Streamlining rental (Public Hearing 2/4/9 Nov 2021): Staff claims that rental rezonings will result in ‘no increase in land value or speculation’ deserve greater scrutiny and review

(Update: The speakers list and correspondence closed for the Public Hearing on ‘Streamlining Rental’ on November 9, 2021, and the final vote by Council will be done during a Regular Council meeting on Tuesday, November 16,2021.)

A CityHallWatch reader has suggested that we mention another serious issue with the “Streamlining Rental” topic at the November 2 evening Public Hearing. We’ve done many posts on this topic. Try “streamlining rental” in the search field on our top page for more.

Buried within the 348-page staff report (Streamlining Rental Around Local Shopping Areas – Amendments to the C-2, C 2B, C-2C and C-2C1 Zones and Creation of New Rental Zones for Use in Future Rezoning Applications in Surrounding Low Density Areas Under the Secured Rental Policy), the focus of this Public Hearing, is this statement of staff findings (Table 4, page 16, excerpt below):

Staff are saying that …

• At the proposed heights and densities, no increase in land value or speculation is anticipated due to the restriction on rental tenure, and requirement for enhanced affordability for six-storey buildings

• Incentives are necessary to make new secured rental development viable given high value of land under current C-2 and RS/RT zoning

Based on information available to the public, it would appear that this statement is far from the truth, for residential areas in the proposal at least. As stated by Scot Hein, the “City’s approach does not secure true affordability, while giving away land value to market speculation after you have approved.”

The Georgia Straight has recently provided a number of examples of sites in Vancouver that have been rezoning for “affordable” rental housing, with the result so far being that the land remains vacant and/or nothing new is built yet. But the owners and/or speculators enjoy windfall profits with the new status with higher density. The result is devastating for affordability

See for example, “Vacant lot rezoned by Vancouver city council for rental project flipped for $5 million” (Carlito Pablo, Georgia Straight, 29-Oct-2021). The property sold recently for $5 million, more than double the lot’s 2021 assessed value of $2,117,000. The listing for 2109 West 35th Avenue (and Arbutus) highlighted the “development potential” of the property. See other articles below on cases of speculation and windfall profits but no production of affordable rental housing.

The nature of land assembly is that there will always be hold outs and the land prices get pushed up. There is plenty of evidence across the city of what homes trade at in land assemblies versus individual house sales, on both rental and strata projects.

The claims being made by staff that “no increase in land value or speculation is anticipated” deserve careful scrutiny and independent review. It’s the job of our elected officials to ensure that this scrutiny and review is done properly BEFORE they make decisions.

Besides the failure to produce affordable rentals, could unsubstantiated statements by staff leading to Council decisions like this open the City up to future lawsuits and challenges?

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OTHER COVERAGE

Vancouver’s Upzoning Push Lacks One Guarantee. Affordability: The bylaw is sold as a way to create new rentals. Council should insist what’s built reflects real incomes.” (Patrick Condon, TheTyee.ca, 2-Nov-2021). Prof Condon gives two examples.

In one, the City Council upzoned a collection of lots at Dunbar Street and King Edward Avenue with the hope of sparking affordable rentals. Result? The land price skyrocketed after it was marketed as an opportunity for land assembly, doubling over assessed value from around $2.5 million per plot to about $5 million per plot. In the second case, he mentioned the lot at 2109 West 35th Avenue (and Arbutus) rezoned for purpose-built rentals (see also the article mentioned above – “Vacant lot rezoned by Vancouver city council…”). Vancouver staff supported the application, stating, “If approved, this application would contribute to city-wide goals for the achievement of key affordable housing goals of the city.” Council passed the zone change in July 2018, but to date no building has been built, and instead the empty parcel has been flipped for $5 million, well over double its assessed 2021 value of $2,117,000. Prof Condon then does the math on the perverse results of the City’s approach to rezoning for rentals and what it does to housing costs.

East Vancouver home on block designated for six-storeys sold at double assessed value for $2.8 million” (Carlito Pablo, Georgia Straight, 1-Nov-2021). https://www.straight.com/news/east-vancouver-home-on-block-designated-for-six-storeys-sold-at-double-assessed-value-for-28 (Note that this is not rental, but does provide yet another case of the simple act of rezoning for increased height and density resulting in profits, speculation, and higher land costs)

Prezoned by City of Vancouver for higher density, lots near Joyce Station selling four times assessed values
(Carlito Pablo, Georgia Straight, 10-Jan-2021). Note – The Joyce-Collingwood Station Precinct Plan identifies Payne and Ann streets as a sub-area where mid-rise buildings will be allowed. These buildings are four- to six-storey apartments, and townhouses.

Vancouver home in Cambie Corridor high-density plan sells for almost $1 million more than assessed value
(Carlito Pablo, Georgia Straight, 5-April-2021). Note – The realty agency included in its pitch an “investment” opportunity available for a successful buyer. The property is designated for either a four-storey condo development or a six-storey rental building under the Cambie Corridor Plan.

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