Canada's 'housing bubble' deemed close to bursting

[WhipperSnapper]

Originally Posted by LeftCoaster

Do you honestly not understand the difference between absolute and relative?

I specifically said absolute. Per capita means nothing here.

Calgary added 49,000 people in 2013, Vancouver added 34,000 in 2013.

Yet despite Calgary growing faster in absolute AND relative terms Vancouver still added twice the multifamily. The fact that the city is twice the size doesn't matter when they're both growing at the same absolute rate, or the smaller one is growing faster!

See why you're wrong yet?


Ahh so this is that much discussed maturity you've been going on about. So nice of you to show all of us how a mature person acts.

Thanks. I was curious about those. I think that is still probably the best measurement without getting completely lost in data and despite geotag pointing out an obvious deficiency with respect to babies. Population and per capita takes into account already housed people. That really has nothing to do with the discussion. Affordability doesn't account for much either as multifamily is inherently more expensive to construct and Vancouver, in particular, is in the midst of a real estate investment boom with super inflated market values. It's almost the same situation in Calgary with the speculation and stockpiling of office space for future needs. Gross lease rates were crazy high.

[LeftCoaster]

Originally Posted by WhipperSnapper

Thanks. I was curious about those. I think that is still probably the best measurement without getting completely lost in data and despite geotag pointing out an obvious deficiency with respect to babies. Population and per capita takes into account already housed people. That really has nothing to do with the discussion. Affordability doesn't account for much either as multifamily is inherently more expensive to construct and Vancouver, in particular, is in the midst of a real estate investment boom with super inflated market values. It's almost the same situation in Calgary with the speculation and stockpiling of office space for future needs. Gross lease rates were crazy high.

Yeah, the ratio seems to make sense. It's not the be all end all but it tells a compelling story of where new residents are being housed.

When I've got more time I'll run the numbers for the other major Canadian metros. It's an interesting data point to have some fun with.

[geotag277]

Originally Posted by LeftCoaster

Sure I agree larger cities should grow multifamily at a faster rate than smaller cities.

So let's create a ratio:

Of the 34,000 residents added in 2013 there were ~20,000 multifamily units U/C. That is the vast bulk. Of the 49,000 residents added to Calgary in 2013 there were only 9,000 multifamily U/C.

That's 0.59 multi family units for each new resident in Vancouver and only 0.18 in Calgary. That means the ratio of new multifamily to new resident is triple in Vancouver than Calgary. That is astounding.

The ratio of multi family units to resident added is so much higher in Vancouver I just can't comprehend how anyone could say it should be even higher, or that it is a shameful level of growth. On the contrary I'd say it is commendably high.

Again, this is totally ignoring the fact that Vancouver is already 2x the size of Calgary, which I think is important. Like CanSpice was alluding to, looking at these numbers in a vacuum causes incorrect conclusions.

Consider a city of 0 growing to 50,000 in the middle of the prairies. It would be a given that would be almost entirely single family detached housing, and that's ok. There are factors involved, such as getting people to settle into that place, and so on. Perhaps they built 5,000 multifamily, having a very poor "means ratio" in your calculation here, but 5,000 multifamily in that context is generally phenomenally good urban planning.

At the end of the data, the data is out there, it's not hard to put it together. I don't agree with WhipperSnapper that we would easily get lost in data here. The components of growth should all be easily accessible (interprovincial, natural increase, etc.) and we can just stack it up against multi family components.

One thing that I think Vancouver also fails on, is building too many towers and not enough low rise. I would argue towers and high rises are actually very poor options for city development in general, as they are limited options, usually very expensive, and so on. So while Vancouver's numbers might be padded disproportionately with towers, Calgary puts it to shame in low rise density as well.

(As an aside, it's fun to make these statements and have other people do the research for you, or as I call it, the lio technique).

[Pinion]

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[dleung]

Originally Posted by Nouvellecosse

Vancouver isn't nearly as dense in its central areas as the density-leading high-HDI cities such as Paris, NYC, Barcelona or even SF. However, it's far more dense both in terms of city and metro area than many similar high-HDI cities, particularly those in NA and Australia. Therefore, in its context as a new medium-sized city in NA, it's doing comparatively well and that should be recognized. But it's far from reaching absolutely maximum achievable - or even maximum desirable - density. And that should also be recognized. In no way do those two facts counter one another and there's no reason they can't be both recognized without conflict.

Exactly. Can the rest of you plz stop talking past each other!??

My thoughts: Vancouver is no doubt building a lot, and the proportion of suburban multi-family is unrivaled in North America. But it's nowhere near "maximum potential", which is a shame since a lot of new development is cramming in density at the expense of architecture, on the few developable sites that exist, when so much more density could be spread out throughout the central city.

[dreambrother808]

Shame, embarrassment? When you speak in such ridiculous hyperbole about housing stats you’re asking for rebuke. When the rebuke comes how can you protest against that which you have evoked?

Nobody wins these silly games, especially when they are built on shaky foundations. Each city is struggling with their own issues. Get over the need to “win” imaginary competitions.

[geotag277]

Originally Posted by dleung

Can the rest of you plz stop talking past each other!??

Totally agree

Here's hoping Eby is working behind the scenes closely with the Federal government on a foreign buyer ban. At least that's what we can all hope is happening.

[mistercorporate]

Is everyone on this board going through menopause at the same time this week?? Did you synchronize your cycles? All I hear is cat fights in every thread...I want to hear about bubbles and supertalls gaddammit!

[lio45]

Originally Posted by geotag277

(As an aside, it's fun to make these statements and have other people do the research for you, or as I call it, the lio technique).

Fair enough as long as you're clearly stating you're not sure of what you're saying that time, every time you do it. Sometimes (often...) I know what I'm talking about, but sometimes I will emit some hypothesis that makes sense at first sight, on topics I'm no expert in. Works generally well as long as the participants in the discussion are intellectually honest.

I spend enough time on SSP as it is, surely you don't think I should do my research myself on top of it......

[milomilo]

Originally Posted by geotag277

One thing that I think Vancouver also fails on, is building too many towers and not enough low rise. I would argue towers and high rises are actually very poor options for city development in general, as they are limited options, usually very expensive, and so on. So while Vancouver's numbers might be padded disproportionately with towers, Calgary puts it to shame in low rise density as well.

Does it? You seem to be describing a different Calgary than the one I live in. We have good on paper density in the new suburbs, but they are soul crushing places fit for the ugly Canada thread. And then in the Beltline we have entirely highrises being built, which I agree are not great for actually giving affordable options. In between, there is expensive infill which barely increases density (and definitely isn't affordable), and a very limited amount of the low/midrise developments that we actually need.

[geotag277]

I was wondering when someone from Calgary would chime in. Calgary actually does decently well for mid-rise, refer to table 2 here:

http://www12.statcan.gc.ca/census-recensement/2016/as-sa/98-200-x/2016005/98-200-x2016005-eng.cfm

It's true, mid rise/infill recent developments in Calgary tend to be very boutique and expensive. So you tend to have expensive towers with limited options, or boutique infills/midrises which are even more expensive (marda loop, kensington, etc.).

Agreed about new density focused suburbs in Calgary. So far from the city, lack of amenities, terrible traffic, and typical multi-family limitations with housing flexibility. Essentially the worst of all worlds.

[dleung]

I don't know why you keep harping on how expensive towers are. Developers love building towers because they can pile on more density, and divide the land cost over more owners, and incidentally sell each unit at a more affordable price. The days of <5 FSR Vancouver towers (against which mid-rises are competitive density-wise) - from back before affordability became the catch-all excuse for all manner of abominations like the one below - are over:


pic by Feathered Friend

[milomilo]

Originally Posted by geotag277

I was wondering when someone from Calgary would chime in. Calgary actually does decently well for mid-rise, refer to table 2 here:

http://www12.statcan.gc.ca/census-recensement/2016/as-sa/98-200-x/2016005/98-200-x2016005-eng.cfm

It's true, mid rise/infill recent developments in Calgary tend to be very boutique and expensive. So you tend to have expensive towers with limited options, or boutique infills/midrises which are even more expensive (marda loop, kensington, etc.).

Agreed about new density focused suburbs in Calgary. So far from the city, lack of amenities, terrible traffic, and typical multi-family limitations with housing flexibility. Essentially the worst of all worlds.

Then I think we can agree that not building enough higher density low/mid rise in good neighbourhoods is not just a Vancouver problem - it's a market failure that has been noticed by many in different Canadian cities. The solution to that? Beats me.

Personally I like the newer block sized townhome/condo developments in Bridgeland and Marda Loop (though the maintenance fees usually fully counter any savings from buying an attached townhome), but there are far too few of these being built.

[geotag277]

Originally Posted by dleung

I don't know why you keep harping on how expensive towers are. Developers love building towers because they can pile on more density, and divide the land cost over more owners, and incidentally sell each unit at a more affordable price. The days of <5 FSR tower developments (against which mid-rises are competitive density-wise) are over.

Part of the problem with towers is that they are an unmitigated profit grab by developers, who without proper municipal guidance (read: bylaws) will simply maximise their profit. That typically means a litany of tiny 1 bedroom 400 sqft affairs with a subset of 600-1000 2 bedrooms. If there is a three bedroom, it is typically worked into a penthouse unit which is 2000+ sqft and multi-million dollars.

This is the typical model for towers, and it ends up being a bit of an urban planning failure, as options for families are extremely limited. Towers also tend to be built on the most desirable highest cost land, which further negates potential affordability.

This is one area Vancouver does pretty well, as places like Burnaby actually mandate family friendly 3 bedroom units as part of developments. There needs to be more push like that to balance affordability and availability of types of units constantly. If a family can make it work in 10% of new units coming on the market in tower-style developments, that would put downward pressure on prices of townhomes where the typical family would feel is their only option.

[ssiguy]

I don't have any stats and I am not going to bother getting any either but I think it's fair to say that Vancouver has built many more high-rise condos than Calgary over the last 15 years.

That said looks can be very deceiving. CMHC recently stated that 20% of all new condo sales in Vancouver were to foreigners but that number is very low because it doesn't account for kids who buy homes for their parents and doesn't include numbered companies which is money laundering 101. That means the a huge amount of new condos in Vancouver are not being occupied but simply bought to launder money and later flip to the next Chinese money launderer.

I agree that Vancouver's once laudable urban planning has gone the other direction with our planning dept being run by realtors and developers and City Hall rubber stamping everything as they only look at the tax revenue. How can such a small, relatively unimportant place with low wages be proclaimed an urban planning success when people can't afford to live there and the ones already there are being thrown out of their accomodation? That's the problem with Vancouver's density style model...........it's premised on simply building highrises but forgetting the idea that unless people live in these new towers it doesn't increase density one bit.

[ssiguy]

On another note, Andrew Weaver the leader of the Green party of BC and the guy holding the balance of power in the BC government was interviewed today and you can read it at theprovince.com and he supports a New Zealand type complete ban on all foreign buyers in BC. He can't do that "technically" as it is a federal matter but can get around that by increasing the foreign buyers tax from 15% to 1015% effectively resulting in the exact same thing. He called a spade and spade and stated it was foreigners parking their money that has caused BC's dire current situation.

The problem? Carole James the Minister of Finance has stated that a total ban is not being considered. I am concerned that the NDP has fallen in love with the tax revenue of money launderering in the real estate market the same way the Liberals did. My concern was already there when David Ebby who has been a strong and very vocal advocate of affordable housing and getting rid of the foreign money was given a post not in housing or finance but rather Solicitor General.

[geotag277]

It is frustrating how Eby seemingly has been maneuvered into complete silence on the issue. If the Greens/NDP are at an impasse on housing that is very bad. Vancouver can't wait until the next election to sort this out, and a sudden failure of confidence triggering another election might just end up with another liberal do-nothing situation.

[Pinion]

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[geotag277]

Vancouver has actually done traditionally (historically) very well in mid rise, but I think they've fallen off the wagon a bit with a tower dependency. Existing old stock density pads Vancouver's numbers a bit - old stock density doesn't help a rapidly growing city like Vancouver. It needs to keep improving.

[geotag277]

You can see Vancouver somewhat falling off the wagon on mid-rise between the two census reports:

2016:

http://www12.statcan.gc.ca/census-recensement/2016/as-sa/98-200-x/2016005/98-200-x2016005-eng.cfm

2011:

http://www12.statcan.gc.ca/nhs-enm/2011/as-sa/99-014-x/2011003/tbl/tbl1-eng.cfm

In 2016, apartments under 5 stories accounted for about 36% of individuals living in multi-family residences. In 2011, it was 41.3%.

Interesting numbers, I will try to build a spreadsheet to compare metro areas to growth components (babies, immigrants, intra-provincial, etc.), we might get some good insights.