Vancouver Rental Market Discussion

[whatnext]

Originally Posted by Changing City

It's not clear that the funds mentioned are the sole source of finances. The projects all receive $100,000 per unit, irrespective of where they are (in the Lower Mainland), so it's unlikely to be the entire cost.

Is there Federal money involved as well? Regardless, good news!

[SpongeG]

Landlords the winners as Metro Vancouver housing sales slump

By Frank O'Brien, Western Investor | November 26, 2018


This 19-unit Vancouver rental apartment building sold recently for nearly $500,000 per unit: demand for rentals is expected to stay hot as overall Metro housing sales cool. | NAI Commercial

With a near free-fall in Metro Vancouver, British Columbia housing sales will plunge 23 per cent this year, according to the BC Real Estate Association (BCREA), and the projected 2019 recovery will be led by centres outside of the Lower Mainland, particularly in the Kamloops region and the north.

In Metro Vancouver, the real winners in 2019 will be existing residential landlords who can expect high demand, less competition and low vacancy rates, based on Western Investor's analysis for its annual residential investment outlook.

...



...

https://biv.com/article/2018/11/land...sYwEtzsPZj7ZKQ

[whatnext]

Interesting, are these flips the buyer are bailing on? Trying to get out before bare trust owners are exposed?

One might think that it’s almost impossible to find a rental place given the low vacancy rates in Vancouver.

But it seems that there are some apartment buildings that are sitting almost empty.

Landsdowne House in the West End is an example. Out of the apartment building’s 24 suites, 17 are vacant. Moreover, the entire property at 1537 Burnaby Street is for sale.

According to a listing by HQ Commercial, Landsdowne House is priced at $10.8 million.

The listing notes that a buyer would have the chance to do a major renovation project for the 17 vacant suites.

“Landsdowne House is extraordinarily well located mid-block on Burnaby Street between Cardero and Nicola Streets,” the listing states. “Davie Street, only one block away, is a popular pedestrian shopping area considered ‘the main drag’ of the neighbourhood.”

The three-storey plus penthouse building was constructed in 1956.

The property is “held in a bare trust”, according to the listing...
https://www.straight.com/news/117057...ed-108-million

[s211]

One of the dirty little-known secrets in the West Side rental market is the number of units rented by people that actually live elsewhere in the Lower Mainland (mostly East Van), just so their kids can go to a West Side school, and never actually occupy the unit. A few years ago, a property manager disclosed to me the proportion of such units in their building, and while the number now escapes me, I recall it being appallingly high.

[misher]

Originally Posted by whatnext

Interesting, are these flips the buyer are bailing on? Trying to get out before bare trust owners are exposed?

Rather than exposed I think most people just don’t want people to know how much they have. It’s basic privacy similar to how you don’t make public what’s in your bank account. Or how many stocks you own. Or your criminal record. Once people know you have money family and friends treat you differently and it sucks. It can also get quite dangerous. I’m ok with the government knowing who owns what but definitely not the common public. I can’t think of any benefit to disclosing who owns what to the common person. If someone doesn't want to show off their wealth I think they should have a right to privacy. Let me know if I'm missing a benefit to disclosing someones wealth to the general public.

[fredinno]

Originally Posted by misher

Rather than exposed I think most people just don’t want people to know how much they have. It’s basic privacy similar to how you don’t make public what’s in your bank account. Or how many stocks you own. Or your criminal record. Once people know you have money family and friends treat you differently and it sucks. It can also get quite dangerous. I’m ok with the government knowing who owns what but definitely not the common public. I can’t think of any benefit to disclosing who owns what to the common person. If someone doesn't want to show off their wealth I think they should have a right to privacy. Let me know if I'm missing a benefit to disclosing someones wealth to the general public.

The argument goes that it would expose wealth gained from shady means.

I still don't like it though, it still feels like a privacy violation.

Originally Posted by s211

One of the dirty little-known secrets in the West Side rental market is the number of units rented by people that actually live elsewhere in the Lower Mainland (mostly East Van), just so their kids can go to a West Side school, and never actually occupy the unit. A few years ago, a property manager disclosed to me the proportion of such units in their building, and while the number now escapes me, I recall it being appallingly high.

Hmm.

Is there a reason schools generally only allow people from a certain catchment area in Vancouver?

I don't remember that being a problem in Langley, but that was some time ago.

[SpongeG]

I don't know the reason but I knew someone who went to high school in Burnaby and his family moved to Coquitlam just before grade 12 and he had to get permission to finish school in Burnaby with his friends and where he had gone for all his schooling.

I think its probably a way to help control the amount of students at any particular school.

[Tetsuo]

The school boards are so strict with catchment, except when it comes to a trouble student (I remember on the west side, we'd have people kicked out of Gladstone/DT/JO sent to us, and our school was packed)

[WarrenC12]

Public ownership records are common in many areas of the US. I don't think they are necessarily a bad thing.

I'd argue they solve more problems than they cause.

[scryer]

Originally Posted by WarrenC12

Public ownership records are common in many areas of the US. I don't think they are necessarily a bad thing.

I'd argue they solve more problems than they cause.

Well they would certainly solve more problems in Vancouver at this point.

Prepare folks, things are going to get a lot worse before they get better.

[SpongeG]

Multi-family rental market booms as demand chases short supply

Nearly $3 billion of Metro Vancouver purpose-built rental properties exchanged hands last year, finds report

Peter Mitham / Business in Vancouver
JANUARY 23, 2019

Close to $3 billion worth of purpose-built rental properties changed hands in Greater Vancouver last year, according to the numbers crunched by the Goodman team at HQ Commercial.

The sum represents a 37% increase from last year, even though the number of properties changing hands totalled 155, just five more than in 2017. The average price per suite increased 23%, to $530,401.

“The real story behind the stats is all about the dirt,” Mark Goodman said. “The rarity of land throughout Metro Vancouver, coupled with investment growth in the condo and rental sphere, continues to drive our markets.”

While strong demand for rental accommodation allowed investors to enjoy good cash flow in the past, the motivation today is increasingly about redevelopment opportunities. Supply can’t keep up with demand, and an aging stock suited to redevelopment in rental-friendly municipalities means many properties’ land values have risen – in some cases, Goodman said, “almost beyond recognition.”

Deals in the West End, for example, broke the billion-dollar mark as 21 buildings comprising a total of 1,373 suites sold.

The strong activity put paid to mid-year analyses that saw a slowing market for multi-family properties.

...

https://www.vancourier.com/real-esta...ply-1.23609894

[fredinno]

Originally Posted by SpongeG

Multi-family rental market booms as demand chases short supply

Nearly $3 billion of Metro Vancouver purpose-built rental properties exchanged hands last year, finds report

Peter Mitham / Business in Vancouver
JANUARY 23, 2019

Close to $3 billion worth of purpose-built rental properties changed hands in Greater Vancouver last year, according to the numbers crunched by the Goodman team at HQ Commercial.

The sum represents a 37% increase from last year, even though the number of properties changing hands totalled 155, just five more than in 2017. The average price per suite increased 23%, to $530,401.

“The real story behind the stats is all about the dirt,” Mark Goodman said. “The rarity of land throughout Metro Vancouver, coupled with investment growth in the condo and rental sphere, continues to drive our markets.”

While strong demand for rental accommodation allowed investors to enjoy good cash flow in the past, the motivation today is increasingly about redevelopment opportunities. Supply can’t keep up with demand, and an aging stock suited to redevelopment in rental-friendly municipalities means many properties’ land values have risen – in some cases, Goodman said, “almost beyond recognition.”

Deals in the West End, for example, broke the billion-dollar mark as 21 buildings comprising a total of 1,373 suites sold.

The strong activity put paid to mid-year analyses that saw a slowing market for multi-family properties.

...

https://www.vancourier.com/real-esta...ply-1.23609894

Instead of taxpayer-funded rental supply increases, they should issue rental construction as an in-kind CAC, allowing more rental for upzoning or slight viewcone penetration.

Would save everyone money on the long run, and the COV can still claim they helped solve the rental crisis.

[GenWhy?]

Originally Posted by fredinno

Instead of taxpayer-funded rental supply increases, they should issue rental construction as an in-kind CAC, allowing more rental for upzoning or slight viewcone penetration.

Would save everyone money on the long run, and the COV can still claim they helped solve the rental crisis.

Explain.

[Changing City]

Originally Posted by fredinno

Instead of taxpayer-funded rental supply increases, they should issue rental construction as an in-kind CAC, allowing more rental for upzoning or slight viewcone penetration.

Would save everyone money on the long run, and the COV can still claim they helped solve the rental crisis.

You don't seem to understand the breadth of the City of Vancouver rental programs. You can read about them here.

The Moderate Income Rental Housing Pilot Program encourages development proposals for new buildings where: 100% of the residential floor area is secured rental housing and at least 20% of the residential floor area is made available to moderate income households earning $30,000 to $80,000 per year. Eligible City incentives for Moderate Income Rental Housing projects include: additional height and density beyond what is available under existing zoning, Development Cost Levy (DCL) waiver (and no Community Amenity Contribution either), parking requirement reductions, relaxation of minimum unit size and configuration requirements and expedited processing.

The Rental 100: Secured Market Rental Housing Policy encourages the development of projects where 100 per cent of the residential units are rental. The policy targets moderate income households, and in intended to help the City reach its goal of creating 5,000 new units of market rental housing by 2021. Most of the incentives are similar to those listed above, including not charging DCLs or CACs.

Those are in addition to where the City is providing land for non-market supportive housing, and temporary modular housing. The Metro Vancouver Housing Data Book shows that the City of Vancouver has seen nearly 10,000 rental units started from 2012 to 2017 - nearly half the entire regional total. You can also see that while there's a net gain in the CMHC inventory of purpose-built market rental in Vancouver of over 2,000 units in 10 years, which is over half the rental units added to Metro Vancouver, there's a net loss of 685 units in Burnaby. (That CMHC data excludes suites and non-market housing, it includes purely market rental buildings).

The City of Vancouver is trying to add short term, non-market, affordable and market rental units across the city. It also protects most of the existing stock of rental units from conversion or demolition for condos. It looks as if Burnaby will change course and take the need for rental seriously too, but a lot of damage has been done to the total stock of rentals. If other municipalities were engaged in adding more rental stock as much as the City of Vancouver, the situation might improve faster.

[GenWhy?]

Thanks Changing for the follow up.

Quick recent example of the MIRHP Program: https://www.straight.com/news/119155...income-earners

Best part is the comment section.

[misher]

Originally Posted by fredinno

Instead of taxpayer-funded rental supply increases, they should issue rental construction as an in-kind CAC, allowing more rental for upzoning or slight viewcone penetration.

Would save everyone money on the long run, and the COV can still claim they helped solve the rental crisis.

We do have programs like this and they do get used. However it feels like they just aren't enough to offset the slower ROI (if a positive ROI still exists) on rentals. Rental rates are rising faster than land values now so perhaps rent will go up high enough to make the ROI very attractive again. Multi Family Commercial purchases have gone up and I suspect some are because they are speculating rents will increase fast due to the recent push on residential demand.

[Changing City]

Here's an update on the current Vancouver Council's attitude to Rental 100, and its 'affordable' rentals. There were two projects decided at the first Public Hearing into rezonings (last week). Both will be 6-storey over retail on East Hastings. There was local opposition to both projects, and Councillor Swanson voted against both of them because they weren't affordable enough. Despite that, both were approved, although one project had Councillor Boyle also opposing, and Councillor Fry abstaining. It's pretty clear that these were supported because they were submitted a while ago under policy (and bylaws) approved by earlier Councils. Some members of the new Council are looking at 'deepening' affordability in future - although there's no indication yet of how that'll be possible, or whether it'll just not be worthwhile for developers to bother to build - or at least in the numbers needed to meet demand.

[SpongeG]

In Coquitlam from what I have seen or in new proposals, when they are eliminating rental buildings for new developments they are required to replace the rentals and include more rentals than before. I don't know if the same is required when they demolish SFH as they are in Burquitlam/Lougheed area to include rentals but at least they have some rental rules in place which Burnaby hasn't had when it comes to developments at least in the metrotown area. That said Coquitlam is constructing it's first rental building in 40 years, which seems to be about the same for most of the Lower Mainland, rental buildings were just not being built for too long.

[SpongeG]

Housing Matters podcast: Fixes for Metro Vancouver's rental accommodation shortage

Housing Matters host Stuart McNish speaks with UBC professor Tom Davidoff, Vancouver Coun. Jean Swanson, and Hani Lammam of Cressey Development Group about strategies to build more rental accommodation in Metro Vancouver.

THE VANCOUVER SUN Updated: February 12, 2019

The latest episode of the Housing Matters podcast is all about finding ways to build more rental accommodation in Metro Vancouver where land costs are sky high and vacancy rates near zero.

Here are five things we learned from this week’s podcast:

Tom Davidoff, a UBC professor at the Sauder School of Business, says special buildings with below market rents for the lucky few who win a lottery to get in will not be enough. “Another approach is to say everybody who is eligible for that lottery is going to get an equal prize. They’re going to get a cheque and instead of this being a government-built building, this is gonna be a market-built building where you can take your cheques and put them.

...

https://vancouversun.com/news/local-...ation-shortage

[Klazu]

When people write "luxury apartment" on Craigslist, they mean business. Just look at this beautiful luxury penthouse in heart of Yaletown - where all the action is - for just $5,000/month. Mmm-mm, that is one swanky looking kitchen and I love what they have done with the bathroom! If those walls (or that carpet) could talk, the stories they would have!!

https://vancouver.craigslist.org/van...817190132.html