An avalanche of money
An expert on how income disparities are reshaping Canada's metropolitan areas zeroes in on Vancouver
The maps are dramatic, and show a remarkable trend under way: A landslide of wealth is flowing eastward across Vancouver, pushing low-income groups to the fringes of the city and into the suburbs. Burnaby, Richmond and Surrey – places that used to symbolize a comfortable, middle class existence – now show the highest concentrations of low-income households.
It's what everybody in Metro Vancouver is already experiencing at some level. And now, we have the data to illustrate the transition, and a mother lode of maps and charts.
University of Toronto professor David Hulchanski, who is the principal investigator of the Neighbourhood Change Research Partnership, says the exhaustive research examined the past 45 years of Canadian neighbourhood incomes. Using census data, the team is releasing its Vancouver data here for the first time.
In terms of inequality, Vancouver joins the club with Calgary, Toronto and Montreal as cities where the gap between rich and poor is widening. As a result, major cities are transforming. Dr. Hulchanski spoke on the topic at Simon Fraser University last week, as part of the annual Warren Gill lecture series.
"It is a fact that, since the 1990s, for Canada, we are more unequal – the income gap is larger, and there is more polarization," Dr. Hulchanski said in an interview. Polarization is when there are more high income and low-income people, and fewer people in the middle.
"This research is simply now showing where it lives."
Dr. Hulchanski is a leader in research on how income disparities are reshaping Canada's metropolitan areas. His "Three Cities" report on Toronto had surprised that city when he found a mostly rich urban core, a shrinking middle class, and increasing poverty throughout many suburbs. Vancouver is following a similar pattern, but for different reasons. Unlike Toronto, Vancouver doesn't have the high-paying jobs to drive its economy. Instead, the city relies largely on an inflow of foreign money to fuel its real estate industry. That reliance has put communities at a disadvantage, widening the gap between the haves and have-nots. The Neighbourhood Change maps and graphs show that gap in full colour.
Vancouver's low-income communities have receded: in 2000, almost half, or 48 per cent, of neighbourhoods were low income, while today 26 per cent of the city falls into that category. Meanwhile, the wealthier communities have grown in number, to 33 per cent of the city from 25 per cent. Gentrification is well under way.
"The city's population is increasing, as this shows, and over time, low income neighbourhoods, low income people, are being pushed out of the City of Vancouver and into other places," says Dr. Hulchanski.
The research is based on census data from 1970 to 2015, as part of a long-term project funded by the Social Sciences and Humanities Research Council. The Vancouver area has 460 census tracts, which were used by the team to map out household and individual incomes. A census tract typically represents about 5,000 people.
The data show that wealthy enclaves are creeping eastward across the city of Vancouver, with middle-class gentrification nibbling around the edges of the traditionally low-income inner city neighbourhoods, including the downtown eastside, Gastown, Chinatown, Strathcona, Grandview-Woodland and Mount Pleasant.
We are seeing profound implications at street level, such as massive tax hikes on small downtown businesses and skyrocketing apartment rents – a crisis for a city whose renters make up half the population. And we see long-time communities battling it out to survive amid rezonings for more density, and the redevelopment that follows. We see an increase in homelessness, and people who are living on the brink of homelessness, desperate for social housing.
"If you look at the city itself, you actually see that every inner city neighbourhood is trending upwards [in incomes], including the downtown eastside," says University of B.C. geography professor David Ley, an expert in immigration and housing markets. He heads up the Vancouver research team, and he focused on 35 years back to 1980, when the region started to rapidly change, with condos replacing rental apartments, and the first wave of wealthy Asian migrants started to move into the housing market.
Increased housing redevelopment has contributed to growing displacement.
"Because every time redevelopment occurs you get a substantial increase in the socio economic status of occupants … [market-rate] supply is only for high-income people. So, whenever redevelopment occurs, it means higher income people are occupying the space," says Dr. Ley. "Two things are happening: there is gentrification in the inner city, but then there's what I call 'capital deepening,' which is an area that is becoming richer."
West Vancouver and the west side of Vancouver, for example, are a sea of dark blue, the colour for "very high" individual incomes, those people who earn 140 to 463 per cent more than $46,821 – the average individual income throughout the census metropolitan area. Delta and White Rock have also made significant income gains.
North Vancouver has maintained a solid half/half mix of middle-income and high-income neighbourhoods over 35 years, with a negligible 3 per cent increase in low-income areas.
Dr. Ley says the trend of gentrification started around 1970, in Kitsilano and the West End, and has worked its way downtown, into Strathcona and the downtown eastside. Residents of traditionally low-income industrial areas are pushed outside the city.
Their relocation to elsewhere in the region, as well as the influx of new immigrants to the more affordable suburbs, has transformed Metro Vancouver.
And the suburbs are where the really dramatic changes are unfolding, Dr. Ley says.
"The suburbs today are far, far different from the 50s and 60s image of the white, middle-class homogenous suburb; the suburb of single-family dwellings and middle class people," he says. "Surrey has the largest number of low-income census tracts now."
He emphasizes that these are big picture trends. There are still low-income groups living throughout the downtown eastside, where they are connected to established social service providers. As well, there are many middle class neighbourhoods in Surrey. But the trends are remarkable.
Since 2000, Surrey's low-income communities have grown by 25 per cent; Burnaby's by 19 per cent; Richmond's by 20 per cent. Richmond, he says, could be an anomaly since there are multimillion-dollar homes in single-family tracts that could indicate under-reporting of global income. Census data is based on declared income, not wealth.
Dr. Ley also points to the finding that 37 per cent of neighbourhoods over all have declined in income, compared with the regional average. Clearly, this is not a demographic that can support expensive housing. "More have actually declined than have increased or have stayed stable."
The danger in such a trend is that a region with dramatic inequality leads to segregation, ghettoization and growing feelings of frustration and resentment. We've seen this scenario play out in European cities, and the social unrest that follows. Low-income people who rely on transit more than any other income group are being pushed further away from it, which makes day-to-day life more difficult. How can anyone get off on the right foot if it takes an hour and a half to get to work and back again?
As for solutions, it won't be easy at this late juncture. Dr. Ley says the government's ongoing position that rampant market rate development will address the crisis has worsened the situation.
"The wide-open supply argument has been thoroughly tested and it's been found wanting," he says. "The problem has simply been aggravated. I think now, finally, people are recognizing that supply is not a problem solver, but in fact a problem generator because it is pricing up land all the time."
As for the city's new housing strategy, which acknowledges that unabated development is not a solution, Dr. Ley says it's a start.
"I wish the city of Vancouver had held this position a decade ago. I cannot quite understand why what is obvious to most Vancouver residents has taken so long to become the policy position at city hall. Anyway, thank goodness it is now.
"I've been saying exactly what [planning director] Gil Kelley said, 'there is no silver bullet that is going to solve the problem.' The best we can do at this point is to mitigate, to try to make sure the problem doesn't get worse, and make what changes we can. And all three levels of government have to be involved in that.
"It may require some extraordinary thinking outside the box."