EDITORIAL | Upzoning is Making Vancouver Unaffordable

Over the past two years, Vancouver City Council and its Planning Department have been increasing height allowances throughout the City. Almost every neighbourhood faces or has faced either a wide sweeping height plan or a precedent setting rezoning application: the DTES, the West End, Mt. Pleasant, Norquay, the CBD, and now Cambie St. This surge in upzonings is a key causal factor of Vancouver’s plummeting affordability.

In their current form, increases in height allowances essentially constitute deregulation of the real-estate market. By removing limits placed by either community-led groups or the planning department, developers can build whatever they think will be most profitable on a piece of land. In Vancouver, this means maximizing views, which means maximizing height. It also means luxury condos. If this process continues, the City’s affordability will continue to worsen.

Increasing height and density allowances on a piece of land drastically increases its value. Whether through a neighbourhood-wide ‘blanket rezoning’, or through a single plot ‘spot rezoning’, increases in density equate to windfall profits for real-estate developers. Even without any new construction, upzoning a parcel of land plays a huge role in how it is valued. This is why developers buy up properties and then “donate” to political parties like Vision Vancouver, with the expectation that their properties will be upzoned. This can lead to spiraling speculation throughout an area. There is a lot of money to be made from these rezonings.

More Trouble for Regional Growth Strategy

Thanks to a single municipality with clear vision and sturdy backbone — Coquitlam — the juggernaut Regional Growth Strategy (RGS) has at least temporarily failed to careen its done-deal swath across B.C.’s lower mainland. The RGS aims to provide a policy blueprint that would govern the “pattern and form of development” of Metro Vancouver (formerly Greater Vancouver Regional District) for the next thirty years.

Grassroots criticism of the RGS began to acquire momentum in late 2010. MetroVanWatch has established a base for information dissemination and communication on the RGS issue. Various representations were made (or frustrated in attempt) to Metro Vancouver itself and to the 24 constituent jurisdictions. [See appended note for an account of representation to City of Vancouver.]

Points of concern for ordinary people (not bureaucrats, not politicians, not developer interests) have included:

Dubious public consultation process that culminated in a few poorly advertised, ill-timed public meetings late in 2010 for the affected 2.2 million population (locations were Coquitlam, North Vancouver, Surrey, Burnaby — nothing in Vancouver)
Effective disregard of the overwhelmingly negative feedback received through the perfunctory public process
Extensive powers exercised by bodies not accountable to an electorate
A “strategy” that seeks to substitute growth for livable region
Facilitation of sprawl growth through removal of land from agricultural reserve and through expansion of urban containment boundary

Coquitlam’s refusal of the RGS on 21 March 2011, following a unanimous vote of their council, has thrown the extended and complex policy project into a “dispute resolution process.” On 8 April 2011 Metro Vancouver set sights on recalcitrant Coquitlam, proposing binding arbitration to force acceptance. Nine Metro Vancouver directors opposed that move.

Ida Chong, the provincial minister responsible, has responded to notification and directed Metro Vancouver to initiate instead “a non-binding dispute resolution process by May 16, 2011.” In other words, the Province told the Region to take off the jackboots.

On Saturday May 14, the Vancouver Sun weighed in heavily on the RGS issue, running both a lead editorial and an opinion piece by Daphne Bramham. The editorial in particular aligns with already reported concerns emanating from the province’s “three biggest business groups” — B.C. Chamber of Commerce, Business Council of B.C., Urban Development Institute. In fact, business interests have sought

to participate in the dispute process, saying they weren’t given the chance to be heard during four years of public consultations. (Sinoski, May 6)

Black humor spreads its wings here. Grassroots critics have been told flatly and repeatedly that the years of process are so adequate they should not dream of making complaint. (Many meetings and passage of much time always provides bureaucratic grounds to assert worth of consultation — regardless of quality of advertisement, extent of engagement, or nature of response to criticisms.) Perhaps business interests will garner more respect?

Besides reinforcing the editorial focus on economic factors, Bramham blasts Metro Vancouver as “probably the most egregious example of Canadian citizens having no voice in decision-making.” Finally grassroots opposition has succeeded in generating this echo in mainstream media.

The worry now is that RGS will be taken to task for the wrong reasons. For example, if the Urban Development Institute wants to affect the current version of policy, it’s hard to believe that things like preservation of agricultural land, respect for a strong urban containment boundary, or maintenance of adequate industrial land will stand at the top of their agenda.

Where all of this RGS debate goes from here depends in part on how well you the reader understand the issues, and whether you take opportunities to speak up.

Whatever happened to the “speculation tax”?

This week, Taiwan implemented a “luxury tax” on housing properties lying dormant due to speculation (as reported by the BBC). This begs the question: why not take action in Vancouver, where the affordability crisis is similarly severe?

During his 2008 campaign, Gregor Robertson proposed such a “empty condo tax” to get more housing onto the market and cool-down prices. But as with other promises, he has failed to deliver or take responsibility. (BC law allows strata councils to ban renting-out condos – whereas Ontario law, for example, does not – and this partly explains the high condo vacancy rates. Armed with this excuse, and under pressure from developers, Robertson grew content to blame the provincial government instead of using tools at his disposal to slow speculation.)

Another reason for lack of action on speculation is that the real estate lobby has been spinning the numbers. In May 2009, Andy Yan of Bing Thom Architects published a study estimating the percentage of “empty condos” (identified by low hydro usage) at 5-8%. Real Estate interests who were against the “empty condo tax” suggested that Yan’s work disproved the empty condo “theory.” But even this “low” estimate suggests that the condo vacancy rate is 250-400% that of the 2010 rental vacancy rate. With 80 thousand condos in Vancouver, there are about 5000 empty condos, many of these downtown.

The City’s Housing Centre Director Cameron Grey estimates that, in total, there are about 20,000 empty housing units in Vancouver (including all condos, houses, duplexes, etc). For comparison, that number is roughly equivalent to the total number of social housing units in the city (21,500, according to City numbers).

Andy Yan told The Mainlander that the ’empty condo’ phenomenon is only one driver of Vancouver’s spiraling housing prices. “The point of our story is that even if you make 5,000-10,000 available through an ’empty condo’ tax, it might not make a big difference. Other behaviours of property owners, such as ‘flipping’, might be also contributing to skyrocketing housing prices.” He suggested that while an ’empty condo’ tax might be difficult to enforce, regulations on speculation such as property transfer fees are relatively simple to implement. Yan also emphasized that Vancouver is in desperate need of affordable rental, while empty condos rented-out at market price would not fill this need.

Whereas the real estate lobby saw Yan’s study as a vindication of unregulated speculation, on the contrary we at The Mainlander propose an inverse take-home-message: that a multi-pronged approach will be required to regulate the market. Penalizing owners of empty condos is not a silver bullet for the speculation spiral driving up housing prices in the Lower Mainland. But it is a start.

Community paints Pantages to protest condo development

This week, Downtown Eastside residents rallied at the abandoned Pantages Theatre on the 100 block of East Hastings, and painted its facade with slogans like “100% social housing here.”

The Pantages Theatre and adjacent properties (158, 138, 134, 132, 130 East Hastings) have been bought up by developer Marc Williams, of Worthington Properties (for the company’s *interesting* history, read this and this). Last month, the City granted Williams’ request to begin demolition of the heritage building. Development permits have been issued, and Williams will be presenting his plans for a condominium complex to the Development Permit Board on August 22nd 2011.

Downtown Eastside housing advocate Wendy Pederson says a condo development next to the Carnegie Centre would be “like a bomb in the middle of the low-income community.” The Downtown Eastside Neighbourhood Council has identified the Pantages as one of ten sites to be bought by the City for social housing before the 2011 municipal elections.

It should never have come to this. Williams and the City failed twice to come to an agreement on saving the Pantages Theatre and to bring in other partners to create social housing in the surrounding abandoned buildings.

In 2008, Williams, the City, and the Province devised a plan to save the theatre and build social housing. But the deal fell through at the last minute on Sept 30 2008, shortly before the municipal election.

The preservation project languished under Vision Vancouver’s leadership. In Dec 2009, a disillusioned Heritage Vancouver, which had identified the Pantages as the city’s most important threatened heritage site, announced it would abandon its campaign to save the building.

On Mar 22 2010, City Council met in camera, to discuss purchasing the site. City staff recommended not purchasing the site, and Vision caucus supported this decision.