'We can no longer build what people can afford'
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As around 2,500 condos sit unsold in Metro Vancouver, experts warn of 'potential storm coming' for real estate | CBC News
The Canada Mortgage and Housing Corporation says there’s about 2,500 condos sitting unsold and empty in Metro Vancouver. The local real estate industry is concerned about layoffs and hopes for housing policy changes.
CBC (www.cbc.ca)
You can replace Vancouver for Montreal and you’d have the same thing.
In Montreal we laughed for years at the 1M$ shack or mansions in Vancouver, but now in Montreal an average house is also 1M, it was like 500k 5 years ago. There is something like 3000 empties condos too in Montreal, maybe 10000-12000 airbnb too, and 25-34yo people especially those with spouse/children are leaving Montreal en masse.
It is completely fucked up right now. Rent also doubled. People on minimum wage are making ~2k$/month, an average rent is 2k$/month.
Let’s not talk about an average new car at 65k$ and an average used car at 36k$
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I’m curious what she means by this exactly. Non-market housing and art is mentioned later on. Are they expected to pay for that themselves?
Development fees are one example. When a new apartment building is constructed, it needs water and sewer connections. The municipality typically charges the builder a development fee (on the order of 100k) to build that stuff. That immediately means the developer needs to charge buyers the development fee to recoup their costs.
Every level of government is going to add restrictions and requirements. Some may be non-negotiable: building codes to ensure the building is up to safety standards. We may want to revisit others.
Note - I work in Ontario, and this is my experience as an engineering consultant working with dozens of municipalities.
We’re finally at the end of infrastructure lifespan point for a good chunk of the province. That means Water/Wastewater plants, as well as the hundreds of kilometers of pipes required to transmit those liquids are at the end of their life for the first time since being installed (50-70 years).
The cost to replace those is enormous, and IMO, should be covered primarily by property tax and/or useage fees. However those fees have not actually set aside the money required in many places, which means that municipalities have been propping up their old infrastructure costs by charging large development fees. Doug Ford, as much as I hate him, slashed development fees allowed, which forced property tax rates to rise. This more accurately reflects the ACTUAL cost of owning a home with services by the municipality. Given that I believe growth stagnation is required, this is the direction we need to head. We can’t keep running this ponzi scheme of funding old infrastructure with new infrastructure fees. Its unfair to new buyers and subsidizing older homeowners.
We also likely need to take a look at the actual fees and costs associated with maintaining our infrastructure. Stormwater ponds, seen typically in subdivisions, are HORRIBLY under-serviced, with a recent investigation in our area revealing 75% of them had never been cleaned out since being put into service ~30-50 years ago. They typically have a service life of 10-20 years, and have been leaking pollutants into our creeks and waterways since. The primary reason - you guessed it, budget. At 1+Mil/cleanout, they’re expensive.
We’ve skated by up till now by externalizing these costs and letting the damages build up for tomorrow’s solutions. We can’t keep putting off those costs.
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Incorrect. Governments and corporation all have leaders who have steered us here, deliberately.
You can decide to make a left turn without knowing whether you’re going to end up in Kamloops or Kapuskasing by doing so. That’s the level of steering that’s going on: no one is looking past, at most, the next couple of intersections, and the GPS is on the fritz.
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I’m curious what she means by this exactly. Non-market housing and art is mentioned later on. Are they expected to pay for that themselves?
Development fees are one example. When a new apartment building is constructed, it needs water and sewer connections. The municipality typically charges the builder a development fee (on the order of 100k) to build that stuff. That immediately means the developer needs to charge buyers the development fee to recoup their costs.
Every level of government is going to add restrictions and requirements. Some may be non-negotiable: building codes to ensure the building is up to safety standards. We may want to revisit others.
Yeah, but development fees of that kind seem like they should only vary so much. Probably not to the degree of scuttling condos in Vancouver while they get made like sausages in Calgary.
Fire-prone slum construction isn’t the answer, that’s true. Regulations tend to wander into catering to nimby sensibilities in the West, though. Or into trying to externalise costs the government really should bear, like I’m kind of suspecting with the non-market housing mentioned.
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What the developer is saying is that their private industry can’t function anymore and it needs to be nationalized and social housing made a right.
Private industry where it can, social industry where it must.
It wouldn’t be any cheaper for the government, and the government itself has a limited amount of funding. (And that would be true regardless of the tax rate)
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Incorrect. Governments and corporation all have leaders who have steered us here, deliberately.
Deliberately, definitely not. Like OP said, why would anyone want this?
There’s leaders, but there’s a lot of leaders, they have interests at odds with each other, and none of them have a position that can’t be lost one way or the other (even dictators fear a coup). In the end, they end up part of the system, not controlling it.
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What a disingenuous rhetoric. Degrowth is centered on meeting people’s needs. No one needs a house. Everyone needs a home. Not everyone needs a home in Vancouver.
One central tenet of degrowth is accepting that nearly everything, at some point, will have to stop growing. This includes Vancouver, and a reasonable person could conclude that this headline is an econonic signal that now is probably the time.
Until absolute population declines, It’s a big country, medium density development in other areas can accomodate everyone more cost effectively than more unaffordable skytowers in earthquake vulnerable Vancouver.
So you’re thinking everyone in low-density suburbs would be better for the climate? (Degrowth is usually a climate thing)
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Note - I work in Ontario, and this is my experience as an engineering consultant working with dozens of municipalities.
We’re finally at the end of infrastructure lifespan point for a good chunk of the province. That means Water/Wastewater plants, as well as the hundreds of kilometers of pipes required to transmit those liquids are at the end of their life for the first time since being installed (50-70 years).
The cost to replace those is enormous, and IMO, should be covered primarily by property tax and/or useage fees. However those fees have not actually set aside the money required in many places, which means that municipalities have been propping up their old infrastructure costs by charging large development fees. Doug Ford, as much as I hate him, slashed development fees allowed, which forced property tax rates to rise. This more accurately reflects the ACTUAL cost of owning a home with services by the municipality. Given that I believe growth stagnation is required, this is the direction we need to head. We can’t keep running this ponzi scheme of funding old infrastructure with new infrastructure fees. Its unfair to new buyers and subsidizing older homeowners.
We also likely need to take a look at the actual fees and costs associated with maintaining our infrastructure. Stormwater ponds, seen typically in subdivisions, are HORRIBLY under-serviced, with a recent investigation in our area revealing 75% of them had never been cleaned out since being put into service ~30-50 years ago. They typically have a service life of 10-20 years, and have been leaking pollutants into our creeks and waterways since. The primary reason - you guessed it, budget. At 1+Mil/cleanout, they’re expensive.
We’ve skated by up till now by externalizing these costs and letting the damages build up for tomorrow’s solutions. We can’t keep putting off those costs.
So 50-70 years ago, did they take better care of infrastructure? I’ve seen these kinds of problems make appearances in Alberta, as well, and I always wonder how whatever unsexy bit of infrastructure was funded in the first place, given that it’s so politically costly to do.
Given that I believe growth stagnation is required
In Canadian municipalities specifically, or in general, like for climate reasons?
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Note - I work in Ontario, and this is my experience as an engineering consultant working with dozens of municipalities.
We’re finally at the end of infrastructure lifespan point for a good chunk of the province. That means Water/Wastewater plants, as well as the hundreds of kilometers of pipes required to transmit those liquids are at the end of their life for the first time since being installed (50-70 years).
The cost to replace those is enormous, and IMO, should be covered primarily by property tax and/or useage fees. However those fees have not actually set aside the money required in many places, which means that municipalities have been propping up their old infrastructure costs by charging large development fees. Doug Ford, as much as I hate him, slashed development fees allowed, which forced property tax rates to rise. This more accurately reflects the ACTUAL cost of owning a home with services by the municipality. Given that I believe growth stagnation is required, this is the direction we need to head. We can’t keep running this ponzi scheme of funding old infrastructure with new infrastructure fees. Its unfair to new buyers and subsidizing older homeowners.
We also likely need to take a look at the actual fees and costs associated with maintaining our infrastructure. Stormwater ponds, seen typically in subdivisions, are HORRIBLY under-serviced, with a recent investigation in our area revealing 75% of them had never been cleaned out since being put into service ~30-50 years ago. They typically have a service life of 10-20 years, and have been leaking pollutants into our creeks and waterways since. The primary reason - you guessed it, budget. At 1+Mil/cleanout, they’re expensive.
We’ve skated by up till now by externalizing these costs and letting the damages build up for tomorrow’s solutions. We can’t keep putting off those costs.
The cost to replace those is enormous, and IMO, should be covered primarily by property tax and/or useage fees.
Agreed. I’m not sure those are usually covered by development fees. But it sounds like you know more about it than I do.
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You can replace Vancouver for Montreal and you’d have the same thing.
In Montreal we laughed for years at the 1M$ shack or mansions in Vancouver, but now in Montreal an average house is also 1M, it was like 500k 5 years ago. There is something like 3000 empties condos too in Montreal, maybe 10000-12000 airbnb too, and 25-34yo people especially those with spouse/children are leaving Montreal en masse.
It is completely fucked up right now. Rent also doubled. People on minimum wage are making ~2k$/month, an average rent is 2k$/month.
Let’s not talk about an average new car at 65k$ and an average used car at 36k$
Has the province started shutting down those Airbnbs? I thought there was a bunch of media noise about that recently.
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So you’re thinking everyone in low-density suburbs would be better for the climate? (Degrowth is usually a climate thing)
Are you misconstruing my comments on purpose? I said mid density. Also degrowth is not just a climate thing, it’s a sustainable everything thing.
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As around 2,500 condos sit unsold in Metro Vancouver, experts warn of 'potential storm coming' for real estate | CBC News
The Canada Mortgage and Housing Corporation says there’s about 2,500 condos sitting unsold and empty in Metro Vancouver. The local real estate industry is concerned about layoffs and hopes for housing policy changes.
CBC (www.cbc.ca)
Build something cheaper.
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Are you misconstruing my comments on purpose? I said mid density. Also degrowth is not just a climate thing, it’s a sustainable everything thing.
Okay, sure. If you mean townhouses or something, lower density by urban standards, mid density when you consider the countryside exists too. I really, really don’t see how the sustainability of anything benefits from that. You need more roads, more cars, more land and more building materials to house the same number.
If you just mean building the same kind of apartments somewhere else, like in Kamloops or something, you haven’t actually changed anything except more roads and traffic again, because everyone is further from everyone else.
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Build something cheaper.
If you read the article, these are tiny Vancouver apartments already. It sounds like going even smaller and shittier would be illegal currently, which is what’s causing the problem.
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Warning for Vancouver real estate as 2,500 condos sit unsold
So prices will go down, right?
…Prices will go down, right?
Maybe for a bit as those companies go out of business. Then they go way up because there’s no new houses. Or we could solve whatever the underlying problems are.
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If you read the article, these are tiny Vancouver apartments already. It sounds like going even smaller and shittier would be illegal currently, which is what’s causing the problem.
Ahhh, so they’re just charging outrageous prices for already cheap housing.
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The cost to replace those is enormous, and IMO, should be covered primarily by property tax and/or useage fees.
Agreed. I’m not sure those are usually covered by development fees. But it sounds like you know more about it than I do.
Unfortunately some municipalities have used development fees incorporated into their normal budget, whether directly or indirectly, rather than solely using them to account for the increased costs in maintenance, which is what they should be for. Often times I’ve worked on capital projects (repair ones) where the funding has come directly from development.
For example, one municipality I work closely with has the salaries for all their development staff and the salaries for their capital design staff paid by development fees, plus some allocations for expansion of other services to account for more citizens.
Edit for clarity: Municipalities can also skirt this use by doing things like the following: a long stretch of road from a highway is in poor condition and needs to be repaired in the next 2 years. But a development is going in on the road, and they can force the developer to pay for the reconstruction of the road, despite the fact that it is in poor xondition and needs to be redone anyway. Ditto for sewer, or water main replacement.
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Okay, sure. If you mean townhouses or something, lower density by urban standards, mid density when you consider the countryside exists too. I really, really don’t see how the sustainability of anything benefits from that. You need more roads, more cars, more land and more building materials to house the same number.
If you just mean building the same kind of apartments somewhere else, like in Kamloops or something, you haven’t actually changed anything except more roads and traffic again, because everyone is further from everyone else.
Mid density is mid density. No need to confuse thinking by averaging rural into the equation. We could average out across the universe and be at effective zero home per km2. It’s a ridiculous argument, so why bother.
By mid density, I like most urban planners include everything from townhouse and multiplexes all the way up to low rise appt buildings under 5 stories. It’s dense enough to enable urban transit and walkable neighbourhoods but efficient enough to not need elevators and supplementary water pumps to get water up to the top floor.
High rises have nice views when another one isn’t in front of you, but man is it crippled when the power goes out.
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So 50-70 years ago, did they take better care of infrastructure? I’ve seen these kinds of problems make appearances in Alberta, as well, and I always wonder how whatever unsexy bit of infrastructure was funded in the first place, given that it’s so politically costly to do.
Given that I believe growth stagnation is required
In Canadian municipalities specifically, or in general, like for climate reasons?
Lol they definitely did not take better care of infrastructure. They were freaking cowboys and a ton of municipalities got burnt on it. I work on lots of capital jobs that involve fixing problems that have been around since then.
So now they have much more stringent standards, which in turn means projects are more expensive. Add onto that the growing complexity - installing a water main down a street in 1980 when you have overhead hydro lines and no other utilities to work around is much easier than installation in a crowded right-of-way with buried gas, hydro, storm sewer, sanitary sewer, and existing water main that needs to continue to service residents.
As for how they were originally funded, idk. Don’t think they ever really asked residents what they wanted back then. Now there’s much more accountability, which is good but has drawbacks and costs.
In Canadian municipalities specifically, or in general, like for climate reasons?
I mean climate, but not specifically global warming, just the fact were a planet with finite resources.
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This post did not contain any content.
As around 2,500 condos sit unsold in Metro Vancouver, experts warn of 'potential storm coming' for real estate | CBC News
The Canada Mortgage and Housing Corporation says there’s about 2,500 condos sitting unsold and empty in Metro Vancouver. The local real estate industry is concerned about layoffs and hopes for housing policy changes.
CBC (www.cbc.ca)
Negotiate harder with your suppliers?