Vancouver Rental Market Discussion

[FarmerHaight]

Yeah, there are plenty of one bedroom and studio apartments in the Metro Van area that can be got for less than $1,700.

[whatnext]

I'm a little curious how Horgan and the NDP expect landlords to keep their expenses below 2% to match this.

B.C. government announces 2 tax credit boosts, rent increase cap for 2023
By Richard Zussman Global News
Posted September 7, 2022

...Instead of allowing rent increases equivalent to inflation, B.C. is also placing a cap of two per cent on increases for 2023. For a renter paying $2,000 in rent, that could mean savings of up to $816 next year.

Horgan said he will work with B.C. landlords to come up with solutions that meet their needs, but the “crisis” experienced by renters now must be addressed...

https://globalnews.ca/news/9111675/bc-cost-of-living-supports-horgan/

[GenWhy?]

Originally Posted by whatnext

I'm a little curious how Horgan and the NDP expect landlords to keep their expenses below 2% to match this.

B.C. government announces 2 tax credit boosts, rent increase cap for 2023
By Richard Zussman Global News
Posted September 7, 2022

...Instead of allowing rent increases equivalent to inflation, B.C. is also placing a cap of two per cent on increases for 2023. For a renter paying $2,000 in rent, that could mean savings of up to $816 next year.

Horgan said he will work with B.C. landlords to come up with solutions that meet their needs, but the “crisis” experienced by renters now must be addressed...

https://globalnews.ca/news/9111675/bc-cost-of-living-supports-horgan/

Depends on the type of landlord you're referring to. I'm pretty sure they can still file requests to increase it for maintenance and renovations like in the past.

If it's John Smith who owns a condo... maybe they should live in it instead.

[GenWhy?]

The building I'm in will make an additional, somewhere between, $60k-$80k, I assume

[whatnext]

Originally Posted by GenWhy?

Depends on the type of landlord you're referring to. I'm pretty sure they can still file requests to increase it for maintenance and renovations like in the past.

If it's John Smith who owns a condo... maybe they should live in it instead.

Does the average John Smith even play by those rules?

[WarrenC12]

Originally Posted by GenWhy?

Depends on the type of landlord you're referring to. I'm pretty sure they can still file requests to increase it for maintenance and renovations like in the past.

That has never been a thing. Only for trailer parks perhaps.

[chowhou]

Price controls on a market are always gross populist policy. Supporting rent control is just as evil as supporting NIMBYism and housing crisis denial. It's the exact same "Fuck you, I got mine" mentality. People who are already renting are the current voters, so absent of morals and rationality they pursue rent seeking political policy surrounding leases at the expense of future renters. "I don't care if all future renters are forced to pay more to subsidize me, don't let my rent go up!". In the exact same way people who already own property are current voters, so absent of morals and rationality they pursue rent seeking political policy surrounding home ownership at the expense of future home owners. "I don't care if all future home buyers are forced to pay more to subsidize me, don't let my home value go down!"

By their powers combined, we get no new units built and housing prices skyrocket making homeowners rich, while at the same time our sweet precious existing renters and their votes are protected for the rest of their life. Everyone established (voters) is happy and healthy. Fuck you to the youth coming of age and wanting to live in the city, fuck you to immigrants/refugees trying to make Vancouver home, fuck you to people who would need to upsize to start/grow a family, fuck you to people in the interior/rest of Canada who could move to Vancouver for economic opportunities.



I support so much NDP policy and in general I believe it comes from a more rational, long term focus than BCLIB policy, but rent control is so horrible and indefensible on its own I don't know who to support anymore.

[GenWhy?]

Originally Posted by WarrenC12

That has never been a thing. Only for trailer parks perhaps.

Was thinking of this:

https://www2.gov.bc.ca/gov/content/housi...will,the%20rental%20unit%20or%20building.

[GenWhy?]

How does rent control hurt future renters?

[chowhou]

Originally Posted by GenWhy?

How does rent control hurt future renters?

Rent control has historically been show to do several things impacting future renters.

1. Incentivize landlords to sell existing rental properties for conversion to privately owned properties
2. Discourage investment in construction of new rental stock
3. Encourage people to overconsume housing, consuming space they may not need or even want. For instance, empty nesters renting a 3br apartment will be discouraged from downsizing to a 1 or 2br since market rates for smaller units may be higher than their rent controlled unit.

All of these factors increase the overall market rate due to the corresponding decrease in supply without reducing demand, thus impacting future renters.

This is only impacts to future renters, other issues with rent control include discouragement of reinvestment in existing properties and incentive to evict in order to seek higher rental rates. Remember how BC has the highest eviction rate in Canada?

Everyone has always known that setting price controls on bread is economically disasterous, why would we ever expect another commodity (housing is still a commodity, love it or hate it) to behave differently?

EDIT:
I'd like to point out I'm not necessarily against some level of rent stabilization, price smoothing might not be the worst thing in the world in order to prevent mass disruptions of people given price shocks (see price gouging laws, and the previous rent increase equation CPI + 2% under the BCLIBs). Price controls are bad populist policy though. 2% allowed in 8% inflation years is gross. Neither I nor anyone related to me is a landlord, FYI. Shouldn't have to say it but I expect to be called out for that.

EDIT2:
I've also seen arguments that implementing rent control as a temporary band aid while implementing other solutions which take time to come into effect (legalize building goddamn housing!) can possibly be a positive, but this is with the expectation that rent control is a short term policy. It's hard to take away the candy once it's been given.

[GenWhy?]

Originally Posted by chowhou

Rent control has historically been show to do several things impacting future renters.

1. Incentivize landlords to sell existing rental properties for conversion to privately owned properties
2. Discourage investment in construction of new rental stock
3. Encourage people to overconsume housing, consuming space they may not need or even want. For instance, empty nesters renting a 3br apartment will be discouraged from downsizing to a 1 or 2br since market rates for smaller units may be higher than their rent controlled unit.

All of these factors increase the overall market rate due to the corresponding decrease in supply without reducing demand, thus impacting future renters.

Appreciate the thorough response. From my perspective I honestly think #1 is a good thing and a move in the right-ing the ship's course.
#2 has shown to not be true over the last decade.
#3 I feel this is a minor problem with rental (very complex that extends into zoning itself), but I see this more of an issue with SF homes and I'd rather the collective tackle that first than be distracted by loosening rent increases.

[chowhou]

Originally Posted by GenWhy?

Appreciate the thorough response. From my perspective I honestly think #1 is a good thing and a move in the right-ing the ship's course.
#2 has shown to not be true over the last decade.
#3 I feel this is a minor problem with rental (very complex that extends into zoning itself), but I see this more of an issue with SF homes and I'd rather the collective tackle that first than be distracted by loosening rent increases.

#1 is not a good thing. There will always be people who want/need rentals. Not everyone wants to settle down locked into a $1m mortgage on a 2br apartment for the next 30 years. Some people prefer to have liquid investments so they can easily uproot and move elsewhere. Bear in mind not everyone is already living in Vancouver, there are plenty of people who grew up in the interior and don't want to settle down there. They should have rental stock in their community, and places to land in the Lower Mainland if they so choose.

#2 is hard to prove, given how restrictive housing policy is in the first place. I think it's fair to say that we all know there would be way more housing starts if municipal governments simply allowed it. Either way, it has absolutely not been shown to be false. Here's at least one analysis of housing starts in California after the lifting of their rent control laws.

#3 is a known factor. I don't disagree that it's the case for SFH, I think it's pretty rare for someone to get into that state in Vancouver without the landlord selling to a willing buyer, but grandma shouldn't be renting a Vancouver Special that a family could live in, sorry. It hurts our workforce too, someone living and working in Victoria who might be able to get a great job with a +20% pay bump will be disincentivized to move to the Lower Mainland if their rent is artificially subsidized but only if they stay put.

You know what solves all of these issues without the negative externalities? Building more housing. Band aid solutions are not real solutions. Bring on the real solutions. Legalize housing.

[logan5]

Originally Posted by chowhou

Price controls on a market are always gross populist policy. Supporting rent control is just as evil as supporting NIMBYism and housing crisis denial. It's the exact same "Fuck you, I got mine" mentality. People who are already renting are the current voters, so absent of morals and rationality they pursue rent seeking political policy surrounding leases at the expense of future renters. "I don't care if all future renters are forced to pay more to subsidize me, don't let my rent go up!". In the exact same way people who already own property are current voters, so absent of morals and rationality they pursue rent seeking political policy surrounding home ownership at the expense of future home owners. "I don't care if all future home buyers are forced to pay more to subsidize me, don't let my home value go down!"

By their powers combined, we get no new units built and housing prices skyrocket making homeowners rich, while at the same time our sweet precious existing renters and their votes are protected for the rest of their life. Everyone established (voters) is happy and healthy. Fuck you to the youth coming of age and wanting to live in the city, fuck you to immigrants/refugees trying to make Vancouver home, fuck you to people who would need to upsize to start/grow a family, fuck you to people in the interior/rest of Canada who could move to Vancouver for economic opportunities.



I support so much NDP policy and in general I believe it comes from a more rational, long term focus than BCLIB policy, but rent control is so horrible and indefensible on its own I don't know who to support anymore.

Move to Australia. Things are surely better there.

[chowhou]

Originally Posted by logan5

Move to Australia. Things are surely better there.

Melbourne property values and rents are much lower and Sydney property values and rents are about the same, I'm not sure what your argument is. I really enjoyed my time there when I visited a couple of years ago and it would be on my radar if I didn't highly value my friends and family in the Lower Mainland. If push came to shove I wouldn't feel bad about it.

Compare average rent by city in Australia vs Canada.

I would never say to people wanting transit improvements, "Just move to Tokyo" or to people wanting healthcare improvements, "Just move to Scandinavia". We should be able to improve what we have here.

[Migrant_Coconut]

There's a 50% chance that it's a Judith Viorst reference.

“Some days are like that, even in Australia.”

[chowhou]

Originally Posted by Migrant_Coconut

There's a 50% chance that it's a Judith Viorst reference.

Maybe, but Australia is a very similar country to ours, and Melbourne is a very similar city to ours, with no rent control. They don't worry as much about building things there, though.

[Changing City]

Originally Posted by chowhou

Maybe, but Australia is very similar country to ours, and Melbourne is a very similar city to ours, with no rent control. They don't worry as much about building things there, though.

It's never straightforward to compare one city with another when they're in different countries. While there are obvious similarities between Melbourne and Vancouver, it has double the population in an area almost four times larger, so has half the population density. That has a significant impact on how easy it is to build more housing. Many of the renters wish there were rent controls, as affordability has apparently become a significant problem in the recent past.

[chowhou]

Originally Posted by Changing City

It's never straightforward to compare one city with another when they're in different countries. While there are obvious similarities between Melbourne and Vancouver, it has double the population in an area almost four times larger, so has half the population density. That has a significant impact on how easy it is to build more housing. Many of the renters wish there were rent controls, as affordability has apparently become a significant problem in the recent past.

In my defense, I didn't ask for the comparison. All I have to say is there's really nothing making it hard to build housing in Metro Vancouver other than government intervention. There's alway going to be rent-seekers who want price controls to make their lives easier at the expense of others, but that doesn't change the fact it's bad policy.

As an aside, it's funny how in the article one of the stats given is how the median house rent has gone as high as $430 per week.

So, if we do the math, average of 52 / 12 = 4.33 weeks per month, $430 * 4.33 = $1862 a month.

Hm, seems similar to Vancouver, right? Wrong. That's house rent. For an entire house in Melbourne. But wait, that's in AUD!

Current exchange rate is 0.88 CAD/AUD -> 1862 * 0.88 = $1638 per month for a house in Melbourne. We could only dream of such prices.

[Changing City]

Originally Posted by chowhou

In my defense, I didn't ask for the comparison. All I have to say is there's really nothing making it hard to build housing in Metro Vancouver other than government intervention. There's alway going to be rent-seekers who want price controls to make their lives easier at the expense of others, but that doesn't change the fact it's bad policy.

As an aside, it's funny how in the article one of the stats given is how the median house rent has gone as high as $430 per week.

So, if we do the math, average of 52 / 12 = 4.33 weeks per month, $430 * 4.33 = $1862 a month.

Hm, seems similar to Vancouver, right? Wrong. That's house rent. For an entire house in Melbourne. But wait, that's in AUD!

Current exchange rate is 0.88 CAD/AUD -> 1862 * 0.88 = $1638 per month for a house in Melbourne. We could only dream of such prices.

You're continuing to 'compare' data that have very different contexts. The median rent in Melbourne for a house is lower than it would be here, but you're comparing the median across an area that's nearly 4 times that of Metro Vancouver. What is the median rent for a house in Metro Vancouver anyway? Until the 2021 census data comes out, there's no reliable data. CMHC only survey apartment data because rental properties in Canada are almost always apartments, but in Australia it's more common to live in a house, but they're not necessarily much bigger than an apartment, so data on the rent for a house there, and here, wouldn't be comparing similar accomodation.

But your belief that somehow the lack of rent control makes things easier there isn't supported by their current affordability crisis there. 'Australia's Rental Market Hurtles Toward Disaster',
suggests a problem. 10% rent increases, and yet 40% fewer rental listings suggests things are far from ideal, and for renters are very difficult. And getting much worse. "Melbourne city and suburban renters are now being forced by their landlords to pay more or find a new place to live, with some reporting rental increases of more than 30 per cent."

[GenWhy?]

Originally Posted by chowhou

You know what solves all of these issues without the negative externalities? Building more housing. Band aid solutions are not real solutions. Bring on the real solutions. Legalize housing.

Agreed. Once this is tackled and vacancy rates rise, rental competition increases and potential homeowners are no longer "forced" into the rental market, putting downward pressure on folks who (in the near or long term) cannot own, then we (the Province) can likely loosen rent control laws. Once there is a competitive market, rental turnover increases which allows landlords to reset rents back to market rate when their tenants move out.