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Vancouver Real Estate Vancouver builders and buyers survey a post-election housing landscape

Kirsty Barclay and Carol Ann Lang are two faces of Vancouver’s housing nightmare.

The two live in a nearly 90-year-old, three-storey apartment building in the city’s pleasant Kitsilano neighbourhood, paying, they admit, an indisputably low rent of around $1,200 for their roomy one-bedroom apartments – the result of decades of benevolent ownership by a Chinese immigrant family that wasn’t aggressive about raising prices.

Kirsty Barclay speaks with Carol Ann Lang in Vancouver on Oct. 28, 2018.

Jimmy Jeong/The Globe and Mail

But the offshore owner who bought the building last year is now pressuring everyone to move out in advance of what he says will be extensive renovations, offering tenants $3,000 to be on their way and employing a handler who knocks on their doors and follows them to their recycling bins to urge them to take advantage of the offer.

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The complete absence of apartments at anywhere near the same price and quality has Ms. Barclay worried, and Ms. Lang determined not to leave her home of 35 years without a fight.

“I started looking and there’s hardly anything out there,” said Ms. Barclay, who only lucked into the Kitsilano apartment just last year after four years of living in a tiny basement half-suite in east Vancouver at $600 a month. “I couldn’t find anything that wasn’t a ‘scare’ basement.”

Ms. Barclay, a widow in her 50s who makes a reasonable salary in the $80,000 range teaching at the B.C. Institute of Technology, thought about buying a condo, until she saw that condo prices had soared in the area she was looking from $200,000 to $290,000 in the space of 10 months.

That’s the reality for hundreds of renters in Vancouver, Burnaby and other parts of the B.C. Lower Mainland, where there’s a near-zero vacancy rate, housing prices have spiralled up and the extreme shortage of housing has encouraged investors to buy old apartment buildings and renovate them or demolish them, where possible, to get more revenue from refurbished apartments or new condos.

Now, a raft of new councillors have been elected in Metro Vancouver, many of them because they promised to fix housing problems.

In Vancouver and Burnaby, especially, new council members and mayors have promised that they will ensure that there are more low-cost apartments built to be rented to people making average salaries.

Councillors such as the Green Party’s Adriane Carr say that the city needs to ask more from developers in terms of providing low-cost housing.

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“The ask has to be bigger and the expectation is that there is more affordability and more units.”

In other municipalities, such as the District of North Vancouver, Port Moody, White Rock and Port Coquitlam, mayors or councillors have been elected who specifically opposed the pace of development in their communities.

All of that has people in the housing industry, both private and non-profit, bracing for changes ahead.

Builders are warning that new demands from cities to produce more rental apartments at below-market rates could end up resulting in no rentals getting built at all, which they say is the last thing a city with housing shortages needs.

“It’s just getting harder and harder to do these purpose-built rentals,” said Richard Wittstock, a principal at Domus Homes Group. He said between rising construction costs, rental rates, uncertainty about what the NDP government will do next to change the rules around rent control, and continuing onerous municipal processes for approving rentals, it’s difficult to financially justify building even market rentals, let alone find ways to build apartments that could be rented at below-market rates.

“I have three potential deals in front of us right now, but it just doesn’t pencil out,” he said. His company is still going ahead with a rental project in the city of North Vancouver, which he said has maintained a consistent policy on rentals and developer incentives for them.

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Domus Homes

Renderings of a rental building currently under construction by Domus Homes in North Vancouver.

Domus Homes

Some in the development industry are wondering whether they will even be able to get approvals to get rezonings for straight condo projects, which, if not, will reduce housing supply even more if that happens.

But the non-profit housing sector is hoping that there might be new openings for their groups to develop, with the change in the political climate.

“There might be some interesting opportunities for the community housing sector,” B.C. Non-Profit Housing Association chief executive Jill Atkey said.

And Ms. Atkey believes there are some local developers around who will be willing to consider alternatives to their usual models in order to help out.

“They want to meet the housing needs for local communities,” she said.

But the mystery for many, at this point, is what the new councils will actually do.

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No one feels certain what will happen until those new councils go through a few rezoning decisions.

One of the first that appears likely to land in front of Vancouver is the dramatic 535-foot tower being planned by Pinnacle International for a site next to the Granville Bridge, with 303 for-sale condos and 152 social-housing units that are supposed to be turned over to the city.

“So far, Pinnacle is moving along with the project,” said Grace Kwok, a realtor with Anson Realty who is working with the developer.

She said the company has followed all city rules and has a signed agreement on how many social-housing units were going to be required on the site, so she doesn’t believe a new council could alter that.

However, that new council will need to decide what the rents will be for those 152 units.

A city official said that hasn’t been decided in detail yet, although a minimum of 30 per cent of the units will be rented to lower-income households at a rate of 30 per cent of their income. It will be up to councillors to decide if they want to push that further.

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One of the big complaints about housing policy under Mayor Gregor Robertson and Vision Vancouver was that they approved a redefinition of social housing to bring it into line with the way non-profit housing groups have operated since the 1980s.

That meant social housing was no longer a building where every unit was subsidized to some degree, with many units subsidized to the point where people only paid social assistance-level rates, as was the case when public housing was built in North America in the postwar period.

Instead, “social housing” is now a mix of very deeply subsidized units for the extremely poor, lightly subsidized units for people who have jobs but not well-paid ones and non-subsidized units rented to anyone willing to live in a social-housing building.

In some of the projects Vancouver has approved in recent years, there’s been an even three-way split between those three types. A Wall Development project on East Hastings, for example, included 70 units of social housing allocated on that model.

But in other projects, far less than one-third has been designated for heavy subsidies.

The new council could insist on much lower rents for the Pinnacle’s 152 units, which would require a bigger commitment of city money.

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It’s also unclear whether the new, progressive majority on council will insist that Pinnacle try to integrate the two buildings, instead of having separate doors and amenities – something that some of the newly elected councillors have criticized in the past.

However, that is a better situation than some projects might be facing, where the developers have until now not been required to include any below-market housing at all.

Builders who work in Burnaby are also waiting to see what the new mayor-elect, Mike Hurley, will be asking of them. Just before the election, city council rescinded approval for two major projects, saying they needed more rental units.

Mr. Hurley promised he would stop demolitions of older, cheaper apartments in Burnaby – a phenomenon that has stirred controversy there for the past three years – until developers come up with a promise to house any of the former tenants in new units at the same price as the old rentals.

One of the major developers in the city said he is waiting to see what’s next.

“Our approach is to assess … and make adjustments. But sometimes adjustment can be too difficult or too onerous,” said Rob Blackwell, the senior vice-president of development at Anthem Properties, the company that had two of its projects put on hold.

He’s not concerned about Surrey, where mayor-elect Doug McCallum has promised to “put a pause” on development and focus on what he calls “smart growth” around transit. That’s because Anthem’s project in Surrey is already the kind of thing Mr. McCallum wants – lots of density near the SkyTrain line and less in Surrey’s bucolic single-family areas.

But, in Burnaby, Mr. Blackwell is waiting to talk to the new mayor. He’s hopeful Mr. Hurley will be open to suggestions.

“When everyone’s working together, which is how we do things, we can generally come up with good solutions.”

But Mr. Blackwell is still concerned that, between changes in councils’ policies and the difficult climate for building anything these days, there will be unintended consequences.

“It could mean less being built and a reduction in the building supply.”

Renters such as Ms. Barclay are hoping everyone can work things out.

“We need more rental properties and make it so people pay only a quarter of their income,” she said. “This problem is so extreme right now that chipping away and fighting all fronts, it’s worth experimenting with.”

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