Nelson Rockefeller’s grandchildren probably don’t live in single-family detached homes in Manhattan. Neither will your kids live in such housing in Vancouver.
That message was delivered recently by condo king Bob Rennie, of Rennie Marketing Systems. He conveyed the notion that the world has moved on, that cities change, and that younger generations are adjusting their expectations, in a speech to the Urban Development Institute,
The fact is that Vancouver has been outed as a great hedge city, according to a recent article in the Harvard International Review. It argued that rich people, particularly from China and Russia, countries pairing capitalist economies with unpredictable authoritarian political systems, regard Vancouver as one of just a handful of cities that are safe, secure places to invest.
The article, written by Jessica Dorfmann, reports that “whole neighbourhoods are under construction” in Vancouver, and asks: “How long can Vancouver sustain these levels of growth and investment?
“And what will a sudden crisis in Beijing mean for Vancouver?”
The article observes that all the new investment has caused “an affordability crisis for what should be the next generation of local property owners.”
And there is no relief in sight because, while “hedge cities can hope for the best, in a truly globalized real estate market, their fates are out of their hands.”
That brings us back to Rennie, who is advocating a tax to curb real estate speculation, which would do nothing to address Vancouver’s problems as a hedge city. Foreigners invest their money here, in housing, for the longer term.
It also would not address property demand expected to continue from the thousands who move here annually.
Rennie acknowledges there is only one effective way to address lack of affordability: more density, much more. Not just on arterial streets but on quiet avenues.
Rennie is preparing us for the inevitable decline and fall of the single-family home in Vancouver. Think woolly mammoth.
Detached homes, he says, are “on the verge of extinction.” It is already happening. Between 2006 and 2011, the city lost 900 single-family homes.
Just look at Cambie Street, or the legion of homeowners newly afflicted by the land assembly bug, banding together to sell whole blocks to developers who will seek rezoning to build townhouses and condos.
Rennie says Vancouver has about 47,000 single-family homes and a limited land base. New, detached properties are not being created.
On my Kitsilano street, over the past year, two single-family houses were bulldozed, replaced by large duplex developments accommodating four families where formerly there were two.
There are more cars on the street, more dogs and kids and backyard barbecues but not more affordability: the half duplexes sold for nearly $2 million each. One sold three hours after a for-sale sign was posted.
Perhaps if enough multi-family developments proliferate, affordability will ease. Certainly no one has found a better idea to facilitate it.
High density throughout Vancouver would make this city look more like Manhattan or Paris, where apartments are the norm, including for families, and detached homes are nowhere to be found.
It is worth noting that in those cities, affordability is also elusive. Try buying a 600-square-foot apartment in central Paris; see how far your money goes.
To achieve affordability, Parisian home buyers move to the suburbs. This is happening, too, in Vancouver. As Rennie told his audience, “Main is the new Granville St., Fraser is the new Oak.”
The good news: millennials in Vancouver, aged 19-35, do not have the same expectations as baby boomers. They don’t necessarily see themselves joining the white-picket fence crowd.
A poll cited by Rennie reveals 81 per cent of millennials in Surrey, Richmond, Vancouver and Burnaby believe Greater Vancouver is headed in the right direction. “They’re happy, and they’re a force, and we’d better start understanding them.”