The BC Real Estate Discussion Thread

[Russ]

9 hours ago, Junkyard Dog said:

I live at home still at 27 and pretty much am able to for the next while or so as I finish school. Even after 1st year of school is done I’ll probably be making 5-6k(working OT) a cheque with little commitments and lowish rent. Good time to start saving for a place. 
 

Hopefully in 5ish years the housing market can begin to settle down a bit. 
 

I work in a camp setting too so 2/3rds of the time I have everything paid for. 
 

What’s in extremely high demand atm are Ironworkers in BC. Local 97 screaming for guys and you’re never out of work. They bring guys from the east coast to work here. The projects coming up soon will create even more. Gonna be a good next 10-15 years. I recommend if anyone knows anybody who wants a career path or something for themselves.

Lots of jobs in trades. I knew some ironworkers in the past and they were great guys.

[taxi]

13 hours ago, Elias Pettersson said:

What is the reason for the lack of inventory in the market and the consequential price increases that are making this city even more unaffordable?

 

It's actually quite simple to figure out.  It all has to do with interest rates.  Currently, around 56% of all homeowners have a mortgage on their principal residence.  Out of that 56%, approximately 71% of those people have a fixed rate mortgage.  Which was obtained well before the rate increases of the last 18 months.  These people are locked into rates that are well under 3%.  2% or lower for some.  So, they are locked in at low rates and are not affected by this current rate environment.  So, what does this have to do with low inventory?

 

Well, if you want to move you would need to sell your place, which means you would need to break that mortgage and get an even bigger mortgage at a much higher rate.  And the people who tend to move the most, the younger people, are the ones who are affected the most as they can't really afford to move and lose that interest rate.  So, people are holding tight for now and not selling at this time.  Which is one of the major causes for the 20+ year low in real estate inventory.

 

My buddy told me this theory and it seems to make alot of sense.  It's not the only reason for the lack of inventory, but it is one of the bigger ones.  This should continue for awhile until these mortgages come due for renewal, which should be in the next couple of years.  In the meantime, expect prices to keep going up this year.  Next year might be even worse.  

 

The problem with that theory, is that young people tend to move from smaller to larger places, which actually decreases inventory. You only get a net increase in inventory when people downsize, move to a rental, or leave the housing market.

 

There's so little inventory, because we simply don't have enough housing. A million be Canadians this year, and nowhere near enough new housing units.

[Elias Pettersson]

1 hour ago, taxi said:

The problem with that theory, is that young people tend to move from smaller to larger places, which actually decreases inventory. You only get a net increase in inventory when people downsize, move to a rental, or leave the housing market.

 

There's so little inventory, because we simply don't have enough housing. A million be Canadians this year, and nowhere near enough new housing units.

That’s not true. If someone  is moving from a one bedroom home to a townhouse, then that one bedroom home would be put on the market, which increases the inventory in that price range. 
 

The biggest issue with inventory right now is finding homes for first time home buyers. Having a bunch of one bedroom and two bedroom condos come onto the market would definitely help the inventory issue. As well, these would be ready to move in condos, versus a developer putting a high rise up for presale and having to wait 4 years to move in. 
 

Inventory levels are down all across North America, it’s not just a Vancouver thing, so there is legitimacy to this theory as interest rates have risen dramatically all across North America over the last 2 years. 
 

The quickest way to increase inventory levels is for people to put their places up for sale. Waiting for developers to construct a high rise or waiting for the government to rezone some land takes years to accomplish the same objective. 

[taxi]

54 minutes ago, Elias Pettersson said:

That’s not true. If someone  is moving from a one bedroom home to a townhouse, then that one bedroom home would be put on the market, which increases the inventory in that price range. 
 

The biggest issue with inventory right now is finding homes for first time home buyers. Having a bunch of one bedroom and two bedroom condos come onto the market would definitely help the inventory issue. As well, these would be ready to move in condos, versus a developer putting a high rise up for presale and having to wait 4 years to move in. 
 

Inventory levels are down all across North America, it’s not just a Vancouver thing, so there is legitimacy to this theory as interest rates have risen dramatically all across North America over the last 2 years. 
 

The quickest way to increase inventory levels is for people to put their places up for sale. Waiting for developers to construct a high rise or waiting for the government to rezone some land takes years to accomplish the same objective. 

Except they are also buying a place...which means a net increase of zero. Also, they may be buying a place with multiple units, which means a net decrease of housing stock.

[Elias Pettersson]

6 minutes ago, taxi said:

Except they are also buying a place...which means a net increase of zero. Also, they may be buying a place with multiple units, which means a net decrease of housing stock.

Yes, it's a net increase of zero, however it adds inventory to a price range that is more in demand in the market.  Adding inventory isn't just about increasing supply, it's more about increasing affordable supply.  If you add 2,000 new homes onto the market for example in the $3 million price range, that will show as increased overall inventory, but isn't going to help most people to be able to buy a home...

[taxi]

1 hour ago, Elias Pettersson said:

Yes, it's a net increase of zero, however it adds inventory to a price range that is more in demand in the market.  Adding inventory isn't just about increasing supply, it's more about increasing affordable supply.  If you add 2,000 new homes onto the market for example in the $3 million price range, that will show as increased overall inventory, but isn't going to help most people to be able to buy a home...

I'd argue that there is a bigger shortage of options as you move to 2 and 3 bedroom places. There are plenty of studio and one bedroom places, and we don't really need more of those. We need more townhouses and units appropriate for small families. 

Edited May 16, 2023 by taxi

[Elias Pettersson]

3 minutes ago, taxi said:

I'd argue that there is a bigger shortage of options as you move to 2 and 3 bedroom places. There are plenty of studio and one bedroom places, and we don't really need more of those. We need more townhouses and units appropriate for small families. 

Small families are living in one- and two-bedroom condos.  That is all they can afford.  They aren't living in townhouses.  Townhouse inventory only accounts for around 10% of all inventory on the market today.  Developers don't build alot of townhouses, especially in the city.  There is no money to be made to build row townhomes on expensive land in the city.  If you want a row townhouse for a small family you need to go out to the suburbs.  Even then they are a million+ to start.

 

Developers don't build 3-bedroom condos for the most part.  They are too expensive as a price point and it's alot more profitable to build one and two bedrooms.  3-bedroom condos only account for around 13% of all condo inventory.

 

At the end of the day, people need a place to live.  And they need to be able to afford it.  The dream is to have thousands of townhouses and detached homes on the market at affordable prices for families to purchase.  The reality is these families can only afford a one- or two-bedroom condo.  So, if you increase that portion of the inventory then at least you are allowing people the chance to actually buy a home they can afford.  It's not ideal for alot of people, but it is better than renting and allows people to build equity for the next purchase...

[TheOgRook]

18 hours ago, Junkyard Dog said:

I live at home still at 27 and pretty much am able to for the next while or so as I finish school. Even after 1st year of school is done I’ll probably be making 5-6k(working OT) a cheque with little commitments and lowish rent. Good time to start saving for a place. 
 

Hopefully in 5ish years the housing market can begin to settle down a bit. 
 

I work in a camp setting too so 2/3rds of the time I have everything paid for. 
 

What’s in extremely high demand atm are Ironworkers in BC. Local 97 screaming for guys and you’re never out of work. They bring guys from the east coast to work here. The projects coming up soon will create even more. Gonna be a good next 10-15 years. I recommend if anyone knows anybody who wants a career path or something for themselves.

Congrats on school and getting close to the finish. We need more of you too!! Such a shortage of Ots at the moment!  The problem being is it’s not a quick fix.. you can have all tradespeople working in the field after a year of school.. you folks spend the better part of a decade so it’s not a quick fix. Good luck in the industry

[taxi]

4 hours ago, Elias Pettersson said:

Small families are living in one- and two-bedroom condos.  That is all they can afford.  They aren't living in townhouses.  Townhouse inventory only accounts for around 10% of all inventory on the market today.  Developers don't build alot of townhouses, especially in the city.  There is no money to be made to build row townhomes on expensive land in the city.  If you want a row townhouse for a small family you need to go out to the suburbs.  Even then they are a million+ to start.

 

Developers don't build 3-bedroom condos for the most part.  They are too expensive as a price point and it's alot more profitable to build one and two bedrooms.  3-bedroom condos only account for around 13% of all condo inventory.

 

At the end of the day, people need a place to live.  And they need to be able to afford it.  The dream is to have thousands of townhouses and detached homes on the market at affordable prices for families to purchase.  The reality is these families can only afford a one- or two-bedroom condo.  So, if you increase that portion of the inventory then at least you are allowing people the chance to actually buy a home they can afford.  It's not ideal for alot of people, but it is better than renting and allows people to build equity for the next purchase...

The whole point is that there aren't nearly enough townhouses. Unless Vancouver totally rezones large areas of the city, which they are actually in the process of doing, we won't see any either. 

 

Townhouses can definitely be profitable. If, for example, you rezone all of Nanaimo Street to allow for townhouses, where there are single family homes, you could make a large profit. You can have 3 townhouses plus a coach house on a single lot. You buy a teardown for $1.5-2.2 million and replace it with four 3 bedroom townhouses that you can sell for $1.5 million each.

[Warhippy]

14 minutes ago, taxi said:

You buy a teardown for $1.5-2.2 million and replace it with four 3 bedroom townhouses that you can sell for $1.5 million each.

looool

 

Ya, that's gonna solve the housing crisis.

 

3 bedroom townhome, $1.5 million.

 

For a city where people cannot afford $650,000 on average.

 

This is how out of place and out of touch we are right now with housing.  What kind of life will people have if they have to find the income for that housing cost?  What kind of rent would someone need to charge to afford that as an income property?

 

Not just kicking the can down the road, exacerbating it even more.

[Gurn]

9 minutes ago, Warhippy said:

looool

 

Ya, that's gonna solve the housing crisis.

 

3 bedroom townhome, $1.5 million.

 

For a city where people cannot afford $650,000 on average.

 

This is how out of place and out of touch we are right now with housing.  What kind of life will people have if they have to find the income for that housing cost?  What kind of rent would someone need to charge to afford that as an income property?

 

Not just kicking the can down the road, exacerbating it even more.

perhaps selling drugs or operating one of those 'birth tourism' lodges will allow folks to get the money needed?

 

I'm not big on finding excuses for criminals, yet there are times I wonder if we are pushing ourselves into it?

 

Stuff gets way too expensive, some people will take drastic measures.

[Elias Pettersson]

1 hour ago, taxi said:

The whole point is that there aren't nearly enough townhouses. Unless Vancouver totally rezones large areas of the city, which they are actually in the process of doing, we won't see any either. 

 

Townhouses can definitely be profitable. If, for example, you rezone all of Nanaimo Street to allow for townhouses, where there are single family homes, you could make a large profit. You can have 3 townhouses plus a coach house on a single lot. You buy a teardown for $1.5-2.2 million and replace it with four 3 bedroom townhouses that you can sell for $1.5 million each.

Building row townhouses right in the city isn't affordable for the average person.  Also, they're not as profitable for the builder.  Those lots on Nanaimo street are actually already zoned for multi-family.  Every lot in Vancouver is now a multi-family lot.  Problem is you are not getting 3 row townhouses plus a coach house on a standard lot.  A developer would end up building a front and back duplex with a suite.  Then sell off each side of the duplex, so 1/2 duplex for around $1.5 million.

 

Like @Warhippy said, that's not really going to help the housing crisis as the average buyer can only afford $700-800k.  To afford a $1.5 million 1/2 duplex or townhouse your combined income needs to be like $300k.  And that is if you have a 20% downpayment.

 

At the end of the day, the larger townhomes need to be built outside the city to get the price down to around $1 million max.  There is lots of empty land available outside the city that can be rezoned for this purpose.  Problem is the municipal governments are dragging their feet with all of the red tape...

[Guest]

On 5/15/2023 at 6:20 PM, Junkyard Dog said:

I live at home still at 27 and pretty much am able to for the next while or so as I finish school. Even after 1st year of school is done I’ll probably be making 5-6k(working OT) a cheque with little commitments and lowish rent. Good time to start saving for a place. 
 

Hopefully in 5ish years the housing market can begin to settle down a bit. 
 

I work in a camp setting too so 2/3rds of the time I have everything paid for. 
 

What’s in extremely high demand atm are Ironworkers in BC. Local 97 screaming for guys and you’re never out of work. They bring guys from the east coast to work here. The projects coming up soon will create even more. Gonna be a good next 10-15 years. I recommend if anyone knows anybody who wants a career path or something for themselves.

Iron Workers 

Millwrights 

Heavy Duty Mechanics 

 

They're all in very high demand, you're right.  I'm an electrician and it's not too bad for us either. 

[Junkyard Dog]

On 5/15/2023 at 11:49 PM, Warhippy said:

When you say ironworker.

 

You mean rodbusting or structural and flange?

Rodbusting/Post-Tensioning/Welding/Structural/ETC

 

Pretty much the general jist of it with Local 97. They screaming for guys and even trying to get youth programs started like Rebar Bootcamp and what not. 

 

Probably be another job like LNG in Kitimat in Squamish within the next few years. There will be a lot of work for the next 10-15 years.

[Warhippy]

3 minutes ago, Junkyard Dog said:

Rodbusting/Post-Tensioning/Welding/Structural/ETC

 

Pretty much the general jist of it with Local 97. They screaming for guys and even trying to get youth programs started like Rebar Bootcamp and what not. 

 

Probably be another job like LNG in Kitimat in Squamish within the next few years. There will be a lot of work for the next 10-15 years.

My previous life I started.   my trades as a rodbuster posting hanging slabs and elevator columns on the lower mainland before moving in to post tensioning and then finally structural and flange/i-beam on larger projects and bridge repair, abutment and replacement.  

 

Nothing but respect for anyone who cut their teeth swinging rebar because there's nothing tougher on the planet than a rod buster that can pull a 7-6 (we didnt do 9-5) and survive the type of work and people that job dictated.

[Gurn]

19 hours ago, 6of1_halfdozenofother said:

Wait until they start proposing paving over viable farmland in favour of new housing complexes... 

Pass a law stipulating all new build housing must have a roof structurally sound enough to support a garden on it.?

[taxi]

On 5/16/2023 at 5:25 PM, Elias Pettersson said:

Building row townhouses right in the city isn't affordable for the average person.  Also, they're not as profitable for the builder.  Those lots on Nanaimo street are actually already zoned for multi-family.  Every lot in Vancouver is now a multi-family lot.  Problem is you are not getting 3 row townhouses plus a coach house on a standard lot.  A developer would end up building a front and back duplex with a suite.  Then sell off each side of the duplex, so 1/2 duplex for around $1.5 million.

 

Like @Warhippy said, that's not really going to help the housing crisis as the average buyer can only afford $700-800k.  To afford a $1.5 million 1/2 duplex or townhouse your combined income needs to be like $300k.  And that is if you have a 20% downpayment.

 

At the end of the day, the larger townhomes need to be built outside the city to get the price down to around $1 million max.  There is lots of empty land available outside the city that can be rezoned for this purpose.  Problem is the municipal governments are dragging their feet with all of the red tape...

The market will roll downhill. If you get the people who can afford $1.5  million into a townhouse, they won't be competing for larger condos. You build enough townhouses and the price drops to $1.2 million. 

 

The major issue in Vancouver right now is the "missing middle". Lots of tiny condos and detached lots, not nothing on between. 

 

Will Vancouver ever be a cheap place to live, failing a tidal wave, no way. Can you make it a realistic place to live by increasing density and supply, sure.

 

Also Nanaimo currently requires a permit to build a multi unit home. You have to apply for the permit, give notice to the neighbors, etc... It's not automatically zoned for multi unit.

[Elias Pettersson]

17 hours ago, taxi said:

The market will roll downhill. If you get the people who can afford $1.5  million into a townhouse, they won't be competing for larger condos. You build enough townhouses and the price drops to $1.2 million. 

 

The major issue in Vancouver right now is the "missing middle". Lots of tiny condos and detached lots, not nothing on between. 

 

Will Vancouver ever be a cheap place to live, failing a tidal wave, no way. Can you make it a realistic place to live by increasing density and supply, sure.

 

Also Nanaimo currently requires a permit to build a multi unit home. You have to apply for the permit, give notice to the neighbors, etc... It's not automatically zoned for multi unit.

All single family lots will become multi-family lots in Vancouver as early as 2024...

 

https://dailyhive.com/vancouver/vancouver-multiplex-single-family-zoning-rs-proposal

 

City of Vancouver proposes allowing multiplexes for all single-family neighbourhood zoning

 

They are even looking at doing it across all municipalities...

 

https://dailyhive.com/vancouver/bc-single-family-lots-secondary-suites-densification-policy

 

Up to four homes to be allowed on single-family lots across British Columbia

 

With this new legislation, they could build smaller units that would drop the price from $1.55 million to around $1.1 million...

 

Based on the City’s calculation using conventional input costs and average rates, a fourplex unit would carry a $1.1 million estimated purchase cost, with 39% of the house cost, $221,000 for the 20% down payment, and a combined household income requirement of $235,000 annually.

This fourplex unit scenario on a lot is comparatively more affordable than a duplex unit with an estimated $1.55 million purchase cost, and with 55% of the house cost per unit, $310,000 down payment, and an income requirement of $326,000. Single-family houses are, of course, even more out of reach, with an estimated $2.82 million estimated purchase cost, and 100% of the house cost per unit, $563,640 down payment, and $586,000 for income required.

The densification would apply to all single-family zoning across Vancouver to ensure the policy is simple to understand for both builders and City staff reviewing applications, eliminating a major source for confusion. This distribution also better enables building opportunities, and the management of the impacts to utilities.

 

This is still unaffordable for the average family, but if they could get builders to build out thousands of these new smaller units then there is the potential to get the price even lower than $1.1 million.  $800k I think is the sweet spot IMO.  This way, young families don't have to rely on buying a 2-bedroom condo in a high-rise in order to get into the market.

[taxi]

5 hours ago, Elias Pettersson said:

All single family lots will become multi-family lots in Vancouver as early as 2024...

 

https://dailyhive.com/vancouver/vancouver-multiplex-single-family-zoning-rs-proposal

 

City of Vancouver proposes allowing multiplexes for all single-family neighbourhood zoning

 

They are even looking at doing it across all municipalities...

 

https://dailyhive.com/vancouver/bc-single-family-lots-secondary-suites-densification-policy

 

Up to four homes to be allowed on single-family lots across British Columbia

 

With this new legislation, they could build smaller units that would drop the price from $1.55 million to around $1.1 million...

 

Based on the City’s calculation using conventional input costs and average rates, a fourplex unit would carry a $1.1 million estimated purchase cost, with 39% of the house cost, $221,000 for the 20% down payment, and a combined household income requirement of $235,000 annually.

This fourplex unit scenario on a lot is comparatively more affordable than a duplex unit with an estimated $1.55 million purchase cost, and with 55% of the house cost per unit, $310,000 down payment, and an income requirement of $326,000. Single-family houses are, of course, even more out of reach, with an estimated $2.82 million estimated purchase cost, and 100% of the house cost per unit, $563,640 down payment, and $586,000 for income required.

The densification would apply to all single-family zoning across Vancouver to ensure the policy is simple to understand for both builders and City staff reviewing applications, eliminating a major source for confusion. This distribution also better enables building opportunities, and the management of the impacts to utilities.

 

This is still unaffordable for the average family, but if they could get builders to build out thousands of these new smaller units then there is the potential to get the price even lower than $1.1 million.  $800k I think is the sweet spot IMO.  This way, young families don't have to rely on buying a 2-bedroom condo in a high-rise in order to get into the market.

If the plan goes ahead, and they can reduce the price, I'm all for it. Although I don't see the price in Vancouver proper going as low as $800k. It could easily get that low in places like Surrey, Coquitlam, etc... though. 

 

Even at the projected $1.1 million that would make huge difference, as it would then be possible to climb up from a condo into one of these units. 

[Elias Pettersson]

3 minutes ago, taxi said:

If the plan goes ahead, and they can reduce the price, I'm all for it. Although I don't see the price in Vancouver proper going as low as $800k. It could easily get that low in places like Surrey, Coquitlam, etc... though. 

 

Even at the projected $1.1 million that would make huge difference, as it would then be possible to climb up from a condo into one of these units. 

Yes, I agree.  $800k in the city is probably fantasy, but if you can get a fourplex unit in the suburbs for $800k then that should work for most people.  Alot of people are working from home now, so the need to live right in the heart of the city has diminished.  And for those that want to stay in the city, at $1.1 million they could probably squeeze that if interest rates dropped a bit.

 

Single family home builders would also get really busy all of a sudden building fourplexes, which would help with construction jobs and the economy as a whole.

 

I am surprised they didn't plan this 10-15 years ago.  It's a shame really.  We could have had thousands of these smaller homes already on the market and in the inventory cycle.  The government was too worried about foreign buyers 10 years ago, thinking if you stopped them from buying it would fix the mess.  They were wrong.  Ultimately, fixing this mess is by building more multifamily homes, thousands of them...