Friday, October 7, 2011
Vancouver Politics (help) to Keep Supply Low and Prices High
My clients are always asking me to predict when and how the Vancouver housing market will change. Sellers want to know if they should sell now or if prices will continue to rise. Buyers want to know when the "bubble" is going to burst.
There are some fundamentals in Vancouver that keep price high - limited land base, strong immigration, basic geography and desireable lifestyle. But here is one more reason that you may not have thought of as to why Vancouver prices have remained high over the years: Vancouver politics.
As a developer, I can attest to the difficulty of building a multi-family project in the City of Vancouver. Zoning bylaws in Vancouver are extremely restrictive and it can take up to 6 years, with considerable cost and complexity along the way, to gain rezoning and other approvals for a single highrise tower. This introduces more risk to the developer, in addition to slower returns on investment.
The solution to introducing more supply, and therefore bringing down the cost of housing in Vancouver is simple:
1. Reduce planning regulations and red tape;
2.Allow property developers more leeway to build taller buildings faster;
Now we all know that politicans represent the people (at least leading up to an election), and that regulations are put in place for a reason. However, I see so many wasted opportunities that it makes me want to cry over my super-food-smoothie at times. For example, what is with the low roofed Canada Line stations on Cambie? Wouldn't a tower overhead be mutually beneficial to both residents and Cambie Village merchants, not to mention encouraging transit use? What a great missed opportunity to create housing! Instead, we are left with a pretty structure to enter the station.
People often talk about higher density housing and in some cases even support it. But when projects are planned and public hearings are held to gain community support, polititians more often than not cave to local (and vocal) "not-in-my-backyard" (NIMBY) protests. Legitimate concerns need to be addressed, but the cost of forever protecting large single-family lots, even against small density increases such as laneway homes, is one we all pay.
Contrary to popular belief, I have never seen the value of homes in a neighbourhood with increased density go down after rezoning! Ever. It always goes up because developers accept the risk of buying land, adding value through increased density, and selling the newly created homes at a higher price per square foot basis.
On May 10th Vancouver council voted to increase Cambie corridor building heights to 12 storeys, Developers immediately recognized the value of increased density allowances and for this reason, the lucky homeowners along Cambie are seeing their lots (with older, smaller homes) sell for $3 to $3.5 million.
In my opinion, much higher buildings are neccessary in these locations, esspecially around the Oakridge and South East Marine Drive transit stations (which would have led to even higher values for the Cambie Corridor lots).
One more trend to consider: 70% of the residential housing in Vancouver is still detached homes, and yet Baby Boomers and busy young families alike are asking for smaller homes, homes on smaller lots with less maintenance, and homes with revenue suites (higher density). Not keeping up with this demand continues to drive up our property prices.
Next time a developer comes knocking at your door, invite him in! He (or she) may just have an offer you don't want to refuse.
Categories: 4345 Rockridge Road | Arbutus, Vancouver West Real Estate | art and science of negotiation | Assessed Values Vancouver Real Estate | BC First-Time New Home Buyers' Bonus | BC Home and Garden Highlights | Better search engine than realtor.ca | Board Statistics | Bubble | Building a new home in Vancouver | Building on irregularly irregular shaped lot property vancovuer | Buy a New or Used Home in Vancouver | buyer's market | buying a home in Vancouver | buying new construction real estate in vancouver | Buying re-sales vancouver real estate | Cambie | Cambie Listing Vancouver Real Estate | Cambie, Vancouver West Real Estate | Canadians invest in Arizona Real Estate Is now a good time to buy AZ Real Estate | Charity Donation | charity donation real estate agent vancouver | Check out my Mobile Search App | Chinese Influence on the Vancouver Housing Market | Chinese influence on Vancouver housing market | cigar-et smoke smoking strata bylaws | Coal Harbour | Coal Harbour, Vancouver West Real Estate | Common mortgage mistakes | Competition and the MLS System | Competition Bureau and the MLS System Changes | Condos | CRFS Contingency Reserve Fund Study Vancouver Real Estate | Current Housing market conditions in Vancouver | Current housing market conditions in Vancouver, Video Market Update for February 2013 | December 2011 Market update | decluttering a westside vancouver home | Depreciation Reports Strata Reports CRF Study Contingency Reserve Fund Study | Douglas park vancouver neighbourhood | downtown | Downtown VW | Downtown VW, Vancouver West Real Estate | Dunbar, Vancouver West Real Estate | Fairview VW | Fairview VW, Vancouver West Real Estate | False Creek | False Creek, Vancouver West Real Estate | February 2011 Vancouver Real Estate Market Report | Four Great Things about Laneway Houses in Vancouver | Green building, Building a green home in Vancouver, Live Green, Environmental Construction | Harbour Green | Heritage Home Renovation | Home and Garden Show 2011 | Home building in Vancouver | Home buyers guide Vancouver real estate | Home buyers Guide Vancouver Real Estate Purchase | homebuyer's guide, home buyer handbook, purchasing a new home - the process | How is the Vancouver Real Estate Board Doing | How to make an offer on a home in Vancouver | How to purchase a home in Vancouver | Important words to know from CMHC when buying a home | June Vancouver Real Estate Market Update | Kerrisdale, Vancouver West Real Estate | Kitsilano | Kitsilano Home Open House | Kitsilano, Vancouver West Real Estate | laneway houses - cash from your property | learn about real estate mortgage options and mortgage insurance | Luxury homes | Main, Vancouver East Real Estate | Market Report Update from Vancouver Real Estate Board | market trends | May 2010 Vancouver Market Report | Mortgage advice when buying a home in vancouver | Multiple offers | New vs. old homes Vancouver Real Estate | Newsletter articles | North Vancouver Real Estate | Northlands | Oakridge VW, Vancouver West Real Estate | Patina Vancouver High Rise YMCA | Preparing your home for sale | Real Estate Commissions | Real Estate Market | Real Estate Market Report | Real Estate Statistics for Vancouver BC | Real Estate Vs a Live Insurance Investment | Rescinding a pre-sale condo, Vancouver real estate | Rockridge | Rockridge, West Vancouver Real Estate | S.W. Marine, Vancouver West Real Estate | Search for Vancouver Real Estate | Sell your home faster | September market update | Single Family home market report for Vancouver West | Sold | Sold Listings | South Cambie, Vancouver West Real Estate | Southlands Country Fair Sunday Sept. 16th from 10AM to 4PM | Special Levies Contingency Reserve fund Studies | Statistics | Tempe, North Vancouver Real Estate | The steps involved in purchasing a home in Vancouver | The Value of a REALTOR in Vancouver | Tips for selling a home during the holiday season | Understanding Stats | Understanding the data and stats | Ups and Downs of the Vancouver Market | Vancouver | Vancouver East Real Estate | Vancouver market report - september 2011 | Vancouver market report update for October 2011 | Vancouver Market Update | Vancouver Market update report real estate | Vancouver Most Expensive City | Vancouver real estate | Vancouver Real Estate Average Priced Home | Vancouver Real Estate Board Market report | Vancouver real estate market report | Vancouver Real Estate market report for March 2013 | vancouver real estate market report May 2011 | Vancouver Real Estate Market Update | Vancouver Real Estate Market Update for March | Vancouver Real Estate Market Update for March 2012 | Vancouver real estate market update report | Vancouver Real Estate Video Market Update for December 2012 | Vancouver Real Estate Video Market Update for September 2012 | Vancouver Video Market Report | Vancouver Video Market Report for January 2012 | Vancouver Video Real Estate Market Update | Vancouver West Market Report Vancouver BC | Vancouver West Real Estate | Vancouver West Real Estate Market Conditions | Vancouver Westside Real Estate Stats | Vancouver Westside Single Family Home Real Estate Trend Graph | Victoria VE | Video Market Update for June from the Vancouver Real Estate Board | Video Market Update for October 2012 | Video Market update from Real Estate Board of Greater Vancouver REBGV | Video Market update from the real estate board of greater vancouver | Video Market update from the real estate board of greater vancouver for January 2013 | Video Market Update from the Vancouver Real Estate Board for April 2013 | Video market update from the Vancouver Real Estate Board for March 2013 | Video Report from the Vancouver Real Estate Board | Vnacouver Market Report for February 2012 | West End VW, Vancouver West Real Estate | West Vancouver Real Estate | Westside Real Estate Statistics for May 2013 | What is keeping vancouver real estate prices high | why invest in a single family home in vancouver westside | Why it is better to use a buyer's agent | Win / Win Conflict Resolution | Yaletown, Vancouver West Real Estate