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Without affordable housing, Vancouver risks becoming an economic ghost town

business.financialpost.com

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Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#71

Post by pjc50 »

jseliger wrote: post #42
cdnsteve wrote: post #19

Vancouver real-estate is like buying gold for foreign investors, without paying tax. "suggesting the typical wealthy foreign family buying Vancouver real estate pays little or no income or capital gains tax" http://www.theglobeandmail.com/report-on-business/economy/ho...

This is the best response I've seen so far. Real estate is actually a great export for cities and countries, at least properly considered: http://www.slate.com/articles/business/billion_to_one/2013/1... . Seattle has a bunch of similar articles about "outsiders" supposedly driving up housing costs. Which is absurd: steel frame construction and elevators are very old technologies that allow humans to build just about…

Housing cost has very little to do with construction and everything to do with location.

Real estate as an export is .. well, it's a response to circumstances, I suppose, but is it really sustainable? After all, you can't just make more land with the property "within 1km of Central Park".

What happens when the majority of a city is owned by foreign landlords? Do you think that might distort its politics?

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#72

Post by iheartmemcache »

ghaff wrote: post #58
tetraodonpuffer wrote: post #48

sure, you can't buy a house in Vancouver anymore on a normal salary, but nothing prevents you from living in Surrey, there are plenty of towers going up around the skytrain at Surrey central and King George where you can get an apartment for less than 200k Yes, it's not Vancouver city, and yes, it's not a house, however via skytrain you can be downtown in a little over 40 minutes and get work done on your laptop in t…

This sort of thing is true broadly. It's a bit more complicated in California because the South Bay is also very popular and very expensive, but the trendy areas of many downtowns have, over a relatively short period, become very popular with, among others, a certain young & educated demographic that really has turned them into luxury goods. This has arguably long been the case in some places like Manhattan. Going ba…

That 495 tech belt thing was because office park space was so cheap and having 75,000 sqft was required back during the Sun and Digital days. No one really chose to live out there after graduating for college, and if they did move out there it was either reluctantly for a shorter commute or because employees were further on in life (e.g. 30-somethings then would consider suburbia ideal; in my late 20s, early 30s now very few people want to live outside of major cities, opt for public transportation over having cars, etc). Now Central Square is gentrified enough to the point where a heroin junkie won't rob you at at 9PM, and at least amongst my friends, the young & educated (both in the sciences and the liberal arts) either chose to stay in the city post-college (or move out to a comparable city).

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#73

Post by GFischer »

ajmurmann wrote: post #54

I wonder how much of this and similar cases are based on low interests. You can't keep your money in the bank because you won't get any interests and at the same time leveraging your money and buying housing is cheaper. So maybe the solution to housing prices is significantly higher interest rates?

I think that's one of the causes, the other is the excessive money supply:

https://positivemoney.org/issues/house-prices/

The issue described is not unique to Vancouver, it's a worldwide phenomenon, lots of desirable locations across the globe are facing the same (from Auckland to London to Sydney to Zurich), even in my hometown in Montevideo, Uruguay, houses are going for ridiculous prices.

A good measure on whether housing is overvalued (IMO) is how many salaries it takes to buy a house. A good salaries to house ratio was something like 4 yearly salaries, it's currently over 10 for England, with some places going to 20 yearly salaries for a house:

http://www.theguardian.com/money/2015/aug/06/average-house-p...

As someone who doesn't own any property, I really hope the housing bubble explodes. OTOH there are people who have gotten very wealthy just by inheriting and holding property, who must dread the same scenario, but where can they safely store their value? As mentioned, interest rates are very low or negative.

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#74

Post by hvmonk »

Yeah, investors are all around in Bay area too. They are making the real estate market crazy. I have witnessed more than 15 offers on ordinary properties in South Bay, and well, they are selling far more than the listed price. All these investors pay all-cash, money gifted from other side of the globe. It doesn't matter where you work, how much is your salary - you can't beat these investors.

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#75

Post by ido »

rgoldade wrote: post #56
jseliger wrote: post #42

Earlier quoted context omitted.

This is the best response I've seen so far. Real estate is actually a great export for cities and countries, at least properly considered: http://www.slate.com/articles/business/billion_to_one/2013/1... . Seattle has a bunch of similar articles about "outsiders" supposedly driving up housing costs. Which is absurd: steel frame construction and elevators are very old technologies that allow humans to build just about…

I'm not sure if you're familiar with Vancouver but outside of the small downtown core, there isn't much zoning for density. Government policy has created a supply shortage. However, condos come with their own issues as well. There has been a building boom in Toronto that has it owns issues.. http://www.cbc.ca/news/canada/toronto/fears-that-shoddy-toro... . I think urban planning is more complicated than simply increa…

And yet 100% of major US cities that built a lot of housing between 1990 and 2013 have low housing costs:

http://www.spur.org/sites/default/files/wysiwyg/asking.price...

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#77

Post by merpnderp »

api_or_ipa wrote: post #55

As someone who just moved from Vancouver to the Bay Area, it's obvious the issue isn't housing. It's income. My apartment in trendy yaletown was $2350/month for a very nice 2 bed, 2 bath place within 10 mins of anything in downtown. Try finding something even remotely as nice around Silicon Valley. The issue we should be tackling is the low wages seen in the area. The same developer who could make $100k USD in the va…

Vancouver salaries seem exceptionally low. I live in the middle of nowhere USA, and devs start out at from school over $60k USD, and I live on an acre in a 3 bed 3 bath, 6 minutes from downtown and 4 minutes from work. At $2350/month my house would have been paid off in 5 years.

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#78

Post by theworstshill »

Meh... article is pushed by special interest groups. Their concerns could be addressed very quickly by raising their employees salaries. Especially since vast majority of companies sell services to the US, and get more CADs than before with the current exchange rate.

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#79

Post by alwaysAttending »

api_or_ipa wrote: post #55

As someone who just moved from Vancouver to the Bay Area, it's obvious the issue isn't housing. It's income. My apartment in trendy yaletown was $2350/month for a very nice 2 bed, 2 bath place within 10 mins of anything in downtown. Try finding something even remotely as nice around Silicon Valley. The issue we should be tackling is the low wages seen in the area. The same developer who could make $100k USD in the va…

San Francisco housing is expensive BECAUSE of the incomes. Vancouver housing is expensive DESPITE the incomes. It's more of a housing issue than an income one. If incomes were higher, rents would only go up as well.

Re: Without affordable housing, Vancouver risks becoming an economic ghost town

#80

Post by fiblye »

api_or_ipa wrote: post #55

As someone who just moved from Vancouver to the Bay Area, it's obvious the issue isn't housing. It's income. My apartment in trendy yaletown was $2350/month for a very nice 2 bed, 2 bath place within 10 mins of anything in downtown. Try finding something even remotely as nice around Silicon Valley. The issue we should be tackling is the low wages seen in the area. The same developer who could make $100k USD in the va…

The problem there is the >90% of people in Vancouver who aren't in high paying tech fields. It's pretty difficult to say "just triple their wages and they'll afford houses no problem."

The real issue is property owners know someone will eventually come along and pay whatever they're asking. If wages were to dramatically increase, they'd never stop and think, "Yeah, I think I'll cap rent at $3000/month because I'm a nice guy." They'll gladly take $4000 if they can and never settle for less once they hit that point. Instead of considering lowering rents, they'll ask why you just don't get paid more.

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