The discrimination discount
I got an email from a reader recently noticing that there seem to be a lot of age restricted condos in Victoria, especially those that restrict children. That’s become a significant barrier in a time of spiraling prices that have moved detached homes out of reach of most families. In this article we look at how many of our condos discriminate based on age, and what the impact is on prices.
We don’t have data on the entire housing stock so I can’t say with precision what percentage of the condo stock is under age restriction. To approximate an answer, I looked at all sales of condos in 2012 and 2013 to see how many had age restrictions and what the impact was on prices. I picked that time frame because condo prices were pretty flat to avoid confounds from rising or dropping prices. There were 2886 non-luxury condo sales in that two year period within 656 unique buildings. Here is the result.
I don’t know about you, but I was pretty surprised that a full 30% of buildings banned kids! Remember though that this is based on resales, so if condos with age restrictions are sold more or less frequently than those without, it may slightly shift the results. However because we are looking at building level data (any sale in the building over 2 years is registered), it should be pretty accurate. We are also relying on agents correctly entering the “youngest age allowed” field in MLS for these data (as an aside, if you want to monitor sales of condos just fill out this form and note your age requirements in the “other requirements” field).
Moving on to prices, here are the differences in prices between the three, for the 2012/2013 data. It’s clear that unrestricted condos consistently sell for more than those with restrictions, which is logical. Seniors only (55+) condos seem to sell for the largest discount.
However you are likely more interested in price differences today than 5 years ago. It’s a little tricky given rapidly increasing condo prices in recent months, but I pulled all non-luxury condo resales since November (n=556) and charted them below. Again unrestricted condos are clearly worth more than restricted ones, with the difference in the average price at $60-$70k for both 1 and 2 beds (Note there were only 5 sales of 1 bedroom “seniors only” condos so the average there isn’t reliable). Don’t put too much stock in the exact dollar value differences though. Condos without age restrictions are on average substantially newer and smaller than age-restricted condos, so it’s a different product. A like for like comparison would yield substantially smaller discounts but is difficult to do while prices are changing as quickly as they are these days.
Despite provincial and federal protections against age discrimination, there’s always been a curious exception for stratas that has allowed them to discriminate by age. In fact in 2009 that permission to discriminate was specifically added to the Strata Property Act and stratas have successfully enforced both “no kids” and “only seniors” bylaws. The various attempts to challenge these bylaws by residents have to my knowledge always ended in defeat.
It’s worth noting that in the recent condo sales only 22% of buildings banned kids, while 4% were seniors-only. Given newer condos are less likely to have restrictions, it’s likely that the number of age restricted condos will slowly decline over time. However with other provinces recently removing the ability for stratas to ban kids in condos, it raises the question if this practice remains supportable in BC.
What do you think? Should stratas be allowed to have these age restrictions or should they be phased out?
Your article helped me a lot, is there any more related content? Thanks!
This shouldn’t even be an issue; if it was 55+ before the government stepped in, that’s fine, but no way should there have been an allowable to do it afterwards. I see the devaluation in suites and townhouses all over the Fraser Valley, Abbotsford to Chilliwack with prices so far up to 70,000.00 of original price and they are still sitting empty. I am moving to a condo that isn’t 55+ and I bought it because it wasn’t; if it was to change now, and my investment isn’t protected as a result, I should have a recourse to recoup the loss between the same unit comparable in a building that isn’t 55+.
New post: https://househuntvictoria.ca/2022/03/01/february-market-summary/
Agree with this but I’m more hopeful on the tech side. EV transition will be rapid. Decarbonizing buildings and materials also relatively rapid (~20 years). Flights and shipping the same a bit later. We won’t make 1.5 degrees, but likely stay below 2 (assuming we don’t blow ourselves up in the meantime).
Nothing is stopping me, I just don’t try. If I want to go to Europe, I go to Europe and the environment does not influence my decision. Not going to lie or be a hypocrite.
In our lifetime (40-50 yrs) I am going to guess the opposite of you. Sure, a few things will change like more EVs (much better cars than ICEs) and less paper usage (easier to have everything on the cloud), etc. will change, but individuals will continue to be selfish as ever. After covid settles down and assuming there is no WWIII, cruising, flights, and everything else will boom. I am guessing global demand for crude goes to above a 100 million barrels per day by 2023 and doesn’t fall below 100 million per day before I die.
I do 100% believe in climate change and **** will hit the fan but probably after my death.
Probably right. Last I heard years ago the biomass plant heating was running on gas and I don’t think onsite sewage treatment makes sense when we have a district wide one now. I think a simpler approach like passive house with some solar on the roof would be more likely to sell. Less stuff to go wrong, proven energy efficiency.
$1,425,000
I trust the one country that has not condemned the death of children and civilians in Ukraine to do the right thing for the world, as they look across to Taiwan.
I interpret this as let’s focus on stuffing as many people into one building versus trying to squeak out max efficiency.
Call BC Hydro they will give you the last 12 months over the phone. Fortis unfortunately has a different privacy policy, but if the seller is not willing to provide move on to the next home.
Just finished up with the energy modelling, Final ERS and BCBC As Built construction compliance report on a new build. Added $2k to the build, built the house like any other house before. Guaranteed no buyer will ever ask about any of it.
In my entire career I can’t actually recall a buyer ever asking/mentioning/considering/etc. the environmental impact of something they are looking to purchase. If anything I’ve had buyers shy away from places like Dockside Green. Dockside Green uses an on-site biomass gasification plant to supply the development with energy for heating and hot water and it has onsite sewage treatment and is water efficient. Most buyers are like, hmmmm….I smell special assessments down the road, no thanks.
Is there a friendly HHVer that has the sale price of 1820 San Juan handy? Thanks.
I wouldn’t be surprised if China actually produced fewer emissions in 15 years than Canada. They are adopting/innovating hard. Also keep in mind they are producing/manufacturing a huge amount of goods for Canada, and those emissions should really be allocated to us.
https://architecture2030.org/why-the-building-sector/
“Buildings generate nearly 40% of annual global CO2 emissions. Of those total emissions, building operations are responsible for 28% annually, while building materials and construction (typically referred to as embodied carbon) are responsible for an additional 11% annually.”
It’s almost like there should be some graduated legislation that requires a laggard industry to improve…
I’m in agreement with you and thought I had already said as much. I’m very pro step code, but in this case I agree they have it reversed. I suspect they’re following BC Housing’s lead in requiring step 4/5 as a funding requirement.
What I was commenting on was the requirement for energuide labels for sellers. You and Leo thought it was stupid and buyers should just ask for copies of bills. I disagree and don’t mind this because (a) it provides a standardized measurement, (b) hopefully makes buyers actually think about operating costs / environmental impacts, and (c) incentivizes some folks to invest in worthwhile upgrades.
Do you get copies of these bills for your customers? Any HHVers out there get them prior to purchase? I recall one or two HHVers that were a little shocked at their bills after possession. Would sellers even provide them in this hot market?
What’s stopping you? I haven’t found it difficult to make changes at all. I’m not alone.
In reality it does and you can prioritize the big bits – like driving less and eating less meat pretty easily. Also, the wealthiest 10% of the global population are responsible for 50% of emissions (Canadians are in this category – average carbon footprint is more than double that of a Chinese person) and your actions influence a lot of people around you. We should all be aiming to be beneath the max per capita emission number needed to slow global warming. Pointing to China in the midst of a pants on fire emergency as a reason not to reach for a fire extinguisher is ludicrous.
My guess is that in our lifetime we’ll see a dramatic shift in attitudes towards transatlantic flights, gas powered anything, consumerism, and a focus on individual carbon footprint responsibility. It will speed up with more climate change events. Inevitable and visible ones like ocean acidification and hypoxia leading to massive shellfish die-off in BC and knock on effects, plus a lack of arable farmland in many areas of North America due to drought.
Perhaps the three things that matter in property: “location, location, location” have changed to : “location, house age, house size” after people started WFH?
945k
Marko – what did the Mariner townhouse you had for sale in Royal Bay sell for this week?
But we aren’t doing densification and missing-middle housing. Just talking about it and complicating the economics of it with the Step Code. It will be 5 or more years before the first keys are handed to a missing housing middle project unit. Why add Step Code 5 to it? You discourage the density from happening based on saving $2 per month per unit over a Step Code 3 townhome. Putting four families on one lot, for example, should take all priority over trying to pick off the small stuff.
And I disagree with you and Leo that “every little bit helps.” It reality it doesn’t. Look a China’s emissions compared to Canada. Canada is a small fraction. Then multiply that small fraction but some incredibly small fraction of doing something like Step Code 5 or trading your white Audi Q5 with Thule carrier for a white Tesla Model Y with a Thule carrier. The two fractions multiplied equal a decimal and a lot of zeros.
If we want to move the needle, need we need to make some actual changes like have less kids, live in much smaller spaces, get rid of cars, etc. Reality is we can’t even do the most basic things. You can’t even buy a Honda Fit or Toyota Yaris in Canada anymore. Pick-up trucks/SUVs best sellers, but everyone is concerned about climate change as long as they can sit a bit higher in their SUV in gridlock traffic.
They are factoring the environment into the decisions they want to factor the environment in. Like who decides not to buy a puppy because of an environment decision?
Purchased in 2016 for $618+GST. Royal Bay is the place to be! 1,878 sq/ft home for $1.45. You have livable houses in Oak Bay that sell for not too much more.
If you need a place to live earlier the better imo; however, as an investor I always look for longer the better for completion. My goal is to find something approximately 5% below tangible product (i.e., near new building close by) with the longest possible completion.
Example,
Purchase $500k pre-sale when tangible product is $525k. 15% down = $75,000 deposit.
If the completion is three years out and the market statistically appreciates 4% per year $525 x 1.04 per year = 590k so potentially a 90k uplift on a 75k deposit, that is over a 100% return. Of course, the market could tank but it is a reasonable statistical gamble. I’ve also had units appreciate over 50% during construction. If everything goes to crap and the market tanks and unit is 450k on completion just rent it out and hold.
Problem was for a couple of years there was nothing at 5% below tangible product but an opportunity opened up in October and November 2021 where the condo market took off (as correctly predicted by Leo) and a number of developers were slow to raise their pre-sale prices (Nest, Dockside, Pacific House, etc.). Now we are back not nothing below tangible product so you really have to gamble on the appreciation with no buffer.
Accepted offer, price not reported yet.
$1.45M
Could someone share what 3502 Sparrowhawk Ave sold for? Thanks so much!
How did I end up on the car fire Victoria site?
In terms of Florence lake and your views try to remember that trees in Victoria grow at the rate of one to one and a half feet per year. If the trees are on a neighbours property they may have a vested interested in keeping them tall. I dont know about Florence Lake in particular but I had a friend whose water view disappeared after about eight years and that impacted the value. A little thought and foresight goes a long way.
Re : car fires
I can’t comment on electric vs ICE but the popular TV portrayal of a car goes off a cliff, crashes and bursts into flames is way off base. As somebody who has spent too much time wandering around in auto wreckers I can say that completely or even partially burnt cars are very unusual. Even 1% strikes me as too high. It does happen but a short that melted a wiring harness and went out would be a little more common, considered an electrical fire, and just as likely to write off the vehicle.
My final word on electric vehicles- if you’re ever near one that is on fire, run like hell. They emit deadly hydrogen cyanide gas. Wouldn’t want to be the firemen trying to extinguish it.
Flights from Vancouver to Toronto were $83 each way, a few days ago. The carbon tax is way too low, IMO.
I’d just hold and wait for the market to normalize before jumping. You basically have zero risk in waiting. If the market crashes it doesn’t matter since you’re already in it, and buying conditions can only get better from here on out. Or could unload one now into the mania to try for an irrational bid then hold on to your primary residence to trade up later.
Unless I am not in the loop like we’ve run out of concrete form workers why would a concrete building take much longer? I understand the typical concrete project takes a year longer but that is a function of a much more complicated excavation (deeper) and extra floors. However, if you take one level of concrete parking and 6 stories of wood vs one level of concrete parking and 6 stories of concrete, I doubt there would be more than 3–6 month difference. Concrete forms go fast.
As someone who shows hundreds of condos every year, I am a massive massive fan of concrete. Spending more than half a million and then hearing the person walking above me would drive me nuts. Just take a look at the building Abstract is framing at the corner of Hillside and Cook and then take a look at Dockside Green. One is basically toothpicks and the other one is steel and concrete. I also find that beyond the concrete the specs are better all around. For example, steel stud staggered walls vs 2’4” staggered, most concrete buildings have central hot water versus wood frame often they stick the hot water tank in your unit, etc.
When I look at wood-framed pre-sales in Langford right now vs downtown/Vic West the premium for concrete + better finishing + much better location is only approx. 20%. Assuming you can afford I would rather be in concrete in walk-able Vic West versus in a non-walkable woodframed with a commute to downtown.
Personally I think the premium for concrete should be much bigger, but it isn’t, so I kind of see it as “good value.”
Seeing a few realtors in Van saying prices are over the peak in some segments. Steve Saretsky recently tweeted ‘suburban house prices have definitely peaked for this cycle’. I’ve seen a few other realtors sharing similar sentiments on Youtube – all anecdotal thus far. Of course it could go like last summer where it seemed things were stalling out and then we had a boom but this time in the face of rising interest rates it may be more likely. Just wondering if any realtors on this board are seeing anything similar in Victoria yet? I know our markets aren’t directly correlated and likely we would lag but curious all the same.
It isn’t just a matter of time but also market value. A younger population in the strata would not want to sink the market value of their units with restrictions as they are most likely hoping to upgrade to a SFH at some point. An elderly population in a strata doesn’t care as much if restrictions tank the market value of the units.
I live in three-year-old building with an older population and the stupidity is brutal. They’ve tried so many idiotic bylaw amendments. For example, they wanted to introduce a two-person max occupancy limit for one bedroom units (only 20ish one bed units out of 134, what problem are we addressing?). So young couple gets pregnant and has to leave, but you can have two people + two Great Danes in the one bedroom? That make sense. Also, if I suspect three people live in a one bedroom next to me, then what? We launch an investigation?
There are a couple of local law firms the cater to strat bylaw amendments as I see their names coming up all the time in all the different strata buildings I review for clients. They convince the stratas that their bylaws need to be amended, copy and paste from the previous strata they did, and send huge invoices. The strata council volunteers usually don’t have any common sense to know any better. I wanted to use the gym during COVID so my strata hired a law firm to try and deny my request. $5,000 worth of strata legal fees later they let me use the gym.
thoughts on upgrading to a better/more stablished neighborhood. We own 2 houses that would sell for ~1.4 each. one is tenanted and one we live in.
If we sell one we could buy in the 1.8 range – and ideally have a suite to rent out. If we sell both we could get into the 2.5 -2.7 range with or without a suite.
The problem is we are leery of selling before buying due to rapidly escalating prices and what if we don’t find anything we want to buy after selling one home.
Subject to sale of 2 homes seems pretty undesirable to a seller, but maybe not in that 2.5-2.7 range? considering how fast homes sell in the 1.4 range. Hope this makes sense.
“Research by another firm, AutoinsuranceEZ, says battery electric vehicles have just a .03% chance of igniting, compared to internal combustion engine vehicle’s 1.5% chance. Hybrid electrics, which have both a high voltage battery and an internal combustion engine, have a 3.4% likelihood of vehicle fires according to their study.”
https://www.cnbc.com/2022/01/29/electric-vehicle-fires-are-rare-but-hard-to-fight-heres-why.html
The issue with it is everyone grows old and youself would hit that age limit too and are forced to sell and move out sooner or later ;-). It maybe more harmful to the society that way.
The removing age restriction city link Leo posted actually removes all age restrictions except age 55+ ones.
Anyone know the sale price for 1050 Thistlewood Dr?
Interesting idea. It’s never the builders that implement these conditions though, it’s the crotchety condo board members. If a relatively young condo board could implement a no seniors rule and then hit the news about it, that might actually start the right conversations to strike down age discrimination laws. But what young person has the time? I wouldn’t grandfather individuals – these condos that don’t allow kids have actually kicked people out of the home they own for the grievous sin of procreating. Kicking people out for the grievous sin of aging properly highlights just how absurd these rules are.
“Looked at the Florence Lake pre-sale. Need to keep in mind that the first four floors don’t have views of the lake despite facing the lake. You have to go up to the top floors and those are the most expensive units obviously.”
Thanks for this Vic&Van. I’m sure many don’t know this and will pay the higher price to not face the road, but then to arrive with your couch and patio furniture and not have those water views might be quite a surprise.
Also if you are senior (myself included), no need to artificially prolong your life, especially if you have dementia or other terminal diseases after age 75. Spending old age lying on bed for years before death is not only wasting resources and bad for the environment, but also is no fun for yourself.
20% higher sales than the 10 year average in February with 64% lower inventory. New post tonight
Looked at the Florence Lake pre-sale. Need to keep in mind that the first four floors don’t have views of the lake despite facing the lake. You have to go up to the top floors and those are the most expensive units obviously.
Note wood frame construction and two year time period. Concrete would probably take four or five years to complete. Some would say there is less risk with an earlier completion for a pre-sale others say take the longest completion date for a pre-sale. I am getting mixed thoughts from different realtors on that topic.
Just wait until you hear about the 240V going into your house
“Are there any actual house hunters left on this site? I’d have thrown in the towel seeing places like Dunlin St sell for prices like that.”
Yes, still keeping an eye out and visiting open houses (it’s nice having them back). Speaking of which, the a recent pre-sale opportunity I’ve seen in the Westshore is at The Lookout at Florence Lake. Anyone have any thoughts on the developer, pricing, location, etc. or have looked into them? I see they’re selling quickly with occupation in 2024.
1350 is ideal. 3 bed, 2 bathrooms, but could easily do 2/1. No need for an office, but yes I do work from home. No need for a 2 car garage, since the current one car gets less than 10k a year on it which is mostly taking kids to sports.
Agree.
Individuals are in charge of many decisions that contribute to climate change and that impact is not negligible and what you do affects those that know and interact with you. Social scientists have found that when one person makes a sustainability-oriented decision, other people do too. You personally can have fewer children, eat less meat, take fewer flights, drive less, buy used, buy local and can buy carbon offsets.
Per capita emissions must reach 2.1 tCO2e by 2050, if warming of the planet is to be kept below 2 °C. An individual who eats meat and takes one roundtrip, transatlantic flight per year emits 2.4 tCO2e through these actions alone, exceeding their personal carbon budget, without accounting for any other emissions.
If you are looking for the highest impact actions, here you go:
having one fewer child (an average for developed countries of 58.6 tonnes CO2-equivalent (tCO2e) emission reductions per year),
living car-free (2.4 tCO2e saved per year),
avoiding airplane travel (1.6 tCO2e saved per roundtrip transatlantic flight)
and eating a plant-based diet (0.8 tCO2e saved per year).
https://iopscience.iop.org/article/10.1088/1748-9326/aa7541
That’s true for everything. What matters isn’t what you really want, it’s what you can pay for.
Electrical malfunction is one of the most common causes of vehicle fires. That’s with a 12 volt system. Your typical EV carries a 400 volt system. It’s your choice.
If I wasn’t a Fatigued Buyer before, I am now. Getting priced out of Royal Bay has put a hold on our home search.
I hardly go downtown any more. It is too depressing having to see all the homeless souls warming themselves around the burnt out husks of Teslas.
I do disagree with this. It feels to me like you’re saying it’s not worth cherry picking the easy items because they might not have as much impact, when in reality every little bit helps. I’m saying that there are many not-too-difficult things we can do in addition to pushing for densification and missing-middle housing. It’s not either/or in my mind.
At least they’re factoring the environment into their decisions. This kind of comment makes me sad.
For the record, the majority of the passive houses in Victoria are MURBs (because that’s what PH promotes). The few SFHs are all under 3000 sq. ft.
@james if 1500 is straight to selling I’m just wondering what your ideal sq footage is. More importantly, family size and if you need an office matters when the floorplan shrinks.
Marko, don’t you think you’re being a little too pessimistic about the general population…(reads more comments)…
Maybe Marko’s got a point.
@2wheels why?
not that I care that much, but introvert is particularly creepy.
It sold in September for $1,050,000. If you’re looking at it on Zillow it’s a bug.
@jamessoper what’s your ideal sq ft and floor plan? How many people / do you work from home?
What you are saying is gas powered cars are 60x more likely to catch fire because they tend to catch fire in an accident? This would mean a fire breaking out while the occupants might be unconscious or injured. However, what concerns you is a spontaneous EV fire during which the occupant can exist the vehicle?
Thank you for the story of the Tesla that caught fire in Pennsylvania. There is also a Tesla Model S that caught fire in Shanghai in 2019. There was also a Tesla fire in Los Angeles in 2018.
Anyone have a guess to why 1024 Tolmie hasn’t sold? The location doesn’t seem like it would be a deal breaker given everting else that’s selling. Thanks
Lots actually. Hybrid cars are the most likely to catch fire, gasoline cars are second, and electric a distant 3rd.
If someone gifted me an over 1500sq place, I’d sell it and buy something smaller. Also a single car family. Maybe we’re the only people here that feel that way.
The fact that there are a much higher percentage of gas powered cars on the road that could catch on fire after a collision skews the data. How many gas automobiles spontaneously burst into flames? The EVs I’m referring to spontaneously combust, like some smartphones. Some of the cars on that ship produced 600-800 horsepower. The batteries are also extremely powerful and far more volatile. But hey, we all need 200 mph cars. The fact remains that some of the cars caught on fire and were next to impossible to extinguish.
Actually, what they really want is 8000 sq feet on a half acre lot. Waterfront lot is on the list as well.
Only because they can’t afford what they really want which is 2,500 sq/ft + double garage + 6,000 sq/ft lot.
EV fires are harder to extinguish due to lithium-ion battery packs but EVs catch fire at a very small fraction compared to ICEs. Latest data I’ve seen from National Transport Safety Board noted 25.1 fires per 100,000 EV sales compared to 1,529 ICE fires per 100,000 sales respectively. That is 1/60th.
A Tesla will catch fire in New York or a Taycan in Florida (https://www.caranddriver.com/news/a30986407/porsche-taycan-ev-fire-garage-florida/) and it is all over the news/internet. ICE catches fire on the Pat Bay Highway doesn’t even make local news.
Fires can happen on ships even without electric cars on board, just last week huge fire on this ferry with 8 dead -> https://www.usatoday.com/story/news/nation/2022/02/26/greece-ferry-fire-death-toll-rises-8-after-six-more-bodies-found/6952736001/
Yes there was a lot of EVs on that ship. Porsche’s, Lamborghinis, Bentley’s, Audi’s, VW owns all those Marques. But what would a dumbass like me know.
Volkswagen has confirmed that there are electric vehicles on the ship.
The lithium batteries used by electric vehicle are a far greater fire hazard than the lead-acid batteries used in gas vehicles.
In fact that was regarded as a pretty good sized house for a family in the postwar years, and many families had more than 4 members. Many houses were smaller than that, such as the classic postwar bungalow, which can still be seen across the country.
And I’m sure that if you built family accommodation of 1,200 sq/ft today, more likely duplex or row housing, there would be buyers.
https://modernrealtor.blogspot.com/2020/11/the-small-post-war-1-12-storey-house.html
Are there any actual house hunters left on this site? I’d have thrown in the towel seeing places like Dunlin St sell for prices like that.
Yes, housing market seems invincible. I don’t have skin in the game in terms of buying/selling, but will be interesting to see if these price gains survive (or at least slow) due to inflation/rates/Russia over the next 6 months. I hope the BOC doesn’t use the Russia crisis as an excuse to keep rates low and keep money printing.
LOL, well said!
Purchased May 2019 for $738k+GST. What is that like $800 a day tax free for the privilege of living in a brand-new house? Makes sense 🙂
This is the argument Tesla fans use when lobbying no luxury tax on Teslas. The argument is it might sway someone from buying an expensive AMG Mercedes or BMW M car into a Tesla…..and I think the argument is non-sense. The government actually caved a bit and for the 2022 budget increased the threshold for the luxury surtax on new ZEVs to $75,000, up from the previous base of $55,000 when there are some amazing EVs under 55k.
I too don’t think we are going to change society or human nature and there is no political will to do. Who is going to run on a platform of let us find a away to house families of 4 in 1,200 sq/ft to help out the environment? Would get 1% of the vote. Everything I invest in is based on the premise of I don’t have faith in humanity to change because people are selfish. I buy companies like CN Rail, for example, because I figure even the Prius driving environment loving hippy needs their kayak shipped one way or another, along with the Prius roof bracket for the kayak, and everything else.
“VW recently lost a ship full of 4000 new, expensive automobiles at sea due to a fire onboard. The cause of the fire was not disclosed. I wonder if one EV battery spontaneously burst into flames, destroying the entire vessel and $400,000,000 of automobiles. Not very environmentally friendly.
Ev battery fires are extremely difficult to extinguish and in a tightly packed vessel, impossible. I think I’ll stick to good old gas powered vehicles.”
This comment is beyond stupid. Was there any EV’s even on the ship? Also each gas vehicle has a battery in it that could also catch fire or start a fire. Just mind numbingly stupid. But then again you are a fake doctor so this shouldn’t surprise me.
You’ve found the increase in “units added to rentals” and you got that part right.
Where you go off the rails is assuming that this is because of the spec tax.
Because there’s a more obvious explanation, namely more investor/landlords buying homes, and adding “more units to rentals”
And as we can see, Vancouver has seen investor purchases rise from 18% (2016) to 21% (2021) of purchases.
For example, There were 40k homes sales in Vancouver in 2021, and if 21% of them were investors, that’s 8,400 investor buying homes. So it’s not surprising to see that 7,000 units have been added to rentals, and many may be from investor buyers, and few from the spec tax.
Moreover, there have been rises of about 5,000 in years before the spec tax, so “units rising from rentals” obviously doesn’t mean “because of the spec tax”. It’s just likely measuring investor buyers.
One thing we do know for sure, is that investors (speculators) buying has increased since the spec tax was introduced. The spec tax was supposed to reduce that spec buying, yet it got worse. Yet now when we see investors buying up homes, adding to the numbers of rentals, it gets heralded as a great thing,…”more unit rentals must mean the spec tax is working” ! Because apparently we don’t care about speculators buying homes, unless they’re leaving them vacant (which they were never doing anyway, because they’re not that dumb).
Remember, here’s what the government told us when they brought in the spec tax. And there were supposed to be less investors buying, not more.
BC Govt introducing the spec tax: “Speculation has contributed to runaway prices and made it difficult for British Columbians to find a home they can afford. The tax will push speculators out of the housing market. Homes are for living in, not vehicles for investment”
The point being: Speculation has got worse since the spec tax. That’s why I think the spec tax is a flop. And it should be replaced by an actual speculator tax – taxing “flippers” that sell within 5 years
To summarize then, we have decent evidence that the spec tax has returned vacant units to the market, from anecdotal accounts, from CMHC rental data, from spec tax data showing declining vacancies, and from the census showing declining rate of vacant units. You dismiss all this data.
Meanwhile we have no evidence that it has damaged the BC economy and yet you believe that part firmly.
Confirmation bias folks. It’s a hell of a drug.
VW recently lost a ship full of 4000 new, expensive automobiles at sea due to a fire onboard. The cause of the fire was not disclosed. I wonder if one EV battery spontaneously burst into flames, destroying the entire vessel and $400,000,000 of automobiles. Not very environmentally friendly.
Ev battery fires are extremely difficult to extinguish and in a tightly packed vessel, impossible. I think I’ll stick to good old gas powered vehicles.
CMHC does a secondary market survey in October/November captures the other types of rentals. This data is incorporated into the rental market survey report, (though not in the primary vacancy data)
“My point is that there is no data from the CMHC rental survey data that says that 18,000 units have flooded into the market because of the BC spec tax.”
And my point is that CMHC only surveys the primary rental market, and a portion of condo apartments in select cities. If 18,000 rental units were added to the secondary market, CMHC wouldn’t capture it.
$1.572M
“My point is that there is no data from the CMHC rental survey data that says that 18,000 units have flooded into the market because of the BC spec tax. In fairness, the BC government have only said that their policies like the spec tax “helped to encourage” the rental market, so they backed off saying that the spec tax actually made any of this this happen.”
There is no data because I highly doubt they can track it. Does anyone know how or if any of the declarations are followed up on? I get envelopes in the mail to properties telling me call and declare if they are rented or vacant. I call, I speak with someone that verifies they’re talking with me and then I simply say yes, those are rented. It’s the only contact or touch point I have all year. Maybe some government employee is driving around with a clipboard checking for cars in driveways or lights in condos, but I doubt it. I feel like a bigger reason for it was for tax purposes to ensure people were claiming rental incomes.
Can someone share what 3467 Dunlin St sold for? Thanks!
Rental vacancy is low and has worsened in all sectors – SFH, condo etc. I don’t think it would be materially different in primary vs secondary.
My point is that there is no data from the CMHC rental survey data that says that 18,000 units have flooded into the market because of the BC spec tax. In fairness, the BC government have only said that their policies like the spec tax “helped to encourage” these 18,000 additional rental units, so they backed off saying that the spec tax actually made any of this this happen. The original HHV poster ignored all that and simply declared that this 18,000 rental units added meant that $2.7 billion value was created by the BC spec tax in converting these vacant homes to rentals. My opinion is that the spec tax has had a much smaller impact, as measured directly by analyzing the spec tax declarations that we all file. Moreover, I think that taxes like the spec tax and foreign buyers tax damage the BC economy, and overall have a negative effect. This has to be weighed against the benefits, and I have yet to see the benefits of the spec tax.
To be clear, my main objection to the BC speculation and vacancy tax is that it doesn’t tax speculators. There should be a tax on speculation, with heavy taxation at time of sale if properties are flipped in a short period of time (<5 years). We’ve missed the opportunity to actually have a spec tax, partly because we have the government (and its supporters ) telling us how great and effective the current spec tax is, when it is actually a flop
That comment is an example of what I’m talking about . People don’t even call it a speculation tax anymore – they drop the speculation part, and just call it a vacancy tax. They forgot all about the original point which was to tax speculators, and just call it a vacancy tax, and think we should tax only the few vacant homes that there are. What happened to taxing speculators?
Bottom line says he’s a winner. Who cares what the media say. I speak as a Honda Fit owner.
That’s why a market based policy (i.e. carbon tax) is best.
Invest in a building with excellent soundproofing. Not sure if devs market their STC ratings?
It’s true. Though given we aren’t changing society or human nature anytime soon I’m fine with wealthy people driving Teslas and Taycans and building oversized passive houses rather than driving G wagons and building oversized inefficient homes. All dwarfed by their aviation emissions no doubt but everything helps a bit.
As a Tesla owner I can’t stand majority of other Tesla owners for this very reason. They think they are better than the Yaris owner, but they aren’t.
Then they lobby idiotic crap like EV rebates (when demand exceeds supply without rebates), there should be no luxury tax on Teslas even thought it is a luxury car, etc. When I bought my Tesla for a 100k the BC Government sent me a 5k rebate….what a joke. I would have bought it either way.
Most age restrictions are 18/19+ and 55+. But there are a few odd ones, like 35+, or 45+.
Since our society glorifies consumption it is not surprising that the media celebrates climate change “solutions” that involve consumption of shiny new objects whether fancy electric cars or “green” trophy homes. Meanwhile the fellow who drives his Yaris 5000 km a year is just a loser who needs to get out more and buy a better car
I think there is an easy solution…..see below 🙂
Build it in Sidney with extra wide hallways, doors and walk-in showers. Bylaw is you have to be under 40 to buy in and then you are grandfathered. I have a feeling the outcry would be so huge that all age-discrimination would be struck down.
Problem is money talks and that will never happen. The reason all new buildings have zero restrictions is developers like money and zero restrictions means highest market value.
“Remember, if the spec tax was working the vacancy rate would be be HIGHER.”
The vacancy rate is a measure of vacant rental units in the PRIMARY rental market, i.e., purpose built rentals, which makes up about 30% of rental supply. No reason to think the spec tax would affect the vacancy rate for rental units in that sector except maybe in an indirect manner.
I can’t see how in this day and age we can continue age-discrimination in housing. I can’t wait for these laws to be struck down.
Kenny my preferred solution is a SFH with decent fencing. That way I dont have to deal with yappy childish neighbours either. Actually lots of younger families in Sidney these days. We were up there a couple of days ago and a fair number of baby carriages were out parading about. As a young family I would prefer to be in Sidney rather than most places in Victoria.
Designed to protect the masses who can’t do 5 minutes of research? I’ve had an EV for 7 years now. My next car is going to be an EV. If I am concerned about range am I going to trust a sticker on the car or one of the many real life real condition tests done on YouTube?
I would trust this guy and many other YouTube channels -> https://www.youtube.com/user/bjornnyland any day before a sticker.
I would use the same common sense when purchasing a house. Is it a single senior or family of 5 currently living there? Obtain Hydro + Fortis costs. If they are within reasonable roll with it, if not investigate further. I don’t need a government mandated sticker.
We are in the middle of a housing crisis + climate crisis and density should be the focus, not bureaucracy in my opinion. How does it make sense if you want to build a SFH in the COV you can do Step Code 3 but if you want to do four townhomes on the same lot under the missing middle initiative it will have to be Step Code 5? Should be the other way around.
I personally feel like many are missing the big picture when it comes to climate change. The biggest picture is population growth and that problem is very difficult to compensate for in other ways. For example, 1 million people driving hummers with zero regard for the environment are irrelevant if you add a billion to the global population even if that billion is living “environmentally friendly.” Even the biggest hippies driving Priuses consume like crazy. Then you get to the lower picture stuff and the most passive SFH can’t make up for people living in smaller multi-family spaces close to amenities not commuting.
No one is talking about people buying a unit to rent out. I said turning a vacant/mostly vacant home into an occupied one represents value. It’s +1 supply, similar to building a new one.
Not sure who you think you’re arguing with here. I’ve written several times that vacant homes aren’t the huge problem some people think. But there is good evidence that a vacancy tax reduces empty homes. There’s also good evidence that there aren’t many vacant homes left. Drawing the conclusion that therefore we should abolish the vacancy tax is completely illogical.
Personally I would pay a premium not to have to deal with kids or yappy dogs.
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Just move to Sidney or Parksville/Qualicum Beach.
I remember when I first moved to Victoria over 20 years ago, one of my first days at work I had to visit Sidney and it felt like I was visiting the set of the movie Cocoon. I personally would never want to live in a seniors only complex, but then again you will often find me playing with the kids outside.
The number of units in the rental market is affected by many factors, investor participation vs owner occupier being the main factors.
How can you attribute that to people renting out homes to avoid the spec tax?
Sorry, but If an investor buys a home and rents it out, it does add a unit in the rental market, but this doesn’t “add $300,000 of value” as you have used on your napkin math to measure the spec tax value.
There just aren’t that many vacant homes out there – well under 1,000 in greater Victoria. You need to find a new bogeyman.
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…I think you may have lost the plot a little…
What’s your take on Monroney stickers?
They aren’t looking at changes in the vacancy rate so none of your comment makes any sense. They are looking at changes in the number of units in the secondary rental market.
OK, let’s do the napkin math. And I’ll show you why your number is “garbage”.
Let’s start with the 18,000 number you write down on your napkin.
The government hasn’t even claimed that 18,000 number is from the spec tax. This is just you doing that
The governments “18,000” claim is just from the CMHC rental report. And it’s just looking at the overall vacancy rate. The government statement is that “that various government policies, including SVT, helped encourage the owners of 7,137 condos in Metro Vancouver to rent them out in 2020, on top of 11,118 in 2019.”
You know that changes in CMHC vacancy rate aren’t attributable to any government policy, let alone all because of the spec tax – it is the supply/demand factors in the marketplace. It is simply garbage to assign any/all of this to the spec tax. Remember, if the spec tax was working the vacancy rate would be be HIGHER. So the government sees that LOWER vacancy rate as an illustration that their “various government policies, including the SVT” are helping. Just read what they said (below)
Someone needs to explain to the government that lower rental vacancy rates are BAD, not GOOD, and are not an indication that their various government policies are working
https://news.gov.bc.ca/releases/2021FIN0071-002129
“ The SVT also continues to deliver on its goal of ensuring housing is used for homes, not speculation, with the Canadian Housing and Mortgage Corporation (CHMC) Rental Market report released this year showing that various government policies, including SVT, helped encourage the owners of 7,137 condos in Metro Vancouver to rent them out in 2020, on top of 11,118 in 2019. Over the two years, more than 18,000 vacant units are now providing much-needed homes to families across the region.”
BCREA pushes back against the cooling off period, recommends replacing it with a mandatory 5 day posting period before offers can be entertained + more required transparency on what documents are included in a listing (strata info mostly).
They also don’t recommend removing blind bidding, in favour of registering number of offers with the brokerage so that buyers can verify afterwards.
https://www.bcrea.bc.ca/wp-content/uploads/BCREA_BetterWayHome_WhitePaper.pdf
Of course they have an agenda here but the mandatory pre-offer period isn’t a bad idea with likely fewer unintended consequences than the cooling off period.
On blind bidding they cite research that getting rid of it won’t decrease prices. I’ve read that research and it’s pretty convincing. Definitely if the province sells removal of blind bidding as a way to control prices they are wrong. But IMO still worth doing just for consumer protection.
At least the feds are way ahead of BC government on eliminating wasteful postal mail. CRA now has one-click opt-in to get all correspondence by email instead of postal mail. BC govt should contact them and ask for help on how to do this.
Feel free to do your own napkin math.
Turning vacant homes into occupied homes is value in my book. The alternative is building new homes hence the estimate. But quibbling over the figure is missing the point.
We have a vacancy tax that produces some revenue, makes some homes available to live in, lays the necessary groundwork for supply side reforms, and is quite popular. Now you are arguing it’s a bad thing and we should get rid of it? Good luck.
You’ve taught us when it comes to housing data, “garbage in, garbage out.” So it’s time to call you out when you invent this number of $2.7 billion of “value” created from the spec tax. And, in contrast to the other well supported data that you present to us on this great blog, this $2.7 billion number comes across as “garbage”.
Seniors should be in efficient (smaller) apartments instead of condos. They should have long term rental agreements to ensure stability. Close friends of mine are selling their house and moving into an apartment. It allows them to put another $500,000 into investments or use it to increase the quality of their life. This would also put more properties on the market.
The apartments should be senior restricted and built in the form of a complex that offered a variety of amenities that create a sense of community, not isolation.
Dude sign me up
It would be fun to create a strata corp that banned seniors, unless they were grandfathered in.
Personally I would pay a premium not to have to deal with kids or yappy dogs.
I dunno how much does it cost to mail a letter. 50 cents in bulk? Doesn’t seem like a big deal. Sure, could have an email opt-in but then likely more people wouldn’t get them and cause other problems.
Agreed it’s probably not cheap and would be interesting to see the direct costs, though at least at this point I’d be pretty shocked if it wasn’t positive revenue
Direct revenue is just one of the values. They claim 18,000 homes moved from vacant to occupied. Even if that’s a 100% overestimate that’s $2.7B in value compared to building 9000 homes at $300k each.
Fair enough, good point.
Definitely a factor. I didn’t control for it in this article because I was more interested in what proportion of condos are age restricted rather than the price difference (which isn’t really that important to know), but I’ll add that note to the article thanks. Looking at the last 750 condo sales, the average unrestricted condo is 2002 built, but the average restricted condo is 1983.
That’s a big difference, but then other things come into play. The average unrestricted condo in that sample is 856 sqft, but the average restricted condo is 1074 sqft. So there are tradeoffs.
I can google how much they raise 🙂 When they are smart enough to send out 1.6 million envelopes via mail in this day and age who knows how much they are paying contractors to setup the websites/databases and all the other crap, not to mention the staff, leasing top notch office space downtown, etc. I would be curious to see the breakdown.
I agree on this point.
Definitely. It raises about $80M a year.
More importantly it enables to province to go ahead with zoning and land use reforms that are coming. That is the primary value.
Heck they shouldn’t be driving an ICE car, and drive an expensive (made in China) battery car that was charged by solar panels or ride a bike 1/2 day to write an exam would surely save the trees/environment, because they wouldn’t have the energy to waste precious resources to build a home.
And, those gullible lemmings will keep on being mouthpiece for the corporate green elites to take money from the poor though higher carbon sin taxes while the rest of the unwashed starved, homeless, and burn due to energy insecurity.
Yes, let’s add more useless bureaucracy in the middle of a housing crisis. Why just not call BC Hydro if you are concerned about how much energy the home consumes? Fortis won’t give 12 month average over the phone but you can simply ask the owner.
The cool thing about it is if you build a 5,000 sq/ft passive home with 4 bedrooms and 7 bathrooms in East Sooke on 5 acres with two Teslas parked outfront you can pat yourself on the back of being socially responsible with your impeccable energy audit “green home.”
Other than a complete waste of $1.6 million how am I supposed to take the government seriously when they talk about the climate crisis, and they print off 1.6 million envelopes and letters when likely around 1.5 million could be sent via email. Then if I recycle it gets sent to the Philippines anyway.
Also, has anyone investigated how much it costs to administer the spec tax program? Does the revenue even cover the costs?
I’ve heard from people taking the owner builder exam that had to drive 5 hours in each direction to a testing center to write a completely useless government mandated exam, so unfortunately there are even stupider unproductive hours of people’s time and resources.
The executive who brought in the useless exam in BC is now the new CEO of the Home Construction Regulatory Authority in Ontario, so look forward to completely useless owner-builder exams Canada wide. Seven years into it not one piece of literature from BC Housing as to how this exam has done anything to improve quality of owner built homes or how it has helped to protect the consumer. Only in government can you get promoted implementing completely useless ideas.
100% age restricted condos sell for less, along with pet and rental restricted; however, are you controlling for Yr. built? I would think average age built for unrestricted would be substantially newer than kid restricted and senior only.