just seems like every landlord is looking for someone to pay 100% of their mortgage on a crappy place through rental income.”
- “I just visited Manhattan for a week, and happened to snap some real estate ads on both the Upper West and Upper East sides of the island. Compare to Vancouver. It simply doesn’t compute.”
- Ben Rabidoux In Vancouver Next Week
- “The mortgage company told me they were calling in my 40-year, 0-down mortgage. I have paid nearly sixty thousand dollars towards it, but, nearly five years in, I have yet to touch the principal.”
- ‘Vancouver City Hall: Housing Report Card 2012′; Plus Revised Version
- “My folks find themselves at 65 still owing half the value of their home and recreation property to the bank. After almost 30 years of ownership in the BPOE and a number of boom markets, they have very little to show for it.”
- “Rent for $2,200 a month or buy and have a mortgage of $4,310 per month. Why would anyone buy?”
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Category Archives: 12. Effects of Development
“My best guess: this property is now an ‘investment hold’ and will be built ‘when prices recover’. Good luck on that!”
“The dominos start to fall: SFR Project on indefinite hold in Van West!
This is a property I have been watching for some time: 4988 Chancellor Boulevard in University, Vancouver West. A 7,700 square foot lot with an old house in an exclusive area of mostly older homes, with a few new builds. Sold under MLS V951758 in June 2012 for about $2,600,000 listing was at $2,688,000; by June 2012, properties in Van West were already coming under some price pressure. After it was sold, a sign appeared on the site, advertising a new 4,500 square foot modern architectural home to be ‘built in 2013′ with completion by 2014, priced at $5,188,000 under V989612 still active, but listing now says ‘completion in 18-24 months’. However, after about 6 weeks the sign disappeared and from June 2012 through last week the house was vacant and there were no signs of construction. Then last week April 10, several large U-Haul trucks arrived and a pickup toting a boat. Now, there is furniture in the house, a new ‘beware of dog’ sign on the front and from the shoes outside the front door, it appears it has been rented to a family plates on vehicles are BC. Normally, a family doesn’t move lock, stock and barrel into a house on a month-to-month tenancy, so I’m guessing they have a longer lease, but I cannot find a rental listing. The developer of the new house, Natural Balance Premium Home Builders, does not list this house on its website and the purported architect, Frits de Vries’, website does not mention this project.
My best guess: this property is now an ‘investment hold’ and will be built ‘when the prices recover.’Good luck on that!”
- RFM at VCI, April 15th, 2013 at 7:37am
Sturdy, With Views – “Calling Froogle Scott!… Is Dr. Scott ‘In The House’?” [Not In This One, Certainly]
Poster ‘DNAspark99′, [on the forum bcsportsbikes, 22 Mar 2013 and onwards; hat-tip RE Lurker] has posted images of a ‘building’ that is under construction, with this commentary: “So, my landlord has taken it upon himself to build a ‘toolshed’. For a roto-tiller. At least, that’s the entirety of what he told us – there are, however, some inherent communication issues. (He’s Korean, and not yet well versed in English (though certainly much better than my Korean)). There’s one door so far, and a lawnmower will not even fit through it. (I don’t think he knows that yet though)
So, this is the ‘project’ thus far. For one, the ground it’s being built is mushy moist marshland – your feet sink with every step. Which is always ideal for a good foundation – or complete lack thereof.
It may not be immediately obvious, but I don’t think this man has a background in construction.
It appears he owns a hammer and saw, perhaps a measuring tape, perhaps not. Certainly nothing like a square, straightedge, or level.
I guestimate that he has seen no more than 3 episodes of various home improvement shows, and maybe at best he’s driven by a construction site atleast once in his life. After all, “How hard could it be?”
And now, in time-lapse video:
A second time-lapse video [posted 2 Apr 2013], worth the watch for casual efficiency, for the horse, for the stuff falling off the roof, and for the paint-job:
“Rogers Communications is expanding into RE; aiming to relaunch website; providing critical data that can help potential buyers assess the value of a property from the comfort of their home computer.”
“Rogers Communications is expanding into the real estate business.
The mobile and cable giant has applied to become a licensed real estate brokerage right across Canada and is aiming to relaunch its five-year-old website Zoocasa.com in May as a unique, one-stop-shopping site for homebuyers.
It’s aimed at going far beyond U.S.-based property listing services such as Zillow and Trulia which have revolutionized house hunting south of the border by providing critical data that can help potential buyers assess the value of a property from the comfort of their home computer.
… The rebuilt Zoocasa site will have “the most complete list of property information that can be provided to consumers, including neighbourhood and related information,” said real estate maverick Lawrence Dale who quietly folded his Realtysellers private sales online listings site a few months ago and started working with Rogers as Group Head, Real Estate Business.”
- from ‘Rogers to step into the real estate business’, thestar.com, 25 Mar 2013
We welcome any moves that result in availability of data regarding for-sale properties.
A Zillow-like system in Canada would represent a great improvement.
“There are up to 40,000 illegal suites in the city of Surrey — nearly double the 20,000 previously reported.”
“The appraiser stands at the foot of the empty lot, asked to assess its value — as if the home to be is already built.
He comes armed with floor plans sent to the city for approval.
In his eight years on the job in Surrey, he’s now seen thousands just like this.
The plans show an outlying deck and a basement with rec rooms, kids rooms, sewing rooms — “all these rooms that make no sense,” he tells The Province.
He is then handed another set of floor plans, either by the builder or homeowner.
“The revised floor plan? They show secondary suites going in,” says the appraiser, who estimates there are up to 40,000 illegal suites in the city — nearly double the 20,000 previously reported.
“The day (homeowners) get their final occupancy, the day it’s done — they enclose the rear patio and now you’ve just added another 1,000 square metres to your house.”
Not only are thousands of Surrey’s homeowners collecting undeclared income, he says, they are also saving on taxes when the suites are popped into place after city approval.
The owner of an in-demand design firm in Surrey says he’s aware of the illegal suite issue, but insists his company creates plans in accordance with zoning requirements.
“We discuss with the homeowners/ home builders as to their requirements and then prepare house plans,” he said.
“Our design company plays no role during or in the construction of the homes.”
“Of the nearly 4,000 residences developed in Surrey in 2012, 1,500 were single family units, namely in Newton and South Surrey.
The city issued permits for 427 secondary suites at 67 coach houses in 2012.
Surrey’s manager of bylaw enforcement, Jas Rehal, says his staff and the city’s building department communicate their bylaws and policies to developers.
“Generally, they’re abiding,” he said.
“These suites in Surrey, they’re all over the city,’ said Rehal. “When brought to our attention, we go out there, state the fee … once a suite is identified, we start billing.”
Annual fees for a secondary suite range between $500 and $1,300, which includes infrastructure costs such as garbage pickup and water use.
It can cost a homeowner up to $10,000 to properly outfit a home with separate piping, wiring and a firewall to make a suite legal.”
Jesse (YVRHousing) calls these suites ‘townhouses rotated 90 degrees’, and we think that’s spot on.
They are products of high prices: owners build and manage them to allow themselves to over-reach on price in the hope of further price increases.
This is an inefficient, clumsy and ugly way for a city to increase density.
‘Vancouver Is Awesome’ “Community-Based Social-Venture” Blog Actually A Stealth Paid Promoter Of Olympic Village
Above from a 12 Feb 2013 post on the ‘Vancouver Is Awesome’ site
“Marketers of the in-receivership Olympic Village are paying the editor of well-known local culture webzine VancouverIsAwesome.com to blog about the joys of life in the village – but it does not say on the website that he is being paid to do so.
Rennie Marketing Systems awarded the deal after receiving a single pitch from VancouverIsAwesome.com editor Bob Kronbauer, who says feels like he won a contest to be paid to flog the Village in False Creek – much like the public contests held by Vancouver International Airport and Tourism Richmond to find paid bloggers to promote them.
“I was visiting the Village a lot as a resident of Mount Pleasant before we moved in and fell in love with it and wanted to share the stories of all the positive things that make it great,” Kronbauer said.
“Beyond the budget and all this stuff I really have no idea about as an average citizen, (I wanted) to sort of expose stories about what it’s like to actually live there.”
Kronbauer lives in a market rental unit at the $1.1 billion complex, marketed by Rennie Marketing Systems, but declined to disclose his rental rate. He began a $2,475 per-month, six-month contract in May 2012 that was renewed in November. The year-long gig is worth a total $29,700.
“Beyond this, beyond my contract to promote the Village, we’ll be staying there in our suite because we love it so much, that was the intention to move there,” Kronbauer said.”
- from ‘Life in the Village pays off for local webzine editor’, Bob Mackin, Business in Vancouver, 14 Feb 2013
Elsewhere in the same BIV edition, Glen Korstrom suggests this is part of a broader trend of media manipulation by the real estate industry:
“Such tactics seem to be part of a trend of real-estate marketers manipulating media perception to sell condos.
Business in Vancouver has learned that VancouverIsAwesome.com editor Bob Kronbauer is being paid by the in-receivership Village on False Creek, formerly the Olympic Village, to promote life in the village – even though nowhere on his website does it make it clear that he is being paid to do so.”
“Vancouver Is Awesome, and we are dedicated to everything that makes it that way.
A community-based social venture sharing positive stories of arts, culture, lifestyle, and everything awesome about Vancouver. No bad news.
If you want to read ugly, bad news about this beautiful city of ours, you’re going to have to look to traditional media and other blogs; V.I.A. promotes everything that makes our city awesome, from old to new and everything inbetween. We’re like the human interest piece on the news… only different.”
We’ve previously tried reading the V.I.A. blog, but each time we break out in a terrible rash and can’t continue.
Advertising is irritating enough when it’s clearly advertising; when it’s in a stealth ‘product-placement’ form, far more so. And the ‘trend’ of media manipulation by the Vancouver RE industry is something that has been going on for years, it’s only coming to light now because the current state of the market makes people ‘ripe’ for the realization.
For the record, we ourselves aren’t paid anything, by anybody, for anything we archive, post, or say on this blog; it’s a labour of love and morbid fascination. We actually pay a small fee to wordpress each year to keep ads off the blog.
When news is “bad”, we call it “bad”; when something is “ugly”, we call it “ugly”; and that’s precisely how the RE market here looks to us right now – ugly.
A grand spectacle is playing out in our town, and we’re keeping notes.
If you are interested in developing your own ideas about the truth of the Vancouver RE market, and whether it is ugly or otherwise, read as broadly as you can about the market. If you don’t already do so, make sure you also consider the opinions expressed in posts and discussion on the following sites:
Vancouver Condo Info
Whispers From The Village On The Edge Of The Rain Forest
Vancouver Price Drop
Vancouver RE And Then Some
The Economic Analyst
and, of course,
Vancouver Real Estate Anecdote Archive
“J.J. Miller and his brother William made their fortunes in real estate, and built giant houses in East Vancouver in 1908. They then lost everything in the crash of 1913.”
“It’s a natural that the conversion of big old mansions into multiple-unit housing can boost density and protect our heritage in the process.
As one of Vancouver’s developers found out the hard way, one of the biggest sticking points is if the neighbourhood will allow it.
Developer James Evans and architect Timothy Ankenman, who are old friends, are also responsible for two recent conversions: one in the hotbed of community activism, Commercial Drive, and the other in the polar opposite prestigious hood that is Kerrisdale.
Anybody who’s lived around Commercial knows the Jeffs Residence at 1240 Salsbury Dr. It’s a hulking three-and-a-half-storey, 1907 house that’s provided rental housing to the area since the 1920s. It was built as both residence and doctor’s office for Dr. Thomas Jeffs and his wife Minnie and their kids. The popular doctor, also a city council alderman and police commissioner, moved out of the house shortly before he died in 1923. It may be considered an old working-class neighbourhood now, but in the early part of the 20th century the Commercial Drive area was a rich person’s enclave, and the Jeffs Residence was surrounded by many other Queen Anne Revival grand houses with turrets, pitched pyramid roofs and hipped dormers.
Mr. Evans lives about a block away, so he’d walk by the house all the time and think about restoring it. One day, he contacted the owner.
“We put together a deal and went through a rather painful approvals process, ended up buying the site, and here we are today,” says Mr. Evans, standing on the job site.
The painful process he is referring to is community reaction against the loss of rental stock.
“It’s a pretty reactionary neighbourhood with anything that smells like development, so here I am, getting launched in the middle of the thing,” he says, sounding dismayed at the memory. “A lot of people in the neighbourhood know who I am, and so I was walking around the neighbourhood with a bull’s-eye on my back over the course of the year I went through it.
“Loss of rental continues to be a sensitive issue,” he adds. “And I looked into trying to use this as rental and I figured the only way I could do it was to spend $1-million on the site, which would have bumped everybody’s rents by about 30 per cent, and that’s not affordable housing anymore.”
Instead, he and Mr. Ankenman went through the process of getting the house added to the heritage registry in exchange for density and other variances. The result is a seven-unit house comprised of mostly two-bedroom units, except for the top unit, which will be one bedroom, with an amazing view from the turret. The price starts at $400,000 for a 750-square-foot condo, and Mr. Evans says he’s already pre-sold three of the units. It’s about two months away from completion.”
I ask him if he would do the Jeffs Residence project over again, having gone through a year under the hot spotlight of contention. He pauses.
“This one is unique,” he finally says. “There’s only one of these in Vancouver. And I’ll be able to walk past this thing in 10 years and it will look great and continue to look great, and I will get some personal satisfaction out of that.
“Will I make any money out of it? I don’t know yet. Time will tell.”
- from ‘Vancouver developers of heritage properties convert homes and hearts’, Kerry Gold, Globe and Mail, 10 Feb 2013
Thanks for the link to the above article goes to regular reader and commenter Aldus Huxtable, who adds:
“I used to live right by this development and have watched it for some time.
It’s a fun story we can watch play out over the next few years.
Down the block is J. J. Miller’s Kurrajong, a heritage house [photo below].
It’s also really important to read the heritage waymarker [see below].
J.J. Miller and his brother William made their fortunes in real estate, and built this giant house on Salsbury in 1908. They then lost everything in the crash of 1913.”
“Petitioned The City of Vancouver
The City of Vancouver: Stop a funeral home from moving into 450 W 2nd Ave!
Property owners in the neighbourhood are concerned that property values will be negatively affected and that the City of Vancouver failed to consider this before approving a change of use for the commercial property in question.
The City of Vancouver, Board of Variance
Stop a funeral home from moving into 450 W 2nd Avenue!
- posted at change.org approximately 6 Feb 2013 [hat-tip Aldus Huxtable]
Comments below the petition thread:
“Will negatively impact my property value” – Beth McNeil
“I am a resident of the adjacent condo building and I am concerned about the changes this funeral home will bring to our neighbourhood.” – Samantha Cuncliffe
“I am concerned about the impact the funeral home will have on the neighbourhood.” – Concerned Citizen
“impact of a funeral home on the neighbourhood, sales, and also the risk of health impacts caused by the funeral home.” – Laura MacCormack
“the parking!!. we have the police station right by us already. they already took up all the parking and parking anywhere they want . also the bike line just add in few months ago. there is already no parking for the owner and the visitor and for the business… that will effect our property value. so is that mean we allow to pay less tax.??…we pay tax for our community. we want to enjoy it. the funeral is right by the main traffic road. when they have a event. i cant imagine the impact for the location. they are on the route for Sunrun. and couple of the running event. is going be a nightmare.” – janet wong
“There is no reason to put a funeral home in such a thriving neighborhood. No one benefits from this, not even the funeral home because it’s a terrible location for one…no parking, police station operations that will likely disrupt any funeral services going on, frustrated neighbors who will not support them, etc etc.” – Emily Ng
Yes, we are all mortal.
And, while we’re dismantling ridiculous fantasies..
..our real estate is in a massive speculative bubble.
“I live in the new Wesbrook village on UBC campus and finally stopped by the Wesbrook Welcome Center. I wonder how long they will keep up this rate of construction?”
“I live in the new Wesbrook village on UBC campus and finally stopped by the Wesbrook Welcome Center. They have a map of all current and planned development, (captured here with my) camera phone. The grey ones have been approved but haven’t been started, apparently they should all be completed in 10-15 years. That’s a rate of .67 – 1 highrises and 2 – 3 lowrises a year. Since I moved in 6 months ago none of the show rooms or open houses have closed. I wonder how long they will keep up this rate of construction?”
- LazyCanadian at VCI 8 Feb 2013 12:24pm, image posted here.
“UBC has gotten totally out of control. I graduated there a couple years ago, and it was getting a little ridiculous with the amount of construction, but now it’s even worse. When I visited for the first time in 2005, it was beautiful and was one of the reasons I wanted to go there.
The whole campus is under construction now, and they’ve cut down massive parts on the endowment lands (a.k.a. woods) to build million dollar houses and condos (which is just what the generally poor students need).
Most of the open green spaces are now huge condo towers. You can barely walk across campus anymore, with all the detours. Some people recently hung up a bunch of signs. [see below]
Back in 2007 they permanently cancelled the annual big party students have on the last day of classes, because the people in their million dollar homes on campus didn’t like the students drunkenly walking through to the stadium. Apparently the realtors didn’t tell them that they lived on a campus…
Nothing against UBC, I loved the school when I went there, but now when I visit campus, I feel bad for the current students.”
- Andrew at VCI 8 Feb 2013 2:38pm
Guerilla signs protesting construction on UBC campus, images from blog post ‘Anonymous snarker channels construction anger into guerilla memes’, Ubyssey Social Club, 12 Oct 2012. Archived here for the chronological record:
‘The case for strata ownership of secondary suites’ – “It will reduce the number of rental apartments, but if it also reduces the number of renters by allowing some of them to buy, what’s the problem?”
“North Shore realtor Dave Watt and Vancouver developer and consultant Michael Geller, are independently and in different ways starting to push for changes to happen.
Watt has written to the three North Shore councils noting that, although secondary suites are well accepted, “these are the only form housing where our governing bodies mandate that the residents must remain tenants forever.
Geller, an architect, planner, consultant and developer who’s attempting to get City of Vancouver approval to practice what he preaches with a small new housing project, says the problem tends to be zoning law, not strata law.
He hopes to replace an existing single-family home just off West 4th in Point Grey with a duplex-plus project. Each half of his new duplex would have a high-end, 800-square-foot secondary suite, and the property would also have a coach house — a total of five homes in all. And each would be sold as a separate strata unit.
“It’s a way to gently increase density,” he told me. “And it would work especially well in what I call transition zones, just off major arteries in the buffer areas between them and single-family residential areas.” …
I guessing the main argument against moving in this direction will be that it will reduce the number of rental apartments on the market. And it may. But if it also reduces the number of renters by allowing some of them to buy, what’s the problem?
- text and image from ‘The case for strata ownership of secondary suites’, Don Cayo, Vancouver Sun, 30 Jan 2013
Basement Suite In East Vancouver Sells For $590K
VREAA 24 Feb 2012
Basement Suite In Vancouver Ask Price $900K – “Currently the garage is being used as an office and storage and is included in the square footage.”
VREAA 11 May 2012
Vested Interests Meet Over Hors d’Oeuvres – “Only the best booze and culinary treats were good enough, to ensure another year of rubber stamping developments.”
“This may be a little off topic, but I found out that the Richmond Developers were wining and dining Richmond City brass last Friday.
Only the best booze and culinary treats were good enough, to ensure another year of rubber stamping developments.”
- Real Estate Tsunami at VREAA 17 Dec 2012 10:36pm
Not off topic at all. A central thread to the whole speculative mania has been the confluence of the interests of all the different parties who benefited from the run up in prices.
Note that this is not to suggest any form of elaborate or sinister or illegal collaboration. It is simply to point out that many local entities together benefited from years of debt-fuelled RE spending: government and lenders; developers, realtors, owners; advertisers & media; retailers; all sorts of individuals & organizations that experienced short-term benefit from the immense amount of capital flow that resulted from buyers taking out large mortgages and spending the proceeds. It is completely natural that all of these parties would work together to perpetuate a situation from which they were all gaining short-term benefits. Humans are like that. This is why speculative manias burn so bright for a period; so many come together to fuel the flames of the same fire.
In view of yesterday’s spirited and informative discussion (thanks, all), we have withdrawn this morning’s teed-up anecdote and invite the continuation of yesterday’s discussion here today. [Here are a few comments from yesterday's thread]:
“There seem to be some misconceptions about the size and capacity of the ALR.
“The minimum amount of agricultural land necessary for sustainable food security, with a diversified diet similar to those of North America and Western Europe (hence including meat), is 0.5 of a hectare per person. This does not allow for any land degradation such as soil erosion, and it assumes adequate water supplies. Very few populous countries have more than an average of 0.25 of a hectare. It is realistic to suppose that the absolute minimum of arable land to support one person is a mere 0.07 of a hectare–and this assumes a largely vegetarian diet, no land degradation or water shortages, virtually no post-harvest waste, and farmers who know precisely when and how to plant, fertilize, irrigate, etc. [FAO, 1993]”
Total hectares of ALR in fraser valley: 132,760 in 2009 (stats canada) (less today)
132,760/0.07 = 1.9 million people. That’s how many the ALR can support, best case scenario. That’s for people fed a subsistence, almost vegan diet, where one crop failure means famine.
Keeping current diets up: 265,500 people. (That’s 0.26 million).
Current lower mainland population: 2.6 million.
While fishing adds to the total number of people, we are nevertheless completely dependent on food imports. Any food supply chain disruption is going to cause a slight… inconvenience to the normal process of cellular respiration. Worth keeping in mind when we look at the planned growth strategy for the region – was it 4 million by 2050?”
- The Poster Formerly Known As Anonymous
“Out of anything that should be outsourced and diversified for stability shouldn’t food be? Locavore sentiments are great, but in reality, being able to transfer food from areas of plenty to areas with little is sort of a fundamental requirement for stable societies. Starving people tend to get pretty cranky.”
“The issue is transportation. We are wholly dependent on liquid fuels for that, and they just quadrupled in cost in a decade. It’s an awfully long way by sailboat or horsewagon from the places that have the food to those that don’t. The second issue are chemical fertilizers, which will also become scarcer, diminishing yields per acre everywhere.”
- The Poster Formerly Known As Anonymous
“The ALR is not about locavore sentiments. It’s about security. It’s well and good to diversify and outsource food production, but if one day one of the areas with plenty can’t or won’t send the food shipments for whatever reason, a shitload of people get very cranky, very quickly.”
- The Poster Formerly Known As Anonymous
“Acquaculture? More factory chicken farms? Electrified railways supplied by nuclear or hydro power? Nuclear generated hydrogen for transport? Not to be flippant or anything, but I’ve been hearing about the end of the world for over 2,000 years, and science has proven that mankind is unsustainable for 200 years. Yet our food production and productivity continues to grow, birthrate is declining in most countries, and we’ve always solved our problems before. I think it’s a bit egotistical to think that, even though everything, been (comparatively) skittles and beer for our species for 200,000 years now, it’s all going to go pear shaped before this generation passes the baton.”
- Ralph Cramdown
““Running out of land”. “Immigration”. “Mountains”. “Water”. “Hard asset”. The list goes on. What these rationales have in common, besides being fallacious, is that they’re nice ‘n easy for folks to understand, and make handy talking points for promoters. And how about this gem, heard from a senior RBC advisor, in defence of Vancouver’s current real estate prices: “Well, everyone needs a roof over their head!”
- El Ninja
“We are completely dependent on food imports.”
Then, why are we growing Christmas trees instead of wheat in the ALR?
- Cyril Tourneur
“Christmas trees? That’s part of what the Fraser Institute calls “human ingenuity and market forces.” Have you all considered that this obsession with being self-sufficient in the lower mainland is just a group version of ‘Prepper’ madness?
“Britain has not been fully self-sufficient since the eighteenth century. It imported large quantities of wheat, eggs and sugar during the Victorian era, growing an increasingly small proportion of what it ate until World War II, when millions of consumers followed the plea to “dig for victory”. This self-sufficiency trend was immediately reversed after the war ended, however.”
Even at the height of the Battle of the Atlantic, people weren’t starving in Britain. Those in the cities weren’t eating well, but they weren’t starving. And, not to put too fine a point on it, commodity and shipping prices were rather high at that point. Y’all are wanting to prepare for a worse scenario than that?”
- Ralph Cramdown
A few thoughts from a non-expert in this field:
This all looks like a problem with dietary behaviours as much as it is a problem with land use.
As an example, Vancouver Island apparently imports 90% of its food. We suspect that number could be reduced by a lot, but people choose not to produce the food and/or change their diets.
It seems people enjoy having access to the dietary variety offered by foods sourced globally. Who wants to give up avocados and bananas unless necessary? Consequently, dietary behaviour will likely be shaped by circumstance rather than choice: people will only give up certain items when they become unavailable, or prohibitively expensive. Fuel costs and other such considerations will likely apply natural pressures in this regard. People will have to adapt. If such changes happen in a precipitous fashion, that could be a problem.
As a society, should we put the effort and resources into developing an arrangement where we ensure that adequate ongoing protein and calories supplies for our entire population are available from BC & Canadian sources? We could do this, but there would be substantial expense involved. A bit like earthquake preparation, or forms of insurance. A diet from such sources would likely be far less diversified than we currently enjoy; it’d be more an emergency measure than an immediate and total replacement for current diets. Surplus during non-crisis periods (such as the present) could be exported, perhaps making the system partly self-supporting.
How close are we to having such a plan working right now?
If we had to immediately stop all food imports/exports, what would our diets look like?
Would we have enough calories/protein to sustain the Canadian population?
Even if we did set up such a plan, we’d expect people to continue to enjoy the diversified globally-sourced diet, while it was still available. Ingenuity may allow for current circumstances to continue for far longer than many anticipate.
Yesterday I expressed the opinion: “I think that the ‘scarcity’ of land (in Vancouver) is greatly over exaggerated, even within the ALR restraints. At the same time, I suspect that the ALR applies even further artificial limitations on land that is available… I suspect that there is massive amounts of land available for the accommodation of people, AND enough land to meet our agricultural needs.” Perhaps I’m wrong on the latter bit, as TPFKAA has suggested.
But what percentage of Vancouver’s food supply currently comes from the ALR?
If the ALR is only supplying us with a small fraction of our current diets, how important is it as part of any future food supply plan?
If the ALR is being used to grow Christmas trees, to support ‘hobby farms’, and to grow crops that are largely exported, why not more strongly encourage it to be used it for local food supply, or, alternatively, use it for housing?
Pre-emptive retort from TPFKAA:
“We need to start creating infrastructure that can tap other sources, or changing our profligacy with energy use, or both. While in principle there may be enough alternative energy to supply our needs, it takes many, many years to put the machinery in place to tap into these energies. You can’t build the port mann bridge in a day, nor can you replace the energy from oil at the pace of market forces. Market forces will lead to an abrupt cutoff, with not enough time to put that infrastructure in place. It’s hard to build and design shit when you hungry, the lights don’t work, and trucks can’t carry yo shit around. S’all I’m sayin, y’know?
The ALR is a damn important piece of land that needs not to have condos and sprawly mcmansions slapped onto it. It is a part of the solution.”
“Vancouver has a finite amount of land. The prices are only ever going to go up.” – Douglas Coupland, 2000
“Vancouver has a finite amount of land. The prices are only ever going to go up.”
- from ‘City of Glass’, [p22], Douglas Coupland, 2000
Documenting the life of the “Vancouver is running out of land” meme.
We are particularly interested in trying to find record of its earliest mention.
Local historians, help us out. – vreaa
This question previously raised here:
‘Vancouver Housing Affordability – Century Long Crisis or Boom ‘n Bust Cycles?’
VREAA 25 Nov 2012
‘The State Of Construction In Vancouver’ – “The townhouses are for sale for $2M to 6M, they are unsold, and, it seems, already in need of repair.”
“I live on the top floor of a high rise in the South Granville area and can see the roofline of the new townhouses at 16th & Granville from my living room. Yesterday, in the teeming rain, I spotted someone tossing a white sheet of plastic over the edge of the facade in what appeared to be an attempt at blocking a leak. The townhouses are for sale from $2 to 6M, they are unsold and, it seems, already in need of repair. This is the state of construction in Vancouver.”
- Observer at VREAA 1 Nov 2012 9:59am
When a market rewards workers more for quick, shoddy work than it does for genuine honest craftsmanship, building quality will obviously drop. That’s human nature.. why do it right when you can get paid the same (or even more!) for doing it poorly, and doing it quickly?
“How is it Seattle, just 3 hours away, can produce the people and capital to create and run such great engines of capitalism, but in Vancouver all you have are greedy rats flipping their homes and telling themselves it’s the best place on Earth?”
“I just looked at a beautiful 580 sq foot first floor studio in Seattle’s Capitol Hill, about a 10 minute walk to downtown, for $179,000 dollars.
Here in Seattle there is Boeing, Microsoft, Amazon, Costco, Jones Soda, Starbucks and a company that every real estate board in Canada would prefer that you never ever ever know exists, namely zillow.com.
All of these companies were founded in Seattle. There are dozens of others that have their US base here like Nintendo, Expedia and Holland America Line.
How is it Seattle, just 3 hours away from Vancouver, can produce the people and capital to create and run such great engines of capitalism and in Vancouver its like greedy rats flipping their homes and telling themselves its the best place on Earth?
My reading of the situation is simply that the level of cognitive dissonance and delusion is just absolutely beyond comprehension.
Please Vancouver, explain yourself. Actually, never mind: the market and its natural forces will deliver the explanation to you in a hurricane like catastrophe soon enough.”
- Bob at VREAA 6 Oct 2012 at 5:59pm and 6:07pm
It is fair to compare Vancouver RE with that in Seattle, and we come up sorely overpriced.
The Mayor – “This is further evidence that Vancouver’s economic action strategy is working to create highly skilled and high-paying new jobs” [... in RE related industries.]
“While the news is full of warnings about a national housing slowdown and shaky global economic future, the Vancouver region has had a building boom almost equal to pre-recession years.” …
“Some cities are crowing about their success, as Vancouver did last week, noting that it has processed building permits worth $1.1-billion in construction value for the first six months of the year.” …
That prompted Mayor Gregor Robertson’s office to issue a statement about the encouraging numbers and the reasons.
“After keeping taxes low, and maintaining permit processing times despite higher volumes, this is further evidence that Vancouver’s economic action strategy is working to create highly skilled and high-paying new jobs,” he said.
- from ‘B.C. building boom nears pre-recession levels’, G&M, 3 Sep 2012
We’re hearing innumerable stories about existing condo stock that isn’t selling, and yet there seems to be more construction going on than ever before. It appears our city has become even more overly dependent on the RE industry in recent months; it’s almost the only game in town.
Throw gasoline on a waning fire and things look bright for a few seconds more.
Increased Density Features Prominently In COV Affordable Housing Contest – “It brings down the cost of housing through sub-division and shared equity.”
The City of Vancouver recognized thirteen entries from a competition launched in May.
The designs set out a variety of plans to increase density while dropping real estate prices, from building long houses in lanes to constructing bridges of housing atop existing buildings.
Christina DeMarco’s Thin Streets concept, which pitches narrowing streets and adding row units, took home an award.
“I came up with the idea by cycling to work across the city every day and I realized there was a lot of under-used road space in the city,” she said. “There’s still enough room for a sidewalk, a road, and street trees.”
“UBC student Andrew Neuman won an award for his shared equity concept, which divides properties and adds housing where residents would buy shares in co-ownership.
Neuman says it could reduce the price of a dwelling on a $1-million lot to as little as $100,000.
“So it brings down the cost of housing through sub-division and shared equity.”
Neuman said the issue of affordability in Vancouver hits close to home.
“Unless something like this sorta comes about, I will not be able to afford to live here,” he said.
“I’ve been an architect student … my wife is a teacher. We have three kids and on those salaries alone, based on … the cost of housing in the neighbourhoods that we’re currently living in, in a small basement, we won’t ever be able to afford to buy anything like that or move up in that way.”
- from ‘Vancouver eyes new affordable housing ideas’, CBC, 31 Jul 2012
[hat-tip Jeff Murdock]
Let’s not forget that we’re still near the peak of a speculative mania in housing prices, and that most current ‘increase density’ plans also have the effect of maintaining the high relative cost of housing; they amount to “pay a bit less; get a lot less” plans.
600,000 square feet is to be dedicated to office space packed in around Rogers Arena and BC Place – “We have our work cut out for us to fill that space.”
“The city’s planning department, concerned about the loss of key office sites on Vancouver’s small downtown peninsula to the condo boom of the 1990s and 2000s, decided several years ago that the last bit of undeveloped former industrial land that was the site of Expo 86 – Northeast False Creek – should include 1.8 million square feet of commercial space.
Of that, 600,000 is to be dedicated to office or, as the planners call it, “job space,” packed in around Rogers Arena, the home of the Vancouver Canucks hockey team, and BC Place, the government-owned stadium where the B.C. Lions play football and Whitecaps play soccer.
That 600,000 square feet is the equivalent of a whole Park Place tower in Vancouver’s business district or the new PricewaterhouseCoopers tower on York Street in Toronto.
Now, landowners in that area are trying to figure out who they’ll get as tenants.
“We have our work cut out for us to fill that space,” says David Negrin, president of Aquilini Development, one division of the Aquilini family empire that includes the Canucks, Rogers Arena and a host of other businesses and development projects. “It’s just a tough location because it’s on the edge of the [central business district].”
- from ‘Canucks owners gamble on new office district in Vancouver’, Globe and Mail, 30 Jul 2012
Despite the departure of anchor tenants such as HMV and Starbucks, Robson Street — the second-most-expensive retail street in Canada after Toronto’s Bloor Street — is far from dead, according to local retail experts.
The street is a vibrant area going through a time of transition and speculation, with landlords wanting to get top dollar, but retailers hesitant to pay high rental rates, said David Ian Gray, retail consultant with the firm DIG360.
“It’s an interesting time. Robson is in this state of flux,” Gray said. “But when you see the J Crews, the CB2s and the Forever 21s coming in, it’s not a dead street.”
However, a new report by Colliers International found the price of rent on Robson fell by 25-per-cent year over year on leases signed during the nine months ending March 31, but the decline is not an indication the street is losing its cachet, according to James Smerdon, Colliers’ director of retail and strategic planning in Vancouver.
Monthly retail rents for new lease deals on Robson averaged $150 per square foot — a bargain price for international retailers, who pay an average of $2,250 per square foot on New York’s Fifth Avenue, which tops Colliers’ global list.
The drop in rent on Robson is a result of a few large stores opening in mid-block locations on the upscale street, rather than on the corner, where rents are typically higher, Smerdon said.
“This isn’t an average rate, it’s a survey of recent and notable transactions,” he said.
According to the Colliers’ survey, new leases were most expensive on Toronto’s Bloor Street, where rents averaged about $310 per square foot, followed by Robson Street, Alberni Street, and Montreal’s Rue de la Montagne, where new lease rates averaged $80 per square foot.
- from ‘Don’t write the obit for Robson St. just yet’, Tracy Sherlock, Vancouver Sun 10 July 2012 [Hat-tip Joe_Blown_Away_By_High_Housing_Costs]
Average or not, it seems Robson is available at $150/sqft.
Vancouver’s Robson $150, Toronto’s Bloor $300, NYC’s Fifth Avenue $2,250.
Perhaps accurately reflecting the relative economic and cultural importance of these centres?
“James K. M. Cheng Architects Inc. submitted a rezoning application to the City of Vancouver that outlines a plan for a multi-use site at 750 Pacific Blvd., known commonly as the Plaza of Nations. Commercial use would include small-scale retail, hotel, office, restaurants and cafes, while community use would include a sports-science centre, a daycare and an ice rink that could serve as a part-time practice arena for the Canucks.
The proposed pièce de résistance is a residential structure, with between 1,700 and 2,000 units, that takes the form of a giant arch. The development would provide a mix of housing types and include private ownership and purpose-built rentals for residents of various ages and income levels, according to the application.
James Cheng said the arch-shaped building will serve as a window through to BC Place. “Vancouver has been criticized for having so many towers, and everything looking the same,” he said. “What we tried to do is create an urban piece that is strong enough to stand up to the stadium, but still have a relationship to it.” —
“The developments in that section of our city, which is our largest and last big waterfront property, should be a special place,” said Councillor Raymond Louie. “For a long time, it sat empty. This is an opportunity for us to develop it in a sustainable fashion where it is able to serve the people who will eventually live there, but the wider community as well.”
- from ‘Proposed complex would pump life into dead zone’, G&M 4 Jul 2012 [hat-tip Joe]
A tad reminiscent of Paris’ ‘Grande Arche de la Defense’ (above), only even more poorly proportioned and even less pleasing on the eye.
Bad sci-fi design. (“Could I get my star-fighter through that?”)
“Talked to a friend tonight who just moved into a $700K rental apartment at UBC. The wood-framed building, on leased land, is two years old and floors are already sagging.”
“Talked to a friend tonight who just moved into a rental apartment at UBC. Building is two years old and floors are already sagging, so much that her closet doors keep opening by themselves, and drawers have a hard time staying closed…
Market value? $700,000, for a wood frame condo on leased land.”
- jumpin in at VCI 30 may 2012 10:48pm
“The condo bubbles in Toronto and Vancouver are caused by foreign speculation and are making housing unaffordable and creating financial risk for the country in terms of government-insured mortgages. But there’s another issue of vital concern to taxpayers.
There are three times more condo high-rises being built in Toronto than in New York City and seven times’ more than in Chicago. This boom is not the market at work, but is manipulation by “hot money” from abroad.
“I have come across something that I find astonishing, and which amounts to systemic tax fraud by investors, mostly foreign, on a massive scale,” wrote an investor involved in the industry.”
“Condo brokers tell me I can flip my assignment and pay no tax and there is no paper trail. They say we do it all day long,” said the investor who asked to remain anonymous.
Under CRA rules, foreigners making Canadian-sourced income are fully taxable by the federal and provincial governments. In Ontario or BC, the total tax bill would be 46% or $46,000 in tax for $100,000 profit.
The unpaid taxes could be staggering, said a real estate agent. In Toronto, 20,000 condo units have been sold each year for the past five years. Let’s assume one-quarter were sold to foreign speculators who flipped the assignment and made $100,000 profit without paying taxes. Their Canadian-sourced income would total $500 million a year, and they would owe 46% of that in taxes or $230 million.
- from ‘Taxpayers also victims of ‘hot money’ behind Canada’s condo bubbles’, Diane Francis, Financial Post, 4 May 2012