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A very telling, quite neutral article about Michelle Yu and her specialty of land assemblies by Christopher Cheung in the Vancouver Courier.
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There are three Vancouver Specials near the old Little Mountain social housing complex on Main Street. The specials were built in 1979 and were assessed at about $1.4 million each. But as a set, they sold for more than $10 million, according to Western Investor in December. That’s more than double what they would’ve fetched if sold separately.

These assemblies are for multi-family buildings on arterials, empowered by Vancouver zoning, and the land cost is totally out of control – in this case 250% of the current appraised land value, which will be passed on in the sale price or as rent.
Can anyone reading this still believe that the replacement of these sorts of detached houses, which provide homes for extended families, students in suites and shared-accommodation arrangements, will provide affordable new housing geared for people who earn their living in Vancouver-level wages?
Or is the game now just to provide more small housing units in the hope the price will eventually drop?

Comments

  1. At the current (very ridiculously bubble like) prices for new units, a 1200 sqft family sized housing unit (or ‘home’ as I like to call them) will probably cost around $1,400,000, or about what the old house might’ve cost. A new house on that land would likely cost $2,400,000 or more. So it is certainly more affordable than the comparable ‘new’ house, though also smaller.
    Plus, lots more people will get to live there than otherwise! More homes for people to live here. Even if people were unusually packed in to the old houses and there were 8 people per house those 3 houses would hold 24 people. On a 3 lots assembly they might put 60 homes. If 10% are empty and the rest have the average household size we now have homes for around 90 people on the same land.
    Many of these homes will be small, but they’ll be proper homes with separate entrances. The smaller ones will, despite being expensive per square foot be dramatically more affordable than a house.
    All this despite the fact that land assemblies drive up prices. It would be great if we didn’t need land assemblies and we could just build small multifamily buildings on a single lot. That’ll need the city to make zoning changes.

    1. Or we could have just kept the existing house affordable by not indulging in speculation-inducing rezoning. The Vancouver Special would have been an entry to home ownership with the easy possibility of suiteing the ground floor for rental income. Lots of more people get to live there? Certainly not middle class people!

      1. 30,000 people moved to the city between the 2011 and 2016 censi. Each Special lot contains 70% open space, which works out to 224 m2 of land per standard 10 m lot (after deducting area for a double garage) or 2,240,000 m2 (2.4 km2) of land under this zoning. There is no more undeveloped land that Vancouver can use to meet demographic pressures.
        Can you not see the geometric challenge these facts present?

  2. Facts of life in Vancouver. More housing will cost a lot of money because land is expensive. A lot. And if new housing costs a lot it will drive old housing costs.
    Nowhere in the BC budget did I see mention of this basic fact nor the willingness to provide free land, for example via leases to coops by province or City of Vancouver.
    Nor did I hear “simplify building code or streamline approval process, as time is money”
    The new BC budget measure will curb demand somewhat but will mean basically more tax collected. How this will be channeled into free or cheap land for new housing is unclear to me.
    Land is cheaper further out, another fact of life.

    1. The city has provided the land component for 14 sites within a provincial initative to supply homes for the homeless. The buildings are decently designed concrete mid-rises with provisions for services and common space, and programming for future re-purposing was part of the design mandate. Outside of the land, the province paid for everything. The facilities are managed by non-profits.

    2. The above homes for the homeless initative could widely bne agreed to be worth it and valid, as would building rentals on city land funded by all three levels of government. Supplying subsidies or free land for private developers will not likley be seen as acceptable for market units.

    3. Re: “streamlined apperoval process … time is money”.
      That depends as much on the applicant as it does on staff. Well over half the applicants screw up their application through intransigence or incompetence while the queue is at record levels, reflecting the huge amount of development. The developers who have experienced architects and project managers who are mandated to get it right and meet bylaw requirements get through the process quite efficiently.

  3. I apologize if I am ranting, I take this “keep old houses for the sake of housing affordability” perspective very personally. The only reason I can afford to live with my family (on a noisy arterial) in the Cambie Village is because 20 years ago someone tore down a few old houses and built 80 homes in a multi-family mixed use development.
    If those old houses hadn’t been torn down to build condos I wouldn’t be able to afford to live here. There would’ve been 70 fewer homes for people to live on in my neighborhood and I would’ve had to buy somewhere else because I would’ve been priced out.
    Whatever place I and the other 70 families who live in my building would’ve bought then wouldn’t have been available to someone making less money than us, and so on and so on.
    People who argue for old houses instead of multi-family are effectively (even if unintentionally) saying that anyone young or poor or who didn’t already own here should either rent a basement or go live somewhere else.
    Because someone tore down a few old houses 70 more families like mine get to live close to work and parks and schools.
    There are better ways to do it then land assemblies and condos. We could zone to allow multifamily without assembly. We could have zoning and tax treatment to encourage purpose built rentals. We could allow dense multi-family housing off the arterials so more families can enjoy quiet leafy streets. We could capture more of the land lift and use it to build subsidized housing for low income people being evicted from those basement suites.
    Even if we don’t take those measures a few old houses are *worse* than 60 new condos.

    1. Gee that’s funny David, because 20 years ago a house in Cambie Village was about $315,000. Now I bet there isn’t a single unit in your complex that goes for that price. Had we stopped the cancer of offshore money in it’s tracks, those houses would still be affordable. Instead Christy Clark and her crew turned a blind eye to what was going on and those Cambie homes now cost around $2.5 million, an increase in price far outstripping the rise in local incomes.

      1. Offshore money follows immigrants. The immigrant train has left the barn. It will likely even increase. Trudeau the older opened Canada to folks outside of the traditional European immigrant. Trudeau the younger open it even wider https://www.theglobeandmail.com/opinion/justin-trudeau-rolls-the-dice-on-immigration/article36805629/
        Canada, and especially BC has FOREVER changed, and the money flow will NOT stop because BC is a beautiful place to live. Any (affluent) immigrant has traveled the world and has a choice where to put their money. Many chose Vancouver. Others chose Boston, London, Singapore, Sydney, Munich, Melbourne, Hamburg, Auckland or Paris. The SAME story there: housing is expensive, many empty condos, many second homes, poorer or middle class locals moaning about cost.
        Open borders, favoured primarily by progressive parties, favour the affluent as it relates to housing. Those with cash like to live in leafy neighborhoods, in beautiful places, along oceans in decent weather. Gee, not many places in Canada fit that bill. Not even Toronto or Halifax. Certainly not Winnipeg or Sudbury.
        One persons top 10 list here http://www.travelandleisure.com/trip-ideas/most-livable-cities-on-earth#melbourne-city-skyline-australia .. there are others with different cities in it but Vancouver is often among them !
        As such, it will NOT get cheaper. Quite the contrary.
        I heard the word real estate bubble” the first time 30 years ago when I moved to Burnaby. “Imagine that”, they said, “$250,000 for a Burnaby bungalow. Must be a bubble. Who can afford it. Must come down. Can’t continue. Bubble bubble bubble …” What’s that 1/4 million bungalow today in Burnaby ? $1.2-$1.5M. Soon, by 2020, likely over $2M. Why is that ? Because immigrants keep coming, because GenY is buying, because money is fairly cheap, because baby boomers live longer, because cities levy CACs and permit fees and DCCs, because building code is not streamlined and because they are not making any more landing the Lower Mainland for housing (although they could, in the ALR or the ocean and river flats)
        So should we upzone and build more housing: absolutely. But it won’t come cheap. You want affordable move further out or into tinier and tinier condos. NewWest, Burnaby or Surrey offers plenty of 2-3BRs under $500,000 and even more under $600,000. That is affordable for the middle class. Not a house for $1.5M in E-Van. That train has left the station. it will NEVER return !

      2. Yes an influx of foreign money raises prices. But in those 20 years the population of Vancouver increased by 120,000 people and the population of the metro region by around 500,000. Vancouver went from a city where most people lived in single family houses to a city where most people don’t because there aren’t enough of them.
        Twenty years ago Vancouver was already built out with houses. The population increase hasn’t been accommodated in houses. In those 20 years we’ve built out the old industrial lands, all the vacant land, some of the commercial land, and a bunch of old houses too with multi-family.
        If we’d skipped building all those places a lot of people who want to live here wouldn’t have been able to. When there is less housing than people who want to live in a place, prices go up, and the homes that do exist go to those who can pay the most.
        Building denser types of housing makes it more affordable for people to live here irrespective of whether there is foreign money in the market or not.

        1. True in theory but with high HIGH land prices that affordability ONLY works further out ie Burnaby, Surrey, New West .. due to assembly costs and very long time lines to get approvals in Vancouver land prices will remain skyhigh as we can see from the article.
          Only pre-zoned, pre-approved small land parcels for say 4 townhouses (THs) on say a 50 x 130 lots can you get faster builds and maybe $1.2-$1.5M vs 1.6 to 2.0M per TH ! So 3 more families with a bit of a yard but not cheap.

        2. Thomas: “Open borders, favoured primarily by progressive parties, favour the affluent as it relates to housing.”
          Always trying to blame the “pinkos”. Is it the flow of people or the flow of money that is of most concern? Because the free flow of money is the mantra of right wing, conservative, free market governments. They’d just as soon have the peons stay safely “at home” slaving away for the profits of the rich who can fling their investments around the world and play everyone off against each other.
          Allowing the free flow of money and not the free flow of people benefits the rich and enslaves the people. Inasmuch as foreign influence affects Vancouver’s housing market it’s fair to say it’s the money, not the people, that are problematic.
          So don’t blame the pinkos Thomas.

        3. Only if you allow in poor peasants and forbid $ in-flow will house prices not be affected. Canada, like Australia, allows relatively free flow of money and has a selection criteria for immigrants. It clearly favours the educated and wealthy. Every educated person who comes here has money AND connections back home, namely friends, relatives and business associates. So, every Iranian/Persian, every E-Indian, every Filipino, every Taiwanese, every Chinese etc person that comes here brings money with her or him AND tells his network about Canada, tells them how much money you can make in BC housing alone, how lax our tax enforcement regimes are, attracting more people or $s. Unless you outright forbid it, like the Pinko-Green party proposed, not much will change except you piss of Canadians that own second homes here. HUGE unintended consequences resulting in less supply and layoffs. HUGE HUGE unintended consequences .. HUGE
          https://www.theglobeandmail.com/news/british-columbia/canadians-with-bc-vacation-homes-to-be-hit-with-new-tax/article38061593/
          The last word on legislation hasn’t been spoken here and it has been wisely scheduled for 2019 !
          Best would be to eliminate provincial income taxes like WA or TX altogether (or the NDP BC flavour: for wages & declared income up to say $750,000) and then hit everyone hard with higher property taxes to make it fair.

        4. I’d also like to point out David, that if you are in a 20 year old strata building in the Cambie Corridor, you could be very well be a target of Ms.Yu and others who assist in land speculation. The article mentions she is branching out to get strata corps to sell.

        5. I could be, though likely not for another 10 years or more as the build is well maintained. If it happened the level of displacement would be pretty bad. At most they might be able to double the density. So the same increase in the number of new homes as when the building was built, but displacing 10 times as many people to achieve it. Much better to go from very low density houses instead, as it negatively impacts the fewest people.
          Hopefully we’ll more broadly up zone the surrounding residential neighbourhoods instead, and perhaps refine the 80% threshold for winding up stratas.

        6. I think the term “land speculation” is the WRONG TERM. It is really land acquisition for redevelopment, a totally necessary ingredient in new housing developments which require more than one SF zoned lot.
          Keep in mind heavy CACs, DCCs and building permit fees the city charges ON TOP, plus long timelines to get approvals. All that adds up to very high condo prices or rents. Add the now required 25% minimum rentals in new buildings and the remaining 75% will be EVEN MORE EXPENSIVE.
          New higher prices then pull up all other, i.e. older condo prices.

  4. This analysis assumes that if we forbid land assemblies and made the changes needed to allow single lot development at the same FSR this will be, that the land for each lot wouldn’t have been 3.3M.
    We don’t live in land, we live in floorspace. Raw land costs only matter if you believe you are entitled to an estate. The rest of us would be happy with a 1000 sqft of floorspace in a nice building. If we want the vast majority of future Vancouverites to have access to a nice 1000sqft apartment, then we need higher FSR’s.
    You can’t say “units are too small!” while also complaining that “the building is too big”

    1. You are getting close to the crux of the challenge. The Specials Michael illuminate sit on 374 m2 (4,000+ ft2) of land which could easily and comfortably accommodate far more people. Land is most definitely an issue in the context of supply, and when the supply is as constrained as ours using the land resource more efficiently becomes essential.
      Too many limit their interpretation of this to “development and profit potential” when in fact it’s a planning issue.

  5. I would really like to see the debate focus on actual community-building rather than this townhouse-lowrise blanket upzone mania – Kerrisdale in the 1950s was the model, and there are many good opportunities for adding density at crossroads rather than stringing it out as in these land assemblies – as in this post from almost a year ago: https://pricetags.wordpress.com/2017/03/11/build-more-kerrisdales-to-rework-the-rs-areas/

      1. Because it is FAR more expensive. Both will be available, at different price points. Look along Cambie corridor. NOTHING available today below $1000/sq ft (even facing noisy street in low units) and most even average condos 1200-1400/sq ft and close to park $1600+ per sq ft !

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