November: Opportunity knocks softly
November has wrapped up and conditions in the real estate market are very similar to a year ago. Just like in 2022, high rates have brought prices down a bit from the spring, while market conditions are between buyers and balanced territory depending on what measure you look at. At the same time, bond yields underlying fixed rates have been in freefall for a month, which could start to bring back buyers just like it did a year ago. Meanwhile the biggest land use reforms have likely changed the trajectory of the market, but those changes (if they even work as intended) will take years to gather momentum. In the short term they are a minor factor at best.
Though sales at 394 slightly outpaced last November, we remain at the extremely slow end of the scale for market activity. In the last 40 years, the average November saw 531 sales, and 394 is in line with the very slow market a decade ago (366 sales in Nov 2012 and 381 a year later). Back then though we had over 4000 properties on the market, vs 2644 right now. Though the market is slower than it has been in years, it has been a lot slower in the past.
On a seasonally adjusted basis, condo sales slid a little from October while detached and townhouses strengthened a little, but neither made big moves.
This is clear when you look at total sales which were roughly unchanged from October. As I’ve mentioned a few times, if there’s any further weakening to come it will be from building inventory, not further slowing of sales (which are more likely to recover somewhat).
New listings are doing better than we’ve seen in most of the recent decade, but still well in line with normal patterns (and still fewer than we had a dozen years ago). More short term rental listings are hitting the market (28 new listings in November vs 10 a year ago), and still mostly not selling. With 56 active listings, only 4 sold in November, indicating there remains a sizeable gap between seller expectations and market value. Compared to regular condos which at about 6 months of inventory are in balanced market territory, short term rentals at 14 months of inventory are solidly frozen. And though one sale doesn’t make a trend, the most recent sale of a short term rental condo was likely 20% below the pre-regulation value.
Total inventory started it’s normal seasonal decline, but it’s much later than normal which shows up in the seasonally adjusted figures continuing to climb in November. This was about the time that inventory growth started to stall out last year, so we’ll have to look closely at the data in December and January to see if we see a similar pattern (seasonally adjusted data is sometimes a little tricky when trends change).
Market balance however did not deteriorate in November from the month earlier. Here is where we have to be careful with seasonal adjustment and analyzing for trends. If we calculate the trend it continued to drop a little in November, but the raw seasonally adjusted value actually bounced back a little both for sales to new list ratio and months of inventory. This is a very tiny move upwards, but given the same thing happened this time last year and was followed by strengthening of the market in the spring, it’s one to watch.
The same is evident in seasonally adjusted months of inventory, which ticked down slightly after several months of rapid cooling.
Market conditions then are unchanged from last month. Though the sales to new list ratio is pointing at a buyers market, months of inventory remain at a balanced level. That means conditions on the ground are conducive to price drops (which we’re seeing), but relatively low levels of inventory compared to a decade ago make the balance still quite precarious. It doesn’t take a lot of additional sales to swing it back into price stability or increases as we saw in the spring. However with 25% more inventory on the market than a year ago, the balanced conditions are becoming more entrenched.
Prices were weak in November, erasing gains from the earlier fall and showing a bit of a decline from the summer peak. Detached median is up from a year ago while the condo median is down a bit, but realistically prices haven’t moved since then. Note the chart is 3 month averages.
Sales to assessed value ratios for detached properties showed some weakness last month. Though some of the move could be changes in sales mix (properties that need more work selling in the fall), that doesn’t likely explain a 7% drop in the median sales to assessed value ratio in one month. Part of it is sellers being more flexible with prices in the face of few and relatively unmotivated buyers. As happens nearly every year, the fall is generally a better time to negotiate on price than peak selling seasons.
The 5 year bond has fallen dramatically in the last month, though not all of that has been passed on in the form of lower fixed rates. With banks scrambling to increase their loan loss provisions and cutting costs, they won’t be too keen to pass on savings. In addition, while bond yields are down, they’re still half a percent higher than 12 months ago. Nevertheless, the recent drop has improved anticipated affordability (if fixed rates reflect the full drop), pushing it back to about the level we hit at the peak of the market in spring 2022.
I very rarely make recommendations to do anything in particular, but I do feel like now and the following months will be the time to pick up a house in the core if that’s what you’re looking for and you can afford it. That’s not because I believe prices will jump in the near future, but I also doubt we will see substantially better conditions for detached properties within a normal buying window. Yes affordability remains very poor, and I wouldn’t be at all surprised if prices in 3 years aren’t much different than they are today. Also we may be at the cusp of a recession which isn’t great for housing, but that’s likely to be counteracted with lower rates which combined with slowly increasing incomes will help affordability. At the same time resistance to price drops increases under the million mark as down payments drop due to the CMHC cap (even if current high rates make those mortgages difficult to carry). Meanwhile provincial land use changes add some demand from developers to the bottom of the market, supporting prices somewhat in the short term while in the long run detached properties become more rare relative to the housing stock as a whole. Maybe next fall brings the same or better buying opportunities, but don’t be surprised if the market firms up again first next spring. I don’t think there’s much reason for FOMO, but I suspect we’re in for a relatively boring market, leaning slightly more to upside rather than downside potential if we look beyond the immediate future. Note that in the last flat/down market, the core held up better than the westshore, and that’s likely to happen again, perhaps amplified as land use changes are more impactful for older properties on larger lots closer to town.
I don’t have the same recommendation for condos. While the same outcomes could come to pass in that market (prices roughly flat for years instead of dropping substantially), people often hold them for shorter periods, and renting may be a better option if you plan to upgrade in a few years. Supply is also fundamentally not limited, and all government efforts are focused on increasing the supply of multifamily housing which will help affordability in the medium to long run. If you’re in a stable rental that’s substantially below the cost to own, there’s probably little danger in waiting to see what happens.
We’re close to doing year end predictions so we’ll have more time to put in bets then, but if you’re in the market for a house, when do you think will be the best time to buy? Now, in 6 months, in 12, or more than a year away?
I’m an avid reader–thanks for the blog (and it’s been lovely to see the notice it’s been getting in the G & M). Question for you and your readers, if anyone would like to weigh in: I’m contemplating purchasing a 2-bed condo downtown and I love The Falls–several units have recently come on the market (too many?) but there are some building design issues that I worry about in terms of long-term maintenance. Any thoughts? Air conditioning/heat pump is an absolute must for me, so I’m a bit limited re options.
New post: https://househuntvictoria.ca/2023/12/11/summary-of-housing-policy-actions/
Can’t decide whether I want the covenants torn up so that everyone suffers or the covenants kept so I can dream of one day moving to one of these pockets of paradise.
Of course, houses in pockets of paradise would command even higher prices than otherwise.
I haven’t heard anything in particular, but given the province holds all land use power I very much doubt a covenant will hold up.
My assumption is that Eby hasn’t thought about restrictive covenants, but will gleefully tear them up as soon as they come to his attention.
Missing middle
Makes sense for Tesla to invest in Vancouver.
Will take a look.
https://driveteslacanada.ca/news/tesla-to-build-largest-purpose-built-service-center-in-north-america-in-vancouver-bc/
Thx. Do you see any signs of the lower end (tear downs) going higher than that, or are they also at 94% of assessment?
Still at 94% in December. I won’t update this until end of the month though.
Not everyone that has a SFH wants to sell…Most don’t.
I’m looking forward to Leo’s next article. In particular, an update to the sales:assessment. We have that at a sudden drop to 93% , amid anecdotes of boatloads of Vancouver buyers snapping up SFH for the lots.
Don’t think you need to look much further than James Bay to see that the few SFHs left are super valuable because:
a) they are rare
b) they themselves have future development potential
The capital gains exemption is good if you already own your forever house and your happy with life. For upstarts it doesn’t really help with affordability. For new people entering the market…They should be able to right off all interest, all insurance and all strata fees…Then pay the capital gains tax when they sell.
I wouldn’t get too fussed I’m sure in 10 years there will be little change , i don’t think these changes will do much if any for supply or prices . We have been here before and like Christmas this too will pass.
Yes, that’s multiplexes on a Zagreb street all right. The giveaway is the street crammed with street parking.
Definitely. My main concern is that in the 70s we put up a dam in most of our neighbourhoods and froze them in amber. Nothing changed for decades while the pressure to change continued to increase. Now we are breaking down the dam and the change could be faster than people are comfortable with. If we hadn’t frozen them, neighbourhoods would have changed gradually and organically over the decades and people would have barely noticed as single family was replaced with multiplexes and then small apartments.
What helps mitigate the pace of change now is that it’s happening everywhere at once, rates are high which slows investment, and we’re at/near the top of the housing cycle so likely in a lower activity period for a few years. But it’s still a step change.
Truer words were rarely said!
Hey man bring it on, I’m a people person. I was just saying from birth to 50 shit has changed bigly.
Think about what makes Victoria a great place to live.
The natural setting, the weather, outdoor opportunities, old town?
None of those are impaired by having more housing. In fact more housing in town means more walkable neighbourhoods and less pressure to cover the wilderness with sprawl.
Now what allows people to enjoy Victoria? Economic opportunity and housing availability. Both of those are enhanced via more housing.
Some people may be attached to the idea that Victoria is a small town, but that hasn’t been true in decades. Victoria has grown by about 1/3 since I’ve been here, and IMO it’s better than ever. No doubt others have different opinions and that’s fine.
That’s funny, from my POV it seems like it took forever, seems like many people (including me) from Vancouver had a decade or two to claim our little piece of paradise over here at a steep discount before it became sort of a no-brainer at large. I couldn’t believe it for years and years.
As to the current discussion, sure, personally I don’t like the concept of those 4 & 6-plexes in terms of the visual impact they make in a place like Fairfield. But that’s just the part of me that just wants the comfort of having everything stay the same – hey, at least I admit it! It’s nice, come on!! But in all seriousness, yes we are truly in a housing crisis and if we want to do more than pay lip-service to the issue, well then I’m glad gov’t is taking it seriously. Honestly, the provincial gov’t is very focused on it and doing not a bad job in a difficult situation, in my view.
For those who bemoan neighbourhoods like Fairfield changing over time with incoming 4 & 6-plexes, well the “problem” is that these neighbourhoods weren’t redeveloped fast enough into newer SFHs like in Vancouver. We came from West Van, where we lived in a little 1940’s cottage that reminds me of lots of those Fairfield homes. But most of those small old houses are gone in West Van, they’ve very much been redeveloped into $4 million+ single family mansions, so now it’s pretty much too late for a neighbourhood like that to be much affected by this legislation – quite different in Fairfield, late to the party, sorry!
One thing – there’s no realistic chance a single-family house in Fairfield 10 years from now won’t be worth substantially more than today, whether it’s next to one of these beasts or not.
Vancouver Island, not that long ago was a hidden little paradise. Well that changed fast, and its getting faster. Don’t get me wrong, I am totally pro development, I am no nimby. But wow, It doesn’t take long for word to get around.
Vancouver is just as expensive as Toronto. The move would be a net loss, likely in six figures considering all costs.
Now there may be some people for whom that wouldn’t matter, but there won’t be many of them.
When I came here, it was a toss up between Victoria and Vancouver. I could afford both. I liked the Victoria house better.
Lots of people are like that. The Toronto couple might like the golf course near a home for sale in Vancouver and move there. That’s normal life.
Not a chance. Remember they sold a $3M house in Toronto. They’re coming here regardless.
You could cheer yourself up by imagining the guy in the house is Leo… Living Large! 🙂
@ Whateveriwanttocallmyself, I don’t think those 68,000 want to defer their property taxes. If they had to pay they wouldn’t be able to afford to eat. They get their money in the end anyway, Its not like its a special gift…They will pay, plus interest.
I was just down in South Oak Bay by Beach Road. I walked by 50 old homes on 1.3 million dollar lots and wondered why are these old homes still there. The old house adds little to no value to the property and yet there they are. But then I saw some of those that live in them. Old age pensioners that are ageing in place. The same people that won’t be selling to developers of missing middle houses.
We have thousands and thousands of missing middle homes. They are not missing at all. The problem is that they are not coming up for sale in the numbers that they did 30 years ago.
Seems high when you can rent at Dockside a proper one bedroom for the same amount.
Don’t see them transacting at those prices.
Those Mermaid Wharf sales showing up on FB marketplaces as fully furnished long term rentals at $2,200.
current market says it is $350k for ~460sqft at mermaid wharf
An image of 33′ lots which don’t exist in Victoria?
I think by the time these new zoning changes effect my area the Wife and I will be 6′ under. It will be my 2 boys problem since they will inherit the house.
What exactly is affordable? Is a 400k 200sq/ft space in the Janion affordable enough?
i wish i had never seen this image.
this would be quite awful (for the house owner)
Big concern about the Quest was blasting. Quest approved, and literally weeks later there’s a community consultation about new strict blasting requirements and fees in Oak Bay as a whole. Make no mistake munis housing attitudes / policies still matter when it comes to these new rules.
I wonder if anyone is still angry at the Cook and Oliphant developers for “blocking the view of Sooke Hills”?**
**which by the way you can’t see from most of Fairfield unless you are on high ground or the Dallas Road waterfront
Thanks, didn’t think of that. There are so many homes in Oak Bay with alley access (like 80% Estevan and South Oak Bay) that if it ever did become feasible and profitable I can picture these lots being ideal for front back fourplexes.
It happens a lot that Marko inadvertently cheers me up!
The risk is too high….you drop off a permit two years from now and the Oak Bay engineering department says sorry X,Y,Z infrastructure can’t handle it, please resubmit when we upgrade infrastructure.
Everything we are talking about here is like 10 years out. You aren’t going to be seeing fourplex in Oak Bay anytime soon.
100% agree with you….I think you mis-understood the context of my argument which was these fourplexes (in Oak Bay) will not be filled with “sketchy” people that will devalue the neighboring SFH property, but they will be filled with high networth relatively quiet individuals that likely won’t be working on their Dodge HeliCat on the strata driveway.
As I’ve said before, the people buying the $2 million dollar condos in the new condo building being built on Oak Bay Ave are often moving out of SFHs which is a positive imo so even those $2 million dollar condos help the overall situation.
Maybe they don’t move to Victoria. They go up island or Okanagan. The more “perfect homes to retire in” we build, the more will come. If we build another senior-friendly big apartment on Cordova Bay Rd. or in Sidney, you don’t think that will attract more retirees “out of thin air” to move here?’ Same reasoning applies to a luxury Oak Bay multiplex unit – “Near the golf course!” – Which is how it will be marketed to Toronto and Albertans. I’ve got retiring Doctor friends from med school days that are looking for that exactly.
It would be wrong in my opinion to consider Victoria a closed system, where if we build 5 units, those 5 units don’t attract an additional person to move to Victoria. If you’ve got data that says differently post it. I know that in years when we complete few new builds, data shows that less people move here. Which is my point.
Blaming the arguments as being“tired” is perhaps a different problem. And you should get some sleep!
The answer to that is in my name 🙂
All these arguments are so tired. What do you think happens when you don’t build that missing middle townhouse? The toronto buyer evaporates into thin air? Nope, they just outcompete local buyers for the existing homes. The new owners of the house two down from me are a lovely family from Toronto. Guess what, the fact that we didn’t build significant missing middle didn’t deter them for an instant.
And yes, smaller spaces cost more per square foot than larger spaces in general. Newer places cost more than teardowns. Doesn’t change the fact that condos cost less than townhouses which cost less than houses.
Guess what, some of the cheapest land per square foot in the core is in the uplands, but that doesn’t do anyone any good if they don’t have $3M lying around.
Agreed.
Also, there are so few new SFHs in Oak Bay that almost nowhere is “safe”. Right now I’m not sure that it makes economic sense to fourplex an Oak Bay lot in most cases anyway given cost to buy a lot & high end construction. What are your thoughts on this?
sounds like you should send this to your kids
So what are your alternatives?
i/ Buy next to a SFH that has MM potential and live with uncertainty?
ii/ Buy next to a SFH home that has no MM potential (is newer and large). If you look at the existing six-plex massing versus new SFH massing (see Leo’s example below) there isn’t a huge difference.
Do I agree that you are “safe” buying in-between two brand new 4,000 sq/ft SFH builds in Oak Bay? Yes, I do. Do I think people will be flocking to pay a premium to be between two brand new 4,000 sq/ft builds in Oak Bay? No, I don’t think so. I think once a few of these high-end fourplexes are built (let’s keep in mind we are 10 years out here) people just won’t care as much as they think they will care right now.
Think of all the re-zoning meetings in the last 30 years and people just losing their shit in opposition….think Safe on Foods on Pandora. Since the Safe on Foods on Pandora has been built has literally one person been like this building ruined the neighborhood? Even thought prior to rezoning it was going to destroy the neighbourhood, cast a shadow on all of Victoria, etc. No people are happy that there is a Safe on Foods and a bunch of dog friendly rentals above it.
This SFH rezoning was a multi hour rezoning meeting of people losing their mind in opposition -> https://www.realtor.ca/real-estate/26211456/1346-kings-rd-victoria-oaklands
Has it impacted anyones life whatsoever since being completed?
Interesting chart, it’s something to see that the cohort with upcoming renewals in 2024 have already reduced spending in advance. Curious if the 2024 renewals’ spending reductions will meet the level of the 2023 reductions or if it will surpass it. Either way, the higher volume of renewals at higher rates should have quite the scale impact.
I’d expect a discount for a 1.8k SFH next to a fourplex that overlooks my back yard or home in South Oak Bay/Estevan vs. one next to a house that does not impinge on privacy like that – all other things being equal and assuming we are not in a super seller’s market.
Of course hard to tell because other things are not equal and it has been a seller’s market for a longish time.
Okay let me put it this way. I don’t think people will pay 100k more to be next to a SFH versus a high-end fourplex.
I don’t think this was the issue. I thought the question was does having a carriage house or fourplex next door impact resale value by up to 4.7% in upscale SFH areas as set out in the UBC study?
Possibly does in upscale SFH areas in Oak Bay and I would keep this in mind when making a buying decision. Might not in areas with significant % of house conversions/plexes/condos already.
Because they are new and sell for 50% higher on average than existing (used) product, Missing middle will be gentrified homes for out-of-towners.
Homes like this nice 2bdr 800sq ft for for $525k has always been available on the market, and affordable to most house hunters.
What the NEW missing middles add to this, is an UN-affordable version of the same thing, for $800k instead of $525k. (I’m using the sample prices @ $1,000/sq ft discussed by Marko yesterday and the Fairfield 1,700sq ft Fairfield townhouse for about $1,700).
That’s a big problem with the new missing middles. The NEW homes they’re supplying are about 50% higher than existing product for same size. And in a crisis of affordability, this doesn’t help affordabiiity and just means gentrification from out-of-towners
Marko supports this “gentrified homes for out-of-towners” this when he says
Marko:”A stereotypical buyer of a unit will be a retired couple from Toronto that sold their SFH in Toronto for $3 million.”
Excellent comparison to put things into context imo. As I said i don’t think people in SFHs will be fleeing South Oak Bay because there is a luxurious fourplex next to them. The impact on happiness will be zero.
And yet people pay millions of euros for a SFH to be in the middle of a multiplex shitshow.
We have to remove the bottleneck in our housing stock. Not enough middle income houses come up for sale. A house that once accommodated a family of five or six now has only one or two retirees living in them. I would start by eliminating the property tax deferral program. 68,000 properties in BC have their taxes deferred. That’s housing for 350,000 people.
The incessant fearmongering about MM is an odd way to demonstrate not caring.
It’s a mug’s game trying to control what happens on properties around you.
Could an MMI building eventually end up beside my SFH and slightly reduce the privacy of my backyard? Sure, but:
1) all three of my immediate neighbours can already see most of my backyard
2) if i was really important to me I could start planting trees and build an accessory building to screen more of the backyard from neighbours
3) If it was really, really important to me I shouldn’t be living in a dense neighbourhood of SFH in the first place and should instead be thinking rural or semi-rural areas that are still close to Victoria.
If one of my lovely neighbours moved away and the new neighbour was someone unpleasant or annoying that would have a much more immediate impact on my happiness than a hypothetical MMI development.
FWIW we already have an MMI equivalent on our Fairfield street. Boxy 4 unit, 3.5 story thing that started as a heritage conversion years ago but doesn’t have much heritage left on the outside (nice inside). Not terribly beautiful. No discernible impact on my happiness or even their immediate neighbours who recently spent a bundle rebuilding (and could have easily moved away if the 4-plex was an issue). I know 2 of the families there – great people
Does Uplands being declared a national historic site by the feds a few years back limit what can be done there? Or was that just standard symbolism over substance move that has no real impact?
I would say “no” it would not limit what can be done there.
The historic site designation has not stopped the demolition of many near heritage homes in favour of modern monstrosities (which undermines the heritage argument and designation BTW). That hideous new home on Midland even has many multiple kitchens so technically already is multi-family and that was allowed. I recall even back in the 2000s looking at a house here with an additional “pool house” that had full kitchen with three bedrooms so really a laneway house. Given the large size of the homes and the lots, I don’t think that allowing four units will impact much on the character of the place.
Not sure if I would trust Marxist Markos personalized “facts” , bear in mind he is a developer. By the way I was in Croatia and in Zagreb and most of the place is a total shitshow for housing which is not surprising since it was run by communists for decades. Probably explains the number of young people leaving.
I strongly suspect that a lot of the MM is going to be financed by cheap government loans but with the caveat that it is for rental housing. That will change exactly how luxury these units will need to be and still remain profitable. I notice the conversation somehow shifted from six plexes in Fairfield, where we were told the Vancouver buyers are picking up property to four plexs, all luxury, in Oak Bay.
Just so many factors at work here. The sales/assessement won’t really work because too few sales and if there’s a value impact it may already be factored into the assessment (not sure the full list of factors they consider in their model)
In general unless there’s a massive impact it’s going to disappear in the noise. One place is next to a sixplex, but the other has a green kitchen, which is worth less?
Or below, in which case did the neighbouring property lose more value?
It’s pretty simple. You don’t see Happy Valley single family homes being built in Oak Bay and you won’t see Happy Valley style fourplexes being built in Oak Bay either. It will only work if each unit is over $1.5 million with a parking spot. The only way each unit won’t have parking is a maximum amount of parking bylaw is introduced. The market left to its on devices will 100% have parking with each unit.
I show units in these missing middle properties on a regular basis….just look at realtor.ca, it isn’t like they are rare. As I said enough have been built where if Leo had time he could analyze adjacent property sales.
Here is an example of one for sale in Fernwood -> https://www.realtor.ca/real-estate/26302641/3-1409-camosun-st-victoria-fernwood
That had even me LMAO! 🙂
I can’t argue with your experience Marko, just not sure it plays out like that in Uplands/Estevan Village/South Oak Bay – at least until there are a lot more fourplexes in the area.
I doubt fourplexes would have any negative impact on the high value areas in Oak Bay. If fourplexes being built in these areas, the cost would be a lot higher than $500/sq ft, because it doesn’t make sense to build low cost and low quality when paying over $1.5mil on 8000 sq ft+ clean lot.
and that rarity will lead buyers to live with “compromises” like living next to a luxury fourplex.
Been waiting for someone to bring this up. CoV had a missing middle policy for years that they called “house conversions”. Not sure how successful it was, but there seem to be several examples scattered around Fairfield, and quite likely near Count Barrister’s castle. Did property values decrease as a result?
I doubt Leo has the time, but there are enough existing sixplexes in Fairfield/James Bay/Rockland on residential streets where Leo could provide us with some sort of sale price vs assessment (or something) analysis, and it would show zero or negligible impact on value just based on my feet on the ground experience.
Agreed because of redevelopment potential and scarcity over time.
Still there will be downward pressure on neighbouring properties next to fourplexes right now imo so I’m going to give that factor some weight as well as my privacy when buying.
At some point if there are 60-80% fourplexes in Oak Bay the house next door may be worth more as SFH because of scarcity and prestige and the density factor becomes moot.
What about all the MM that has been built so far? This is a sixplex in Fairfield (one unit is currently for sale on mls) -> https://maps.app.goo.gl/rpgKmAgJNgkrbWKk6
I haven’t seen a reduction in value in adjacent properties nor have I had buyers specifcally avoid SFH next to these multiplexes in Fairfield/James Bay/Rockland.
What will be so different with new MM compared to these existing MM?
The whole concept of a single family house within walking distance of city amenities is an extreme oddity in most cities around the world. The only reason it’s commonplace here is because of zoning. A single family house in the city will be super valuable in the future just by it’s rarity so those owners have nothing to worry about.
Does Uplands being declared a national historic site by the feds a few years back limit what can be done there? Or was that just standard symbolism over substance move that has no real impact?
Good luck to the kids Patrick!
Patrick I was kinda hoping u would lead the charge against the up zoning . Not because I’m against it but I’m a big fan of opposition and this one needs to be slayed lol
I haven’t spent much time in China, but I’ve been to Taiwan on several occassions….and what SFH communities? lol.
Once again, take a look at this luxury home -> https://maps.app.goo.gl/KxAEsUEiddzKh5x48
It is on a street made up of multiplexes (spin around on google). This luxury home was recently purchased by a Croatian soccer player for an amount that far exceeds the cost of buying every single unit in any multiplex on the street. In my estimation the home was also 2x what the same home would cost in a SFH community 15 minutes away via car. At 3 million Euros would the soccer star rather be on a street with other villas, instead of surrounded by multiplexes? Of course he would, but the problem is such doesn’t exist in a prime location and he and his family decided they rather be in a prime location surrounded by mutiplexes than 15 min further away.
A day is going to come in 20 to 30 years where if you want to live in South Fairfield or South Oak Bay sixplexes and fourplexes are the new reality and I doubt people will be moving to bare land stratas/acreages in Sooke/Duncan, Calgary, etc.
Does this three story luxury fourplex with professional routine gardening bother me so much that I will vacate South Oak Bay for an acerage in Duncan.
Pretty confident in this.
The one factor that is specific to MM is it will lead to scarcity of SFHs; therefore, in my opinion SFHs will appreciate at a faster pace over the next 10-20-30 years than condos/townhomes and some of that will be attributed to MM.
In Edmonton, neighbourhoods have (so far successfully) fought against the in-fill/upzoning/density bylaws coming to their neighbourhoods. They do this by going door-to-door, and signing up whoever agrees to add a covenant to their property preventing upzoning. This can be just a few properties or most of the street. https://www.cbc.ca/news/canada/edmonton/property-covenants-new-weapon-in-door-to-door-battle-over-infill-housing-1.3597594
“ “When my family was looking to move into the neighbourhood, the character of the neighbourhood was a big part of that — the mature trees, wider lots, low density, good schools — and that’s really what attracted me and a lot people to that neighbourhood. And I think that’s the biggest concern.”
Darren Jacknisky, who lives in Westbrook, is one of those going door to door to try to get people to sign covenants. He said he got involved because lot splitting can change the character of a community.”
—————-==
So Introvert, how about it? Are you up for going door-to-door like Darren Jacknisky, and signing up the neighbour-owners in your cul-de-sac to sign covenants restricting density?
I don’t care that much but 4.7% of 1.8 million is almost 100k of tax free equity. People will care, they just won’t be able to stop the redevelopment next door anymore.
Re: covenants protecting against density coming to your neighbourhoods
Here’s a legal analysis from an Alberta law firm that says the covenants against density are likely enforceable (stopping density). Because the government laws aren’t that you must have a multi-plex, it is just that you can have one. And the whole idea of covenants is to prevent you from doing things that you “can” do, if you agree not to do it. They can only break covenants when the covenants stop you doing something that the government says you “must” do (install a septic system for example).
https://www.fieldlaw.com/News-Views-Events/150410/Use-of-Restrictive-Covenants-in-Residential-Developments
“Restrictive covenants dovetail conventional land use bylaws by further limiting land use possibilities. The legal controversies pitting restrictive covenants against zoning bylaws are arising when covenants are challenged by property owners or developers seeking to introduce land uses that are permitted by zoning regulations but prohibited by restrictive covenants. In such situations, courts will generally rule in favour of restrictive covenants. This is because stricter obligations placed on an area by restrictive covenants do not contravene zoning regulations, since zoning prohibits and regulates but does not prescribe.
Restrictive covenants, once attached to a Land Title, provide little leniency. We have seen that whereas in the past restrictive covenants converged with zoning to protect certain land uses from the negative externalities of other activities, such covenants may well foil emerging planning objectives. As the number of developments they burden increases, restrictive covenants make it increasingly more difficult to reach planning goals. For cities like Edmonton and Calgary that are changing and evolving, this is shaping up to be a growing issue moving forward.”
I would tend to agree that given the choice, a single family buyer will prefer a house next to a smaller SFH than a house next to a 6plex that is physically larger. All things equal, probably this positive preference translates to a couple percent higher price for a house not next to a multiplex?
But:
Don’t know what to say to this except maybe the siting was done well ie. these units are all facing the roadway or on corner lots with low impact on neighbour’s privacy, the market has been a super buyer’s market for a long time suppressing this effect, or maybe the study is flawed – not sure. I just know that the study aligns with my views.
Not sure what you are saying here. All properties will appreciate but a 4-plex in a high value area will be one factor that may be a negative. Of course other factors are at play ie. buyer’s market or not, condition of home, site specific privacy, location….
Good overview of single stair reforms and why our apartments look the way they do (BC has promised to review allowing single stair) https://www.youtube.com/watch?v=iRdwXQb7CfM
Funny I have been to many “attractive cities” around the world also, typically SFH in a community of mainly SFH’s is more sought after than SFH in a mixed community. This is especially true in China and India.
LMAO, what makes you think they are bulletproof?
Yes, but people with money who want a SFH are going to look for places not next to plexes or carriage houses first. They’ll buy next to them for a discount to get into a certain area, but wealthier buyers will pay more to avoid this.
I know I would. My criteria now would be to look for a high value house on either side or a big corner lot with high value homes next door. You cannot control the future but you can reduce the chances of redevelopment next to you by doing this. If the place next door is going to be redeveloped maybe you know the neighbours and sell before this happens.
I think this is absolutely true re. what the study found and remains true:
“We tend to understand our backyards as being private spaces because our neighbours can’t look into them very effectively,” says Dr. Somerville. “So, when the second floor of the neighbour’s laneway is looking straight into the back of my house and into my backyard, that’s where we find the negative effects. That’s what we’re really picking up.”
Abstract and Aryze have built plenty of three stories townhomes and condos in premium areas and I haven’t seen a drop in adjacent SFHs.
So if the market goes up 100% in the next 20 years, but the impact of the multiplex is a negative 4.7% the market isn’t relevant?
But the laneway house prevents the fourplex (the laneway property is worth too much to be torn down).
Doubt it. I’d think a laneway house would still be negative in an upscale area and a fourplex even more so. Reason being is that people don’t like to have anyone overlooking their yard and prefer lower density next to them re. parking and potential for other nuisance stuff. Given the choice between a house next to a fourplex and a house between two renovated houses they are going to choose the latter.
What has changed is that the right to build a fourplex exists almost everywhere so maybe over time this factor gets eroded. Or maybe it is not as much of a factor. I don’t remember what the past discussion of this study lead to, but seems to have some valid data.
I suspect that there is strong possibility that the court would hold the Upland covenants as unenforceable as against the new public policy set out in the current legislation. Impossible to predict a judicial decision but I would not rely on the covenants.
I would also worry that bear land strata lots would fall under the intent of the legislation. May need a test case.
Good policy or bad policy is not relevant here. The law has been passed and I doubt there will be major changes. Ma4rko might be right if there is only three of four SFH homes left in Fairfield and they are all newly built luxury homes then in about a hundred years the prices will go up.
The real question is whether one of your children should be buying a house, TODAY, in somewhere like Fairfield. The value will decrease if a three story apartment is built besides them. What happens to the general market is not relevant as to what happens to your kids single purchase.
I think this is great for the developers but is going to be bad for the city overall. Contrary to what Marko says I believe in development but it should be good development. But I dont care personally. Our kids and grandkids all have homes and not in Victoria.
We already discussed this study on HHV.
Wouldn’t this study now be completely upside down? You would think that now you would WANT to be next to a house with a garden suite as it reduces the chances of a multiplex significantly?
Same applies to the future. Let’s say in 10 years the fourplex legislation is deemed a success and the province expands it to eightplex now having a fourplex next door is looking positive.
Lots of neighbourhoods (Ten Mile, Broadmead, parts of Uplands) have “covenants” limiting things like subdivisions and additional dwellings. So no missing middle coming to Broadmead!
My assumption is that those are bullet-proof to these new “density” proclamations from governments. I would expect that zealots in the government would love to pierce them if they could . Anyone hear of plans to do that?
According to this study it will likely drop a neighbour’s home value by up to 4.7% in Oak Bay. However, I would trust your boots on the ground judgement on this.
https://news.ubc.ca/2021/11/18/laneway-homes-decreases-neighbouring-property-values-affluent-areas-ubc-study/
Context is really important here. A fourplex in Oak Bay will be $1.5 to $2 million per unit for the developer to make the numbers work, otherwise it won’t be built. To be able to obtain that kind of sale price the quality of construction will have to be high and every unit will have a parking spot. A stereotypical buyer of a unit will be a retired couple from Toronto that sold their SFH in Toronto for $3 million.
If your SFH house next door is not a teardown and the market value is $1.7 million doubt demand will drop that much as a result of a luxuries fourplex next door with sketchy retired professionals living there. Odds are that kind of strata will have a professional gardening company, etc.
As I’m trying to sort through the math of these changes, it seems like the lots that will be developed first are those on larger lots with lower value structures (ie. older housing stock). A developer is not going to pay for a newer or recently renovated house they are going to tear down when they can pay less for an older one and these types of homes will have significant competition from buyers looking to live in a SFH.
If cost to construct is 400/square foot, the developer pays 1.1 for the lot, pays to deconstruct and remove the exiting home, and needs to show 20% profit to get financing and then is paying commercial interest rate on this financing, the number I get to for a 1500 square foot townhouse is well over a million. Even with an older lower-value home, I’m not sure the profit is there to engage in widespread redevelopment right now given interest rates, sales volumes, and demand for what will be a relatively expensive smaller multi unit vs. available alternatives.
I can, however, see why developers with deep pockets are buying big lots right now. They can rent these houses out and wait for better times, or just wait upswing in the market to resell as a hedge should the decide not to proceed.
In terms of impact on adjacent SFH values, the research seems to support that:
I guess what this means is if you own a crappy house on a bigger lot you should get a bit of windfall. If you own a fantastic renovated dream house on a bigger lot you probably won’t have as much of an increase from these changes, although demand for your home may increase over time due to increased scarcity.
I’m not too worried about having townhouses next door myself. And overall I’m way more concerned about getting more purpose built rentals, especially through coops. We have so many people now who will never be able to afford to buy a family-friendly home that there needs to be alternatives with government support.
===
3 “kids”, all in their 20’s.
– one, in Vancouver, has “high” income and is looking in Vancouver & Victoria, and can afford both
– one, in Victoria, has “median” income, looking in Greater Victoria, and might need creative financing solutions
– One , in Vancouver, is still at uni . So renting.
All of them find the house prices and rents (in Van and Vic) to be absurdly high.
My role is mainly advice, in small doses at the appropriate times 🙂
And maybe help out when the time comes.
I find HHV very helpful all around, to help with all the scenarios above. I enjoy the articles, and the comments section.
Why are they looking in Victoria? They were born here, and I think (hope) that home-grown Victorians tend to return – like the salmon in Goldstream!
Leo, curious to hear your thoughts. Do you think missing middle will negatively impact value or SFHs?
The SFH market as a whole will see greater appreciation.
Not from what I’ve seen in attractive cities around the world. Not everyone will want to live on Bear Mountain in a bare land strata gated community and those that will want to live in town in a SFH will have no other options. Your best option will be to buy a newer house sandwiched between other newer houses and live in uncertainty or just buy inbetween two 6plexes (4plexes outside of COV) where you can already see that they aren’t blocking any sun into your backyard, etc.
So this listing of mine is not only on a bare land strata street but also all luxury homes with no suites (no parking issues and never will be as private road). Zero chance in my lifetime a MM is built on this street, will it see greater appreciation? Doubt it because it won’t be as scarce as a new SFH in South Fairfield.
https://www.realtor.ca/real-estate/26055383/4113-alberg-lane-saanich-mt-doug
Likely those SFH would be worth less than if the street wasn’t full of MM.
POS SFH surrounded by 4/6 plexes versus a newer townhome, toss up I’d say.
Yes so the SFHs that aren’t likely to be surrounded by MM housing will likely see greater appreciation.
If you are really fearful of MM just buy a SFH on a bare land strata and plenty of those around.
Would he prefer a townhome or a SFH surrounded by 4/6 plexes?
The overall SFHs stock shrinks as MM is built further making SFHs more unaffordable. Leo has talked about this to no end in the last 10 years.
So if you have a block of 40 houses in South Fairfield and 38 are converted to MM and two owners opt to build luxury SFHs you think they are SOL? From what I’ve seen in my travels around the world these types of places go for an insane amount based on scarcity.
Where you going to move to? An acreage in Sooke or Duncan? Or Calgary? Sure some people will but most will opt to take an extra 30 seconds to park on their driveway versus commute three hours a day to Duncan.
Secondly, do you think those brand new townhomes on Washington Street have negatively impacted property value on the street? It went from poorly maintained houses to brand new three story townhomes with young professionals living there.
Take a look at google maps before and the finished product. I personally would be much more comfortable buying a SFH on Washington post new development.
If the house is a POS then likely it will benefit from the new 4/6 plexes around (700k before might be 850k after), if it is newerish/renovated then it will likely be a detriment (1.4M before might be 1.1M after).
I think what he is saying that if there’s a bunch of 4plexes built around a SFH then that particular SFH would drop in value as a SFH. So if you built a brand new SFH and then all of a sudden all your neighbors become 4plexes then you are SOL. So if you want to enjoy the SFH lifestyle then you need to buy in a neighborhood/street where the likelihood of this happening is lower.
I think Zach would prefer to have a SFH that is not surrounded by 4/6 plexes if he had the choice, he just needs more money to have that choice.
And you living in a 6,000 sq/ft mansion with 10 years of anti-development comments on HHV is more objective? lol
Let’s say you were correct, which you aren’t for reasons I’ve outlined in the last week on HHV, it would be exactly what MM aims to do which is improve affordability.
What you are saying is if a bunch of MM units are built price of SFHs will drop……how is this bad big picture, it isn’t? This is exactly what we need is more affordability in a housing crisis.
Maybe let’s ask Zach if he would be upset if a bunch of MM was built which also resulted in lower SFHs prices?
That being said it won’t happen as SFHs will become more scarce.
Marko, you are a developer and your opinion on this is less than objective. I really do hope that you are not telling your real estate clients that having a three or three and a half story apartment block besides them has no impact on the value of their single family home.
Thank you Leo. That is helpful. It is a square lot, so even with setbacks and lot courage should get pretty close to it.
100% not correct, but sure believe whatever fits your narrative of MM ruining Victoria.
Max, at least for Missing Middle, the developers dont have to be at all generous since every lot has been rezoned. If you are in an area were a number of MM are been constructed it is likely that your SFH will go down in value. You are going to lose a lot of potential buyers who dont want to live in the CofV version of Happy Valley. Once you start to lose the high value buyers, the handful of developers will be low balling the houses.
The policy is here: https://www.victoria.ca/media/file/schedule-ppdf
Max FSR is 1.1 but of course you’re not going to get there on most lots due to other restrictions (setbacks, lot coverage, etc)
Leo, what is the FSR in the City of Vic for the missing middle for a 27,000 sq ft. corner lot?
Month to date activity:
Sales: 128 (up 2% vs same time last year)
New lists: 183 (down 1%)
Inventory: 2453 (up 24%)
It pulls the photo using your email via gravatar. Feel free to put in a fake email, it doesn’t matter what you put in that field. I’ve done that for you on this thread.
When you see it coming hop on board. I know a guy on Peat Road in Langford surrounded by towers, one of them being the Danbrook 1. Another guy I know just up the road…again surrounded by towers. Its hilarious to look at, a tiny little house surrounded by towers . It happens, If you don’t take what they offer (which is pretty generous) they will build all around you.
Patrick Maybe your kids should consider buying in Calgary? If they buy a SFH in Victoria and a bit later they build a six plex next door or worse still on either side, exactly what happens to the value of their home. While the development pimps call them townhouses they are not what most people think of as a townhouse. They are a thirty six foot box with six or possibility twelve apartments in them. I would not advise anyone, much less my children to take a risk like that if there is the slightest possibility of a MM being built next door or a bunch of them on the same street. This is your kids single biggest investment and if the property value takes a hit then it will take years for them to recouver.
Its the bottom of the cycle.
(Also, how do I get my comments to not show my photo?)
I’m curious about these kids of yours, Patrick.
What are their ages / incomes / current living situations? Why are they all looking for SFH in Victoria right now?
There are literally hundreds of townhouses and (real) SFH for sale in the CRD at the moment, the vast majority of which have their own garage.
Leo has suggested in recent posts that the next few months could be the best opportunity to buy that we’ve seen in the last few years (I hope he’s right), and that we might see for years to come.
What is the FSR, in Victoria for missing middle on a corner lot?.
Thurston, I am saying 27,000 sq. ft Lot. About165 x 160 foot frontage and a bit irregular on the other sides.
I think every man should at least be able to frame a house, I also think every man should be able to do their own brakes on their own vehicle. I sometimes feel sorry for my Son heading off to work in the pissing rain, but at the same time…I don’t.
Barrister are u saying 27 ft frontage or 27000 sq ft
Look up wall street bets game stop…kids made millions. Its a different time.
I dont have clarity on all the details. Marko, or someone who understands the details, what exactly can you build on a twenty seven thousand square foot lot, that is on a corner, in the city of Victoria? What would a developer pay for this type of lot in a premium part of the city.
?
I have been using these:
https://www.bioflame.ca/index.html
2 pallets delivered into my garage will heat my entire 2600 sq/ft house for a year.
Renewable energy, recycled waste…2 pallets delivered, GST in…no carbon tax $800.
No spiders, dry consistent burn, no mess, no stacking, no splitting…all on pallet good to go.
My gas meter has been slugged for over a decade. That means they come and put a slug in the meter in the off position so I can’t use gas. I have told them over and over to remove the meter off my house. I don’t like gas in my house and I don’t like carbon tax. I burn wood which is carbon neutral and tax free. I don’t think I could do that with a strata committee.
Yuk. $ 1.1 million is current price of a median SFH. So the same level of unaffordability as Leo’s famous (un)-affordability chart.
We will see if the HHV crowd who can’t afford a median SFH get excited about a strata “unit” with the same $1.1m sticker price.
Caveat agree I bought a flat in a Fairfield conversion, 3 large units it was a bit painful having only 3 people at the table it was the reason I sold it
+1, that is why personally I prefer to live in large condo developments. If you want to be involved you can be and if not no need to be.
+2, complete non-sense imo. There is a reason why a newer two-bedroom condo in Fairfield sells for an equivalent amount to a starter two-bedroom home in Fairfield. The market dictates the price. Is the starter two-bedroom home with dirt a much better investment over 20-30-40 years? Of course it is….but there is a reason why buyers pay the same price for a “liability” condo. Believe it or not, some people actually like living in condos; therefore, creating demand at $1,000 per sq/ft. If there was no demand prices would plunge.
I call none-sense on that. For sure there are pluses and minuses to condos. Just like there are for SFHs.
But if you are that person that doesn’t play well with others then definitely avoid a small strata development. You can’t be that hands off really if the strata is only a handful of units.
Once again, typically there was no maximum # of unit restriction; therefore, if you can build 1,000 sq/ft you are better off building two 500 sq/ft one bedroom units versus one 1,000 sq/ft unit. However, if there is a maximum restriction at one unit you will build the 1,000 sq/ft unit. You aren’t going to build one 500 sq/ft unit.
Of course there is a market for two bedroom and three bedroom units, but it isn’t as high per square foot as one bedroom units so developers build one bedroom units if they can. With missing middle they can, but it won’t make sense.
It is easier to sell three 1-bedrooms at $500k than one 3-bedroom at $1.5 million so developers build mostly 1-bedrooms when there is no max unit count restriction.
However, when you are maxed out at four or six are you better of building six 1-bedrooms at 500k, or six 3-bedrooms at $1.1 million even thought the per square sale price is much lower in terms of the sale price? Both teardowns at $1 million and one gross is $3 million and the other gross is $6.6 million. Everyone is going to go biggest units first (largest lots) and it will be some time before we make our way down to missing middle projects with primarily one beds. This only applies to the COV…..for the provincal missing middle I can’t see many fourplex 1-bedroom developments being economically viable.
Marko hear u on lot size . Not sure why they wouldn’t have scaled the number of units more specific to the size of a lot like u would do for a rezoning .
Marko in your experience has there been less demand for anything more than a 1 bedroom . The reason I ask is u yourself only buy 1 bedroom condos as most investors and I get the impression that in the past there was nothing stopping developers from building bigger units other than maybe the market isn’t there for them
Max, as you are thinking about helping your son and his significant other, how about I float an idea to you.
How about a two-bedroom condominium with an attached suite under one legal title. In that way they can live in the one-bedroom and rent the two-bedroom as a mortgage helper. When their relationship progresses and a little Max appears they can then move in to the two-bedroom suite and rent the one-bedroom. When little Max becomes older then little Max can live in the one-bedroom. Eventually little Max will venture out on his own and your son and significant other may use both suites as a three bedroom or turn them both into rentals.
My opinion is that this is another way to address the missing middle by having a condominium that is flexible for a growing family allowing them to stay in the same home over a longer period of time and not have to leave the city to find a house in the Westshore.
The problem with building a three-bedroom condo is that they are large units. And large units are expensive. A flexible suite option allows the buyer to reduce their monthly expenses by renting out either of the units.
So what do you think Max, would this be a viable option for someone like yourself to help a family member get into the housing market?
There is a mute button for a reason, go use it
Hearing “insider contacts” is my least favourite part of this forum. Pains me to read it so frequently.
There won’t be a focus on 1-bedrooms due to limit on the number of units. This isn’t a building where you a constrainted by height and FSR and you can do 50 two-bedrooms, or 100 one-bedrooms. When you are constraint by the number of units you will be build the largest units possible to max out the FSR, for the most part.
The reason the bigger lots in the COV are selling right now and the smaller lots (5,500-6,000) are not selling is on a bigger lot you can do 6 two or three bed units. On a smaller lot you run out of FSR and have to do one bedroom units.
Another way of looking at it is you have to pay a million for the teardown. Does it make more sense to build six 1-bedrooms or six 3-bedrooms?
LMAO, you should worry less about my insider contacts and more about someone building a 6 plex beside your house ;). Maybe fix that rotting fence in the backyard too?
He still declares income from his framing job on his tax returns, doesn’t he?
We know. It’s in Gordon Head.
Hey, I think your “insider contacts” are telling you to stop pathetically lying on an anonymous internet forum.
Even with the change in zoning I’m guessing the majority of new units will still be 1 bedroom as that’s what investors want to buy. Really more of the same only difference is u can now build them anywhere.
They use these things:
https://www.safepal.com/en/
If they want money they just transfer it to their phone.
Max, when it comes to bitcoin, I think Pierre Poilievre does the same.
No one can access your digital wallet…divorce, taxman, etc.
@ Introvert.
Its the new future.
There is a host of options to help a struggling homeowner in the case of an economic down turn. Mortgage deferrals, line of credits. It will be the rental market that takes it all down when the tenants just simply can’t pay the rent. People that rely on that rent…well you know how that works.
Why would I want to disclose that? I will say it isn’t the westshore
Dear god.
LMAO, why don’t you ask that “airbnb4me”poster how my insider contact info played out?
Agreed Max.
I think condo’s are a liability rather than an asset moving forward. Its in the dirt, always has been. Add the super high strata fees, insurance, minuets. No thanks.
The NIMBYs are right. That’s why I can correctly estimate the value of a condominium in a neighborhood that doesn’t have any condominiums at all. Market Value relies on the substitution effect relative to the alternatives available to a prospective purchaser in that neighborhood that have a similar utility.
Let’s look at the Cook Street neighborhood. A starter house is the alternative to a new condominium with similar utility. A prospective purchaser is trading off the age/condition difference of the improvements for two properties that have similar utility and location. Therefore, a starter home that has been well maintained and not needing any immediate repairs will sell in the range of a new condominium of similar utility.
401 1014 Park Boulevard at $1,187,000
While a starter home in the same hood at 270 Moss sold at $1,315,000
They aren’t exactly the same utility but one can adjust upwards and downwards for the differences.
“I think it is extremely important to know what the 24 to 35 year age group is doing. Being spenders they are the economic engine that drives our economy”.
My son is 18 who still lives at home ,is a house framer making decent money and puts all his money into bitcoin. His whole crew does, all his friends do too. They have this device that looks like a circuit board connected to a keypad connected to satellite as their digital wallet.
I find it quite sad that you feel the need to change identities, and then lie about, on an anonymous internet forum.
Oh and your “insider contacts” goofballery is of the utmost value, LOL
You won’t say where your investment property is.
We know Ks112’s was in Gordon Head.
You claim you’re not Ks112.
Pretty sus!
Well with a 20% drop, median SFH is $888k (meaning half are LESS than that!), and that’s more like it for many HHVers who aren’t really looking for “units”, be they new or used.
I think the idea that “my home is my castle” still applies in every generation, and the desire for the SFH being “the castle” is as strong as ever,
Irrelevant of what the market does missing middle is of benefit in my opinion. Let’s say the market drops 20% across the board….$900k condo, $1.25 million townhome still a lot better than the $2.4 million SFH.
Whether you hold off or not, missing middle will help.
And there we have it. A new townhome in a nice location is $1,000/ square foot. ($1.675m / 1,700 sq ft = $985/sq ft rounded up to $1,000 with closing costs.
https://www.realtor.ca/real-estate/26227123/116-1720-fairfield-rd-victoria-fairfield-east
So someone wanting a 1,900 sq foot unit would be looking at $1.9m if it was in a nice location (like Fairfield)
These are using current prices, as reported by in Marko’s post . That’s almost double the $1m the poster from earlier today expects to pay
This isn’t good news for anyone. Just reporting what the numbers are, and adding some realistic expectations as to what missing middle will and won’t deliver.
I think you’re right Max, the renters will feel the recession first. But if the last recessions are any indicator then you will have renters bugging out in the middle of the night leaving the rental vacant and the landlord a couple of grand short on the mortgage payment.
Greater Victoria is not a large housing market. We may think we’re bigger but Surrey alone is larger than our real estate market. If a recession were to happen then a lot of the 24 to 35 year olds will be loading up their trucks and heading to Alberta as they did in the 1980’s. They tend also to be renters. The vacancy rate could double quickly as I suspect it has already done in the downtown core. A landlord may now find that it will take a couple of months to lease up the same space they filled before in a couple of days and likely at a lower rental rate. That may put landlords a couple of months behind in their loan payments. That’s an immediate impact happening across a large section of the housing market. Unlike mortgage renewals that can be planned for a year or two in advance.
Not going to say it will happen. Lots of things can happen. But the misconception about the 1980’s housing crash was the interest rate was the cause. It was the vacancy rate that caused the crash. Investors that had multiple units found their suites vacant and they fell way behind in their loan payments and it was foreclosures that set market values. That’s probably very unlikely to happen due to our high immigration.
I think it is extremely important to know what the 24 to 35 year age group is doing. Being spenders they are the economic engine that drives our economy.
I second Marko’s take on construction cost. We’re preparing to break ground on a 8plex in one of the a less desirable areas. 4 large 3beds, 3 x 2beds and 1x 1bed. The total cost (soft, hard, financing etc.) excl. land is close to $460 per sq.ft.
The often complex structures, electrical distribution, municipal requirements, and in the current environment: financing costs contribute to the these high costs.
I do expect the standard houseplex designs to dial the construction cost in somewhat closer to $400/sq.ft.
Thanks for weighing in, Marko.
Safe to say, I’m holding off from buying the 15 year old unit next door currently priced at over $1 million, and the $2 million+ SFH homes I see right now in Fairfield, despite Patrick’s assurances that the status quo is my best bet.
$300 per sq/ft is not exactly an easy pill to swallow. each unit has a legal suite to rent to subsidize the mortgage. When you decide to sell, how does this effect your capital gains exemption?
Multi-plex is going to be a lot more than $300 per sq.ft. The higher the density the greater the cost. For example, a downtown concrete tower is going to be well north of $600 per sq.ft construction costs. That is why you don’t see developers starting projects even with condos selling close to a $1,000 a foot in certain buildings.
My best guess would be $400 per foot for a simple fourplex of townhomes. That is 750k construction cost per townhome or $3 million plus $1 for the teardown lot.
In a less desirable location the finished product will fetch a million -> https://www.realtor.ca/real-estate/26300864/2-3080-washington-ave-victoria-burnside
In a prime location they will fetch >1.5 million -> https://www.realtor.ca/real-estate/26227123/116-1720-fairfield-rd-victoria-fairfield-east
So the gross could be anywhere from $4 million to $6 million. That is why all the missing middle properties selling right now are in more desirable locations. You only pay 200k more for the lot; however, you increase your potential gross by a substantial amount.
The problem with NIMBYS is they keep comparing the finished product price to the teardown price which is just idiotic imo. You have to compare the finished BRAND NEW product to a BRAND NEW SFH. A three bedroom $1.1 million condo in a six-plex or a $1.5 million townhome in a fourplex is a lot better than a $3 million dollar brand new SFH.
and as Leo has pointed out many times. What is a brand new townhome going to be in 25 years? A 25 year old townhome that will be a lot cheaper than a 2048 build townhome.
Zach, $300 a square foot on average is not that far off from what I use in my calculations. Oak Bay is higher. Langford is lower.
But you are not building a house. You’re building a house-plex. More kitchens, more bathrooms, more interior wall partitions, more costs to strata title, etc.
And I don’t find much economy of scale building four or six units. You have to build 20 plus units before suppliers will give good discounts. You won’t get much of a deal on four stoves. On 20 or more the suppliers are willing. Kitchens and bathrooms, etc. can add another $100,000 a suite to those costs.
There is also a difference between gross building area and the livable area of a suite. There is about a 15% difference depending on the design. You want four – one thousand square feet suites then the gross building area will be larger at say 4,600 square feet
Now how good are you at managing a project like this? There are going to be delays getting the trades. We don’t have experience home builders to build house-plexes, neither are there the trades. There is going to be a learning curve. It’s not like turning on a faucet.
The hope is that in the long term building costs will come down. But in the short term they will likely spike.
Fair enough. I hope it works out that way too. I think at this stage , about everyone wants to see lower prices. In any event, I appreciate the thoughtful reply, and thanks for the discussion.
There is a mantra…get it built and get it sold.
Its too much risk for rental purpose builds and it takes too long to pay off.
If there is some kind of super crash that hits Canada, it will be the tenants who can’t make the rent long before homeowners who can’t make their mortgage obligations.
I have been thinking about the two options available for a house-plex. Do you build strata units or a singular rental building?
My position about the affordability of housing has been that rental rates are the underlying cause of high home prices. If one can solve the rental problem in Victoria then the affordability problem of houses will correct itself. The best way to do so is to encourage more small developments of rental properties that have to compete amongst each other for tenants.
If we consider two identical house-plex buildings except one is a rental and the other strata there is huge difference in the total gross selling price of the strata building’s units compared to what one would pay for a rental building. The assumption is that a developer would build the most profitable of the two.
In high income neighborhoods near shopping and banking facilities, for example Cook Street Village, stratas would result in high prices for the strata units. But in lower income areas that have lower house and condo prices it may be more profitable to build rental buildings due to the lower land costs. Yet these neighborhoods still retain high rental costs. If you add in bonus density for building rentals in these lower income neighborhoods then the market value of a rental house-plex may be greater than building a strata house-plex in the same neighborhood.
Greater Victoria but more specifically the core districts of Victoria, Oak Bay, Saanich, View Royal, and Esquimalt is an oddity unlike Vancouver. Land prices can vary greatly despite that there isn’t great distance between the areas. Fairfield is not that far away from Burnside, Tillicum, or Mayfair, yet the difference in the land prices is substantial. One can buy a lot in Tillicum for $650,000. In Fairfield it’s around 1.1 million. But the price a tenant pays for a rental is the same. That’s odd as one would think there should be a substantial difference in the rents too. Even if you travel further out to Langford, the difference in the rents is not substantially different from the core.
$300 per sqft seems to be within reason, for example: https://cressmanhomes.ca/cost-to-build-a-house-in-bc-2023/ which puts this build at around $2.2 million for a 7,600 sqft building which is within range of the $2-2.5 million that I pointed top for that $1 million price tag (on top of land costs).
In building this legislation, the province has aimed to reduce fees per unit by forcing cities to set builder fees an in advance, and they are going to push for standard construction forms that will automatically be allowed under the rules — all of this might reduce costs.
Regardless, you disagree with my estimate, that’s fine. This is a hypothetical.
I think it’s highly likely that these units will cost far less than buying a SFH at the current price of a minimum 1.5-2.0 million in this neighbourhood, which even in that price range may come with a lot of added construction renovation costs
And if units don’t cost less than a SFH? Then people like me won’t buy them. So therefore, they won’t sell and developers won’t build them (just like what happened with the current Victoria city policy) which makes your opposition to this build form entirely irrelevant at that point.
Some people think prices are going to crash, or when they renew their mortgage at the current rates they are going to default and foreclose… both are fallacies. When I bought my house in the 1990’s It was the bottom, house prices had plateaued and they stuck for 10 years before any further price acceleration.
The nice thing about walking 3 blocks to buy your groceries is you also get to pay 50-100% more for the groceries with less selection.
Right, so for a 700 sq foot unit that’s $280k. But they’re not selling them anywhere near $280k. More like selling for $800+ per square foot. And Zach’s in a nice neighborhood with $2m SFH and $1m 1,500 sq ft townhomes.
My understanding is that you need to budget 400/square foot right now for building? I’m not sure that this is correct. If so, a 1900 square foot townhouse would be 760k just to construct. Hopefully those numbers are high and costs lower per square foot if it is a 4-plex. Marko probably knows.
Lighten up, Patrick.
Well, perhaps others can weigh in. Is it reasonable for Zach to expect to pay only $1m (or less!) for a brand new 1,900 (!!!) square foot missing middle unit in a neighborhood where 15 year old smaller (1,400 sq ft) townhomes are selling for $1m?
Zach expects … brand new and 500 more square feet.. for the same price as a similar 15 year old smaller townhouse . And I’m the one that’s “entirely detached from reality”?
Where are you living now Zach … in “La-La Land” ? 🙂
The poster reverts to “attack-the-messenger” instead of “discuss-the-issue”
Again a complete straw man and entirely detached from reality.
Townhome in my neighbourhood currently at around $1 million (some more some less). SFH I’m same neighbourhood starting at $1.5 million and up. Most are $2 million and up.
Same land that a SFH sits on could be used to build a 4 plex with 1900 sqft units under the new policy. Even if the total cost of land and build hits $3 million, units could go for as little as $750k. At $4 million cost (including developing take), the units still go for $1 million.
That’s new 1900 sqft unit for similar or less than I can buy a 1400 sqft, 15 year old townhome for today. And half the cost of a SFH in the same area, no matter the age of the building.
Okay, Karen.
I’m an advocate for more on-property parking, which would mean more available street parking That means more street parking spots for the person you’re concerned about who is renting the garage loft too.. It would be better if the garage loft tenant got a parking spot mandated for him on-site, but you seem delighted that the government has reduced these on-site parking requirements, so developer profits can be higher.
The new government regulations allow less on-property parking, which means less available street parking since some residents have to then park on the street.
It sounds to me like these missing middle people are just people who can’t get what they want.
I think street parking is the work of Satan. Every time I see a car parked in the street, I fetch my fan and smelling salts. How in hell can people argue over homelessness, wars and poverty when I’m forced to endure somebody else’s vehicle parked in front of my house? It seems a small price to ask the younger generations to leave town or pay $3000 to live in a garage loft so that I’m not confronted by the scourge of street parking. The only things that could possibly be worse than street parking are walking three blocks to buy groceries, or listening to a Rex Murphy podcast.
OK, so you’re looking for more space, a 1,900 square foot “unit” that may or may not be a townhome. So next question is, what do you expect to pay for that? Isn’t 1,900 sq ft. going to be $1m+, and that’s close to a median SFH! If you’re in a position to buy something like that, why all the talk about how you’re screwed as a young person and it’s the older generation’s fault. But you describe your current rent for a much smaller unit as “exorbitant” so isn’t it a pipe dream to buy a 1,900 sq ft brand new missing middle unit? These missing middle units are luxury prices, that will gentrify most neighbourhoods, and there’s way cheaper options for 1,900 square feet in a conventional SFH.
Now I hope you’re not like many young people, who are so fussy they insist their housing is new, shiny and modern. If so, good luck to you, and that’s not a generational divide -that’s you being too fussy for a first home purchase.
You could probably fetch 500 per month for a secured parking stall in the core. Charge extra by the kilowatt for ev stalls. Even throw in secure bike storage with ev chargers. A guy could make bank.
Patrick, I’m seriously wondering you’re actually located on another planet, or if you’re just pretending to be dense to win an argument.
I’m currently happy with my unit, not with my exorbitant rent, nor the fact that I am paying this exorbitant rent instead of buying solely to avoid the usurious mortgage interest I would pay if I bought the overpriced unit next door.
I also would like more space in the future, and I am open to many forms that might allow this. The current proposal would allow multiplex housing at 1.5 FSR (about 50% more dense use of land than my current townhome), which on Victoria lots would allow 1900 sqft per unit in 4-plexes built on standard lots. That’s a win for a lot of people.
I’m interested to hear that you exclude townhomes and multiplex from “missing middle”. What expertise do you have to make this arbitrary exclusion? These are the main forms of missing middle. The other form is low-rise apartments (2-4 stories).
Further, this parking boogeyman you are obsessing over is a straw man. As of today, there are only 2 sites in the entire region up zoned to allow anything other than multiplexes (legislative exchange; uptown) and this affects a tiny number of units.
…with ev chargers.
obviously we need more parkades in the core.
Making up theoretical stories again I see 🙂
LMAO case closed
Not as long as you, VicRE and KS112 🙂
LMAO, how long has Patrick been on HHV?
I wonder with some of the really big lots in Rockland, Uplands, parts of Oak Bay, whether there would also be a market for building some large, upmarket concrete & steel condos (with parking, haha, even dare-I-say-it 2 spots per unit), like 2,000 sq. ft one unit per floor type of units, 3 or 4 floors, or whether something like that is permitted.
Obviously not what the point of the legislation is…
I want street parking to be available as it is now, serving an essential role . For people all over the city to be able to park in the street when they drive somewhere else.
This could the plumber working on a job, soccer mums watching sports, visitors, mail/courier deliveries, a health home care worker providing care , construction crews, ambulance, police etc. etc.
That type of available street parking is important and essential.
None of that parking is available if the street has been taken over by residents using it as a permanent parking lot.
As I recall, you said a townhouse would be OK for you , and I know that some HHVers would settle for a townhouse. Which is why my call for anyone interested in missing middle “units” specifically excluded townhouses (because I think of them as family-friendly and close to a SFH)
But you’re renting one of these “units” now, and you’re on HHV grumbling about the generational divide that is screwing young people like yourself. I don’t get it, you’re renting in a nice neighbourhood, and “living the dream” in the dwelling type that you say is fine for you. So is the terrible problem that you’re renting and not buying?
Simple question, why don’t you buy the unit you’re renting ? (Or one like it).
Guy has no life outside of hhv, uses hhv as a means to fulfill the emptiness that is the reality of his life. Its pretty clear when you look at some of his posts.l, provides nothing of value, just endless Google links and theoretical stories made up in his mind.
Quite a sad individual, but typical of a significant cohort of people on internet forums.
You’re too funny. Sorry, did you think your “call out” was scientific poll?
I’m happy to buy a missing middle unit in the right place, size and location. I’m also happily renting one of those few units available in my neighbourhood right now.
I think what’s clear is the massive sense of entitlement of your position: you want the government to subsidy on-street parking for you and yours, even if it forces other people out of the city.
So go ahead: buy those SFHs for your kids. Buy properties with plenty of parking on the lot. And if not: buy in another city. You don’t have to live here. You can move.
That’s exactly the message that people like me have been getting from people like you for the last decade, and frankly I’ve got very little sympathy for people who feel entitled no only to the parking on the land they own but also on the street owned by the city.
Zach those towers are the affordable housing , the 4/6 unit small boutique building will sell for a premium and no better at missing middle than what’s being built in esquimalt . Having lived in kitsalino we had lots of 4 , 5 , 6 unit buildings and I liked them as they filled a need for a better looking well heeled couples but it kinda stopped there
Why do I care? I’m helping 3 kids to find housing in Victoria. They’re all looking for SFH. With parking. How weird is that? Same as you and everyone else on HHV.
I put out a post out to hear from for ANYONE on HHV to post if they were interested in buying one of these missing middle units, and not a single HHVer spoke up. It’s all SFH, just like you want.
The law of supply and demand applies to housing, but it doesn’t work if the product supplied (units) is different than the product in demand (SFH) All these units are ideal short-term dwellings for the 5,000 mostly well-heeled people per year that move to Victoria, and will likely help increase that number. And increase demand for the product they ultimately want (SFH).
And hey Zach, in case you haven’t you noticed, despite being young, you’re a big grumbler yourself 🙂
I’ve never gone grocery shopping on a bike or bus. Sounds like a real pain in the ass.
I can tell you that we have more than enough big towers, with small units and underground parking. It’s not solving the problem of building the kinds of homes that couples and families want, at the price point that is desired. Low rise, wooden structure multiplexes are much closer to achieving this than high rises or SFHs for far more people.
But, honestly why do you even care, Patrick? Where is your skin in the game or are you just here to grumble?
If “parking apocalypse” that you’re so obsessed with occurs, and on street residential parking starts filling up around the city — what is it to you?
That will be a problem for the people who own these new units who have no off-street parking.
How and why is that your problem, living in your SFH home with all the off-street parking spots that you need?
Are you just that guy who has nothing better to do than walking around his neighbourhood grumbling at all the parked cars on the street?
Back to parking, what I understood was the fact that we will be building a fair number of units without parking is exactly the reason why we should be charging for street parking. It would regulate and provide some certainty for people who need overnight parking. I believe that the city’s goal is to increase the number of people using buses and bicycles and to reduce the number of people who own cars. Charging a reasonable fee for overnight street parking should further those goals. Expansion of car shares should fill the gap.
I believe that this was always part of the vision of the MM when it was being proposed. It is why you need a walkable neighborhood since hopefully most people will not have a car.
This is not my idea of good policy but it is what people seem to have voted for both for city council and provincially.
Thurston, not sure what protection there is for historic designated homes, if any. I will try to enquire. But a limited number of homes in Victoria have historic designations. In regard to my house, I believe you can put up to eleven Units of about 800 square feet in the backyard in addition to the main house. But I am planning on going to the zoning department to get some clarification either this week or next.
I wonder what the impact on the value of SFH in Victoria is going to be as these six plexes start to be build next door to some homes?
Bullseye.
I’m wondering if peppering the neighborhoods with four and six suite strata buildings is the best way to tackle the missing middle problem. In order to build these buildings we are going to have to encourage investors to step in and take a chance. Being stratas these buildings will be in direct competition with high and mid rise complexes as well as creating a land lift for single family lots making detached homes more expensive.
Why are we doing this?
Wouldn’t it be better to encourage investors to purchase an alternative investment to a condo or a house? And we could do this by offering to investors a different product than a condo or a detached house that would be more profitable to them than say owning two separate condos or as expensive as house with a basement suite. Something in between the two.
We could do this by creating an investment property comprising say at least two self contained suites under one title. If you are nearing retirement and considering buying a property that will provide an income stream why not buy a property where you can live in one and rent the other(s) or rent them all out.
That may be more attractive to investors and draw them away from traditional condos that should be used for owner occupied units.
As it is now, the only choices are to buy two or three separate condos or buy an older triplex or fourplex and be an active landlord of an older property that needs constant maintenance. When the roof needs replacing it’s far better to pay $9,000 divided by three owners.
So would this entice Marko and Totoro to give up their separate condos and suited houses for an easier to maintain investment that would give them the same income but with less costs? In a building with other similar investor strata multi-units to share the common maintenance and repairs?
Things that make you go hmmmmm.
Marko muted me, but Gordon Head already has two neighbourhood grocery stores: Thrifty Foods (at Tuscany Village) and Mount Doug Market. There used to be a third (Save-On-Foods at University Heights) and there will be again once the University Heights redevelopment is complete.
I walk and more often bike to these stores. It is true that they aren’t walkable for many who live in farther flung parts of GH, though.
I’m confused by all this panic about parking. Is it prohibitively expensive to have a carport / garage at ground level, with units / townhouses above? Or does it violate building codes?
Barrister is there any protection for historic properties such as yours
The majority are 50′ or wider. Not only are there few 33′ lots but 33′ and deep lots are essential non-existent which means the FSR kicks in. For all intents purposes the 33′ discussion does not apply to Victoria.
However, curious if the big developers in Royal Bay and Westhills do anything different going forward….they do have 33′ lots current used for construction SFHs.
Yes an ADU is a garden suite.
I’d be fine with yard parking. It is legal and quite common where I am now (on holidays). Certainly better than street parking.
In fact, I’ve just updated my bucket list to add “see some legally parked cars in some front yards in the Uplands.” 🙂
I assume the car-lite thing is something temporary, not many stick with it after their twenties. I’d expect that most car lite people are also renters, as that would fit in with the sharing economy theme, and they likely can’t afford to buy anyway. So yes, these “car-lite “units could be good rentals for that crowd.
It just leaves me waiting for the family-friendly units, and I guess I’ll be patient.
Anyway, thanks Leo et al. I’ve really enjoyed the discussion and I’m talked out for now. Heading out to enjoy the day
Agreed one spot shown, But could easily fit 3 or 4 cars there.. I agree it doesn’t work as well with no alleys, however most lots in Vic are wider than 33′, opening up lots of other options. The prime MM lots won’t be 33′ wide that’s for sure.
But it is not. I looked at the design for the sixplex referenced by Leo for the 33′ lot. One car- presumably modo. Plus we don’t have a load of back alleys in Victoria. Hardly any. Lots in Oak Bay so fourplexes might work there if the numbers work overall – which seems less likely.
A new build unit in a six-plex that is 1 bedroom and den 1 bath and 740 square foot and no parking would be what – $740ish?
Hard to see that there is a price point where this makes sense in Victoria for this segment of the population given the existing options at that same price point unless it is maybe in Fairfield?
in any event, I think developers will be careful with this, it is their money on the line. i just wouldn’t get carried away liking designs that might fit on a 33′ lot but not be appealing for people who can afford 740k and aren’t already comfortably housed given that there are other alternatives.
https://www.realtor.ca/real-estate/26301507/413-530-michigan-st-victoria-james-bay
https://www.realtor.ca/real-estate/26324249/4296-torquay-dr-saanich-lambrick-park
I’ve always thought this makes sense. Almost no-one uses their front yard and we already have driveway parking in front.
+1, I play in a soccer league with some younger folks and they regularly arrive in Modo cars, etc. I know hard to imagine, people living without a vehicle of their own.
The parking is at the back. See the garage drawings for the SFHs. The guys is based in Vancouver where a huge number of streets have back alleys. Nearly universal in some parts of the city. Therefore you put parking at the back and have a much nicer streetscape.
Parking with six-plexes is a super easy solution, that no one will agree to. Allow front yard parking, see example -> https://maps.app.goo.gl/ncMW2pmsee25Ywbu6
Personally I am more concerned about access to health care and a roof over my head…..where people will park their crew cab F150s/SUVS is at the bottom of my concerns and as noted above if it is a major concern there is an ultra simple solution.
`Not saying it is a good idea to charge for on street parking, but I dont see a problem with it either. Considering what an hour of parking downtown costs me then three dollars a day seems pretty fair. He is probably right that it would encourage people to take the bus or ride a bicycle or just use car share a bit.
Whatever is a adu a garden suite , and where are u going with that as far as a structure
Correct, it’s not for you. It’s for people who (unlike most of the people in the comment section) are not already comfortably housed and are ok with living car-lite lifestyles close to transit. It’s very easy to lose track of the perspectives of that group when you’re older and haven’t had to worry about housing for years or decades. They may even (hold your ears Patrick) park on the street, but fundamentally it will appeal more to people who use a vehicle rarely rather than every day.
Providing options for those buyers means less competition for places with parking for people that depend on private vehicles for most of their transportation
Agreed.
There we have the 6plex on 33, praised as a “good concept” by HHV.
Yet there is one parking spot for 6 units.
And within the last 24 hours on HHV, we’ve had 4 assurances from HHVers that “not to worry”, that devs would be adding lots of parking…
Leo:” Developers still build parking even in the absence of parking minimums.”
Caveat: “Not too worried that there won’t be parking”
Dad:” I assume there will be demand for off street parking in many locations, and that developers would respond accordingly.”
Caveat: “it would be hard to believe that developers won’t include at least 1 offstreet parking spot per unit”
—=—-===—
Missing middle = street parking
Instead, build mega towers, with plenty of underground parking.
When it comes down to what will be the best marketable new house-plex in Victoria, I’m thinking that will most probably be a residence with a legal/permitted basement suite and one legal/permitted adaptable dwelling unit (ADU). A market for that type of house-plex does exist although it is smaller market than that of a house with just a legal basement suite. At four and more the costs of the project will be out side of the reach of most home owners and most contractors building on speculation for a future sale. The three unit project would also fall under residential lending and keep costs lower as this avoids underground parking, elevators, mechanical rooms, internal common stairways, etc.
If you want to build condominiums then that property will now be under the Strata Property Act. That will raise the cost of construction and the cost to the individual owners as the owners will need to have a reserve for replacement built into the monthly strata fees and a Depreciation Report performed ever few years. Smaller contractors, building on speculation of a future sale, will avoid this option as it increases the complexity of the project. A four storey walk up style building is not going to be well received in the marketplace either by elderly purchasers or families that have to haul groceries up three flights of exterior stairs. One would be limiting occupancy to those willing to trade off the inconvenience of several flights of exterior stairs for a superior location and those looking for lower cost housing.
Corner three storey town houses will only have one flight of exterior stairs the other stairs being internal that makes them an exception to the above. One could play around with the design of a four storey townhouse by recessing the ground level to be below grade by say three or four feet. In that way one could have a ground floor suite that you walk down a half flight of stairs and a three level town house over top with only one flight of external stairs to the first floor. The point being you want to limit the number of flights of external stairs.
Character house conversions are a boutique market appealing to a small segment of buyers. Character home conversions into strata condos are permitted under residential zoning. House conversions have been allowed in Victoria for a long time, but few character homes have been reconditioned as the costs are ridiculous and the construction time is a lot longer to upgrade an old home. One has to strip that old home down to the studs and rebuild to modern building standards. Those are sunk costs. Better to build two new homes than convert one old home.
There may be exceptions for the four to six unit house-plex, but only in the premium areas such as surrounding Cook Street Village or Hillside Mall, etc. Building a four to six house-plex outside of those premium nodes would be risky as the market for them is unproven.
I’ve omitted co-operatives as I have few nice things to say about them when it comes to market demand or financing them as one is not buying an individual unit, but a share in the entire complex. You are dealing with two things. Share Value and Market Value. They are not the same. If you don’t understand the difference, then you shouldn’t be looking at them.
.
Parking for one car. Not for me. Even in Asia they build a parking spot for each unit in six-plexes except in the most dense city areas.
I’m fine to live small and have done so for many years, but I had dedicated parking, a private yard and didn’t directly look into a neighbours’ windows . That is going to become rarer. I hate the shared back yard concept. I’d rather have no yard than a shared yard I have to walk through.
Myself personally as long as it’s top drawer nice construction and materials I would have no problem living beside what bryn had designed. I don’t think he’s a mother nature fan as hasn’t left 1 tree standing lol
“ Bryn on twitter puts out a lot of good concepts. 6plex on 33’”
Only thing missing from the drawing is the “for sale” sign on house of the poor sods in the middle.
“talked to a builder this morning and he says he read somewhere that hand deconstruction of a teardown in the COV doesn’t apply if replacing with a multiplex”
I see that 334 Dallas has disappeared in one day via hand construction bulldozer
Leo already outlined why your hypothetical is none-sense.
So the Latin quote applying here:
Errare humanum est, persevare diabolicum.
Bryn on twitter puts out a lot of good concepts. 6plex on 33’
https://x.com/lanefab/status/1733320625035583809?s=61&t=yQOlkjf_OqMVYckMZE3bgQ
Is that important? The people living in Gordon Head chose to live there, presumably because the neighbourhood is to their liking.
If someone wants to live downtown instead of in a suburb, they should just live downtown.
Hey Leo, I talked to a builder this morning and he says he read somewhere that hand deconstruction of a teardown in the COV doesn’t apply if replacing with a multiplex, only if replacing with SFH. I can’t seem to find anything in the bylaws, you know anything?
You should seriously open a consulting business!
And that’s not counting the other half that he’s (supposedly) muted and (pretends he) doesn’t see! 🙂
Every other comment on HHV is complete non-sense these days.
Totally agree,
Fair enough. I’m too old and cynical to remember if I ever thought like that 🙂
When you’re as hardcore a YIMBY as Leo is, (lack of) street parking is not going to bother you.
Right. Let’s be lectured to about walking everywhere and not needing parking. By a guy who has a car and a parking spot, and boasts that he drove 275,000 km in the last 8 years, and estimates he will do the same with his new car over the next 8 years too.
That cannot be correct for residential areas. Maybe for the downtown core metered parking they might consider a monthly permit for overnight parking in these zones.
You cannot remove parking minimums, allow 6-plexes and then charge 100-200 a night for street parking. Just never going to happen so I encourage you ask more questions from your Council member before posting this here.
In the most congested residential areas of Vancouver (like the West End) where they do charge for residential parking the permit is like $150 a year – which they are considering doubling. I think permit parking should be implemented here if/when street parking becomes an issue.
Spending a lot of time in a country where parking is just a complete chaotic disaster it doesn’t really impact my quality of life negatively. If anything people have less cars, smaller cars (like a VW Golf is a large car in many countries and then VW sells smaller cars such as the Polo, Up!, etc.), walk more, public transport is better, you have more amenities in denser neighborhoods. If a bunch of multi-plexes popped up in Gordon Head they might one day get a neighbourhood grocery store one could walk to.
I also think in the next 15 to 20 years (by the time these multi-plexes are built out) we will start seeing autonomous driving options reducing the need for personal vehicles.
Caveat Emptor,
You should check out Leo’s post. He now admits the “policy will allow 40 unit apartments” (6-10 storeys) in the case of <400m from transit exchange, which was what I said my “hypothetical” example post. And you said was nonsense.
This is a case where “Caveat Emptor” should again use his demonstrable Latin skills to post a “Mea Culpa” 🙂 to correct his cheap-shot false post as shown in the pic.
You can’t build just 1 bedrooms as per the bylaws. The 5,500 sq/ft lots will manifest themselves as two 3 bedroom units and four 1 bedroom units. This is why the Vancouver builders/developers are picking up the 7,200 to 10,000 sq/ft lot. On the bigger lots you have enough FSR to go all big units.
Plenty of availability in the 5,500 to 6,000 sq/ft range such as https://www.realtor.ca/real-estate/26190092/2553-vancouver-st-victoria-hillside
Only if they meet a minimum width requirement, which none of them do.
LMAO
Thank You. This is how Leo admits that he was wrong and I was right. I’ll take it.
Of course I have no idea where Leo lives, and that was clear from the “ ==== here is the HYPOTHETICAL =====” label I put above the story. Obviously that’s a “What if” and then specifically talks about within 400m of the transit exchange , where YES, you can build a 6 story apartment, and YES it could have 40 units. So Patrick was right all along
Why are we talking about transit exchanges? The answer is because that’s where they are allowing 6-10 storey apartments to spring up, if you live within 200-400m of one, regardless if it’s on your quiet residential street or not.
Great. Now we’ve revealed a point where I think myself and many Victorians would disagree with your position. And we have something to talk about, where there’s honest disagreement.
My position …
I don’t want a 6 or 10 storey apartment to be built on my street if I’m within 400m of a “transit exchange” (a glorified bus stop). And “oh, but I’m not living within that range”, doesn’t mean you’re safe for long. As more buses appear, by definition more places qualify as “transit exchanges”, so whether you are within this range can change from one year to the next depending on transit growth.
I don’t want my street to turn into a 24/7 parking lot for local residents. ,Why? Like you, my street gets lots of parking during the day/evening from various things (sporting/special events/deliveries.visitors). I LIKE THAT STREET PARKING as you do. That is the NORMAL and USEFUL street parking that I have no problem with and want to preserve. Residential parking on the street is a different beast entirely. They have residential permits and can just take up space. That PREVENTS all the useful things that street parking allow. So that , because residents parking is clogging up the street parking, soccer mums can’t find a spot on your street to park, visitors/ deliveries to your house can’t find a spot.
I recall HHV member Introvert mentioned that residential parking has become a problem on their street,. Perhaps Introvert can tell us why they don’t take Leo’s attitude where he claims he would really “not care a bit” about his neighbors using the street as a parking lot.
Just so we are clear what a residential street parking problem looks like, here’s a picture of an Auckland New Zealand residential street, which is crammed with street parking due to the apartment blocks (without adequate on-site parking) that have sprung up nearby. Auckland is the “poster child city” for density advocates. The Auckland residents park on the street and they need scramble with the other USEFUL street parking (visitors, workers, deliveries) to find spots to park.
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Totoro, I thought you lived in City of Victoria. Corner lots are 12 units and other lots are all six in the C of V. My local councillor says they are considering charging overnight parking of somewhere between $100 and $200 a night which should both reduce the problem, encourage bus and bike use and provide lots of revenue.
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So we are still talking about 3/4 years start to finish on mim . Even with mim allowed I’m not too sure what permit process will look like I’m guessing it could still be drawn out at blueprint stage . Councils in the past really use to have they’re say on everything from a tree to the shape of a window
Yes 6 units on a 5500 sq lot is going to be pretty tight . Those will be some very tight townhouses or I think they will just end up being more 1 bedroom condos
People who say they don’t care about parking usually say this because they have off-street parking. Having lived on a street without enough parking for all residents, I can say it is super annoying if you yourself do not have a secure off-street spot – especially if your area densifies.
With the new fourplexes there might be one spot for each unit on corner lots. Probably not on other lots? Seems unlikely for six-plexes.
In any event if you have only one spot and need two vehicles you’ll be in for parking wars eventually so something to plan for.
Patrick, when you write a weirdly personal story about specifically my house, and I don’t live near a transit exchange (like 99% of Greater Victorians), then why would we be talking about transit exchanges?
Secondly, if I did live near a transit exchange, I would still not care a bit about people parking on my street. And in addition to not caring I’d be pretty happy that my land value has increased because I can build 6-10 stories on the lot.
Sorry, not sure what I mean, you think MM dirt should be more expensive? I don’t think you factored in risk into your numbers and the 15% points you came up with isn’t enough. You have to think this a 3-4 year endeavor and the bank is paying 5.5% in a GIC right now, per year.
Why would there be a growing amount on interest in Fernwood versus elsewhere in the COV? No specific thoughts, the numbers depend on the price of the lot. I would buy a missing middle property behind Canadian Tire at Hillside Mall starring at the back wall of Hillside Mall, assuming the price makes sense.
As I posted a few days ago, you have to factor in that some areas may carry a >$200k per unit finished product premium over other areas. Right now MM are selling all over the place. Just in the last week MM sales in Fairfield, James Bay, and Oaklands.
Metro Vancouver but, you know, linkage:
https://www.theglobeandmail.com/real-estate/vancouver/article-price-paid-for-squamish-home-falls-200000-over-16-months/
https://www.bcassessment.ca//Property/Info/QTAwMDAyOUtZSw==
Thank you Barrister as that was what I was saying in my example of the six storey, 40 unit building, it would be near a node (exchange) within 400m as I said. These “nodes” in Victoria like Royal Oak exchange are just glorified bus stops by the way. No facilities, just a bus stop.
Yet Leo has told me I’m wrong, and he’s the consultant , and why don’t I know that we are only allowing 4-6 plexes. Anyways, Leo has fallen silent, likely he’s asleep, but hopefully he can clear this up tomorrow. Because I’m think I’m right, and we can build a 6 storey (40 unit if FAR<2.5) building within 400m of a transit exchange, like I said.
Can anyone confirm that all lots in North Saanich are fourplexs with 11 meter heights.
Fairfax (and all of the city of Victoria) is a six plex as Marko says unless it is a corner lot where upon it is a twelve plex. The other big exception is a transit NODE, which is different than transit routes. The NODES are where the rules for ten and six story buildings apply.
Correct me if I am wrong, but with the exception of the Highlands I believe every SFH lot in greater Victoria is now going to be a lot for a fourplex 11 meters tall. In addition those single family homes within the transit boundaries are going to be six plexs and then there are the other NODES with highrises of ten and six.
Heard that there is a growing amount of interest in picking up a number of houses in Fernwood. Any thoughts on Fernwood, Marko? Do the numbers work?
Marko yes I do remember I was pissing about with some numbers . It would appear to be more money for the dirt that sfh are sitting on at todays prices
Sounds like someone has never travelled outside of Canada/USA.
Fairfield is 6 plex, I’ll repeat for the third time.
Maybe I do need a consultation 🙂
I thought they were allowing 6 storey buildings within 400m of bus exchanges. Which was the example quoted in my hypothetical post that had 40 units.
And 10 storey within 200m of exchanges.
But you’re saying only 4-6 plex ???
What’s the 6 storey and 10 storey for Victoria all about then ?
https://www.mltaikins.com/real-estate/bill-47-2023-housing-statutes-transit-oriented-areas-amendment-act-2023/
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Leo cutting through the nonesense.
Honestly I should open a consulting business. How long have we been discussing the new regulations and whether they might allow 4plexes or 6plexes? And after reading the last 200 comments your conclusion is the policy will allow 40 unit apartments?
Yep no problem. Our street is already often used as parking for the local sports field.
I do think it’s funny that the scariest thing you could think of was that some people might park on the street. The street doesn’t belong to me, that’s fine.
Then the clouds will part, and a light will shine down from the heavens.
So for a 4 plex in Fairfield kinda fast and dirty . For 1200 sq unit selling for 1.1 with a 15 point developer return . I have 4.4 mil gross with a profit of 660,000 at 400 sq to build would put the value of a standard anywhere lot at 1.8 today am I close
Regarding allowing apartments with less parking spots. …
Nice try. But I’m surprised that someone who mentions they’ve seen tons of articles on reduced parking, then presents it as a simple binary issue, with only two options:
——- 1 if you have a car dont live there,
——— or 2. if you don’t have a car, feel free to live there
Because you’ve ignored the “elephant in the room” in terms of this issue, which is
——- option 3: if you have a car, move into a unit without a parking spot and park on the street, with a residential permit sticker on your windshield.
I’ll assume you of course know that, and were just in a hurry on the reply.
But let me give you a real world example, and all I’m asking is a simple yes/no reply to a question at the end. And that will complete the discussion on my part.
=====- here is the hypothetical =====
1. An apartment is built on the end of your (Leo’s) quiet residential street. It’s within 400m of a qualifying bus stop, so they can go low on the parking. There are 40 units, 20 with parking spots and 20 without. It’s all owned for purpose rentals, by a single owner who rents out all the units. (at this point, Leo is thrilled, exactly what he’s been advocating for, a purpose built apartment with some affordable units near transit . Wow! – great to see in the neighborhood! So far, so good!)
2. The apartment fills up with 40 renters quickly. The 20 with parking spots cost more but get rented by people with cars. The others with no spots get rented too, and the renters know there’s no parking for them. But it turns out that 15 of these 20 “no parking spot” people have cars after all. And they’ve noticed ahead of time that Leo’s street has allowable street parking, and has about 25 (plenty) of spots available. And they knew they could move in, and park on the street. Especially nice, are some nice spots in a quiet cul-de-sac at the end of the street, which happens to be right outside Leo’s house.
3. So now Leo has 15 cars parked on his street, especially in front of his house, and they change spots throughout the day as they come and go. All the parked cars have valid “residential parking “ stickers on them, obtained legally from Saanich.
4. Leo sees one of the drivers. He wants to ask him what he’s doing parking on his street, and always right in front of his house, and Leo remembers what he said to Patrick years ago on this issue. So Leo walks up to the guy and says “Here’s a crazy idea. Feel free not to rent a place with no parking if you need parking. ” The guy looks at Leo and tells him curtly to “take” off!
Now Leo hears some more wonderful news. Due to the success of the first apartment, the same developer is planning a twin of this building, adjacent to the first, so Leo will have two on his street. And likely 15 more “street parked” cars, which would be more than enough to fill up his street with cars parked legally with permits 24/7
—-====——-
Q. So now my (Yes/No ) question, Leo, are you still happy that the developer was able to get away with not providing parking, and that your street is now a street parking lot for this developer’s apartment blocks.?
Ok thanks Leo – I agree it’s confusing, but reading the govt comments under “short-term rental definition” in their Table under “Business Licence”, it looks like their 90 day restrictions will still apply. Maybe that’s just me reading it that way. I agree the guidance is confusing.
Note that slide is super confusingly worded. The cutoff to allow 4 units is 280sqm = 3014 sqft.
The 1215sqm is in relation to something completely different.
Yup: https://news.gov.bc.ca/files/STRPolicyGuidance2023.pdf
Page 6
Lots of Vancouver builders will typically have their own crews coming over to do multiple builds at once. Their labour is substantially cheaper than local builders, don’t ask why.
Does anyone know if the SFH lots in North Saanich are going to be 4plex with 11 meter height max. Thanks for the help.
Yup. Lots of research on this.
Cities all over north america are getting rid of parking minimums.
Here’s a crazy idea: Feel free not to buy a place with no parking if you need parking
If they’re not removing parking, what’s the point of the “near transit” then? There’s no cost saving.
Not sure, wasn’t expecting this development so I haven’t given it much deep thought beyond what I posted the other day. Missing middle lot in Vancouver can be $4-5 million in Vancouver while the house is only generating $4,000/month. Here you can buy 4-5 missing middle lots for the same amount and be generating $3,000-$3,500 per house. So if you are a small time builder/developer why not buy five instead of one.
I am guessing also just a lot more capital in Vancouver.
Well depending on their self interest, really. It’s called capitalism Patrick. The same flawed but functional system that provides me with nearly all I need for survival.
40-50% lot coverage? Not too worried that there won’t be parking.
What did greg martel’s house sell for? My RE insider contact is on vacation currently.
The new (ab)normal, we are dropping government regulations (lowering parking mandates), in return for “depending on the kindness of strangers” .. in this case profit-maximizing developers that are the same people that asked for the parking mandates to be dropped.
When we discussed this in HHV, there were lots of people in favour of the lowered parking requirements (for other people of course) . . They hear that some new units will not have parking, and they say “oh that’s just like me, since I drive less than I used to”. Sorry, but you still own a car and a parking spot. These new units may have no parking. Big difference.
Are there really? A fair number of “less-car” advocates . But few or zero “car-less” advocates.
I want to see good options for bike and transit because it benefits me personally and I believe it benefits the city at large. But I won’t be going car free and don’t think anyone else should unless they want to.
But those good bus and bike options might make it feasible for many working families to get by with one car when otherwise they might have needed two. Also expands opportunities for those who can’t afford a car or can’t drive.
I think one off street parking spot per unit makes sense. But I am also not particularly worried that a lot of units will get built without parking.
Fair enough. But they aren’t saying you can’t provide parking, they are just removing the minimums. I assume there will be demand for off street parking in many locations, and that developers would respond accordingly.
I’m with you 100%. I’m not the car-less advocate. There are car-less advocates on HHV though. And what’s the point of all the new government initiatives to “build near a bus stop and we lower the parking requirements for building”, if the expecation isn’t just that, ‘car-less” living. I can’t imagine a family with children living without a car for long.
That’s my reaction too. “I wouldnt take more buses , but likely someone else would take buses”. It’s like that with so many of these new housing ideas – they are all “do as I say, not as I do”. So yah easy to plan for OTHER people to “live in a tiny expensive unit with no green space, walk up a few flights of a single staircase and you’re in the family home! With no parking. Not to worry, there’s a bus stop for you and the kids 300 m away!”
I took one bus trip from Minneapolis to Winnipeg in the 1970’s. It was torture.
Does it have to be car-less living? I would never, ever switch to car-less living because I like doing things that require a car, such as leaving town, which is full of people, and going to places where the people are few. I might actually make trips by bus though.
No, but I could see more people making more trips by bus.
WhateverIwantToCallMyself,
Are you seeing what is being described here today in HHV posts. Namely a surge in purchases of missing middle suitable properties (vacant lots or likely tear down SFH ).
Does it cost more for local builders to build or Vancouver builders are self-financing? I don’t understand why the profit margins are lower than for a Vancouver builder.
Leo, what’s the source for that excerpt you had about the province walking back the 90 days? I agree it implies what you said, but was that an official gov’t source? – I mean, it just doesn’t make that much sense to me as it would be contrary to their stated goals of returning units to long-term rentals. And I still don’t see where this change shows up in the law, plus also the BC govt website continues to talk about the provincial rules being a ‘floor’ & that it’s open to municipalities to impose stricter rules.
The missing middle property sales are really starting to gain steam with Vancouverites….two today both with Vancouver buyer’s agents.
At this pace the local builders will be priced out. Wasn’t expecting this curveball.
With allowed lot coverages of 40% (large lot) and 50% (small lot) it would be hard to believe that developers won’t include at least 1 offstreet parking spot per unit, because won’t they have tons of room to do that?
The large lot definition is 13000 square feet. you could build the 4 units and have room left over for a medium sized parking lot.
$1.11 million also happens to be the price of a median SFH in Victoria. (November 2023)
I’m not surprised to hear that “one” Fairfield unit sold at $1.11m, but I expect most HHers to pass at those prices for a unit crammed with 3-5 others onto a previously SFH, when they could buy a median SFH (with their own lot) elsewhere instead.
Generally a municipal bylaw won’t overrule a mandatory provision of a provincial act or regulation unless the act or regulation explicitly states that a municipal bylaw overrules it.
The act clearly recognizes municipal bylaws as valid even with a different period defined for STR (Section 2 of the act). But nothing saying that Section 13 or 14 of the act would apply to the municipally defined period rather than the provincially defined period. Therefore I think that the registration and principal residence requirement apply to 90 days.
However I think they can still enact your interpretation through the regulations. The act defines the period for STRs “for a period of time of less than 90 consecutive days or another prescribed period”. The regulations could prescribe this period as “the lesser of 90 days or the period defined in a short term rental bylaw, but not less than 30 days” or something similar to that.
One just sold for $1.11 @ 7,200 sq.ft., FSR 1:1 so those are some good size units in a great location. I think that should be 5.5 gross no problem (900k/ish average per unit), but $7 million gross for a MM lot on Hollywood Crescent, Dallas Rd, or similar would not surprise me.
Costs improve with economies of scale. For housing this means building mega towers instead of overpaying for a tiny lot, and trying to cram 4-6 units onto it. This reality seems to be hitting the small time developers, and likely they will drop out of the picture, and the smallest mum-n-pop developers will go back to their day jobs.
I don’t think you are getting 1.1/1.2 per unit in a 6 plex in Fairfield with a lot that costs 1.2.
That is quite the needle to thread.
You would be taking a loss at $750k average per unit? That is only $3 million gross and the lot is going to be a million to start.
I think you need to aim for Fairfield at $1.1-$1.2 for the lot and $5.5 million gross, or higher, on a six-plex. Yes, fetching a million per unit +/- is not out of the question in the right location.
I was going to post this a few days ago but got busy and forgot. A number of builder friends that have vacant lots are sitting on them not starting for a couple of reasons
i/ Numbers don’t add up for SFH they were planning on building due to high construction costs/interest/etc.
ii/ Waiting for regulatory changes
Problem I see occurring is government bureaucracy dragging this out + implementation in building departments/permits….like this could take multiple years.
How can there be serious plans, if the government have told them (2018) simply that it’s not happening and they won’t fund it?’
Does the government believe that Victoria society will switch to car-less living, because of a bus stop within 400m? Other cities have modern mass transit.
I could see a Vancouverite living near a SkyTrain station. But would you expect any Victorian to ditch their cars, and move their family within 400m of the glorified bus stop called the “Royal Oak transit exchange”
I don’t remember there being any serious plans. I recall pipedreams of an LRT along the E&N, which never really made sense because of the route it takes. But the definition of “prescribed bus stop” did capture the #95 bus which is the closest thing Victoria has to rapid transit, along a route that makes way more sense for future light rail.
Spoke with a colleague this morning who works in a large professional firm specializing in residential development. All of their developer clients have pressed pause on their 2024 projects. Every single one. Everyone is waiting for the roll-out of the regulatory changes. He said he expects way fewer starts in 2024 from this alone given contract timing and the window for development. Add interest rates to this and the drop in starts might be quite significant. Maybe a big rebound in 2025 though.
better off building a large 4 plex on a 8000 sqft lot in Gordon Head IMO., you might get on average ~750k per unit.
In theory…..in practice you will have a hard time with FSRs, offsets, and everything else on a 2,000 sq/ft lot.
Fairfield falls under COV MM, not the province, that is where the difference is.
Marko So all of Fairfield is 6 plex no matter size of lot or on corner or not
Fairfield is 6 plex, fyi.
Good grief. This would be funny if it wasn’t a serious issue. One bus (going who-knows-where) arriving every 15 minutes is considered adequate to upzone for hundreds if not thousands of units? Do they think only handfuls of people are actually going to take them up on this? If the idea is that they will get more buses when the time comes, then why do they make this criteria in the first place? If they are planning for success, Why not just pick and plan the best routes for future mass transit, instead of planning Victoria’s future via silly rules like one bus every 15 minutes to somewhere?
The bigger point is, this fine tuning of what makes a “bus stop” adequate isn’t what’s needed.
IN ADDITION, what is needed is the government to be announcing plans for mass transit via light rail in Victoria. There were such plans (downtown to Langford by light rail, followed by other routes to Saanich). But our NDP premier Horgan announced on behalf of the government to Victorians to give up on this idea in May 2018, with a speech that timecolonist article describes as the NDP telling Victoria to “forget about light rail for the capital region”
There are recent efforts to start other light rail plans up, but a July 2023 TC article describes it as “dogged by funding rejection” https://www.timescolonist.com/local-news/west-shore-light-rail-pilot-project-dogged-by-funding-rejection-lack-of-viable-test-sites-7319907
Here’s the 2018 timescolonist article described by TC as the “ province giving up on what is obviously the way of the [Victoria] future.”
The question is, will the government now revive plans for light rail (or other MODERN mass transit) with necessary funding, or do they expect Victorians to live their lives tethered to a bus stop?
https://web.archive.org/web/20180522031825/https://www.timescolonist.com/opinion/editorials/editorial-no-case-for-light-rail-1.23307579
Here’s that article with no paywall.
https://toronto.citynews.ca/2023/12/08/times-up-for-some-short-term-rentals-in-b-c-as-new-housing-rules-transform-scene/
The changes would open the door to keep the existing house and build another infill that is much larger than was recently allowed . It wouldn’t solve the housing crises much but I could move to my backyard in 2000 sq with minimal investment. Am I missing something here cause this is shaping up to be a good idea
A few salient excerpts from this Rob Shaw article:
…
…
https://www.theorca.ca/commentary/rob-shaw-patent-nonsense-or-path-to-stability-be-prepared-for-ndps-housing-plans-either-way-7943895
Thanks.
Brave new world.
I’m thinking what’s a more profitable build . A luxury sfh in Fairfield or a 4 plex , cause I think for a builder that’s the only thing that really matters. Could see a wider gulf in prices between a condo/ townhouses and sfh going forward
Correct. Well, will be. Saanich just voted to scrap their 2 year missing middle engagement plan for a plan to implement the provincial changes by the mandated deadline of June 30th.
Here are the types that will need to be allowed on every lot.
But fourplexes are allowed everywhere in Victoria, correct?
That’s where I read it differently. What’s the point of recognizing that munis are able to define STR differently if that doesn’t translate into anything? I read it as if they don’t have a definition of STR, the 90 day provincial definition applies. If they do have a definition they can define it as 30 days or something else and then a 40 day rental is not classified as a STR.
Thing is I don’t know that many munis which have actual definitions. Victoria and Vancouver do, but the others seem to have left them undefined for the most part.
Isn’t that just section 2 of the Act?
For the purposes of this Act, a short-term rental bylaw, related bylaw or First Nation law is a short-term rental bylaw, related bylaw or First Nation law, as applicable, even if the short-term rental bylaw, related bylaw or First Nation law relates to a period of accommodation that differs from the period of time described in the definition of “short-term rental accommodation service”.
The 90 days will still apply I think. As in you’ll still have to register your 35 day rental. And you still won’t be able to STR something that isn’t your PR or secondary suite for 45 days
Timelines already slipping as I predicted.
“By late 2024 or early 2025 , the Province will establish a short-term rental registry.”
Question: Have they also rezoned most SFH into three or more units and if so can someone summarize the details.\?
Thanks
The horrors! Of course they are rentable long term at some price. And that’s the beef – it won’t be the same price they were getting as STR.
https://www.theglobeandmail.com/canada/british-columbia/article-times-up-for-some-short-term-rentals-in-bc-as-new-housing-rules/
What happens if they change the bus routes? Does zoning get added and subtracted. Does a temporary bus route for a month bestow new zoning.
Lots to digest here no doubt
Leo you need to open a consulting business advising on these changes. Starting to become difficult to follow!
lol, what a gong show.
Here’s another bit of news. BC gov walking back their 90 day thing if the municipality defines STR as 30 days that’s ok
I went a step further and asked the province. They confirmed it.
This also means almost nowhere in Victoria will allow sixplexes. Only the number 6 and the 95 bus qualify as frequent service under the provincial standards
I’m going to agree with Leo (easy to do because of how solid Leo’s analysis is) and say that this depends entirely on what people plan to buy and where.
If the BC provincial policies go through, we’ll be seeing massive high rises around all skytrain stations and major bus loops. Those homes will be most economical as 1-2 bedroom condos which are slated to be more plentiful and likely they will be in sufficient supply to meet demand (not that many families who want to buy these). Expect small condos to get cheaper as rates drop.
Whereas SFHs – the price on these unlikely to drop substantially in any major BC or Ontario city unless there is a highly unforeseen further rise in rates, or massive unexpected recession, particularly if coupled with a future government that dials back substantially on current immigration levels.
I’m not betting on any of those things happening, so there’s a good chance that SFH affordability only modestly (and briefly) improves, for people who time their purpose just prior to the expected drop in rates perfectly.
Seeing quite a few Vancouver buyer’s agent on the reported sales, will be interesting to see what the quarterly numbers show for origin of buyer when they come out in January.
“Landlord Pierre Poilievre won’t reduce your rent”
https://twitter.com/vancolour/status/1732958412873601514
Exactly what I’ve been seen on the ground. Friends in constructions can’t get PR, those with university degrees in BS get PR no problem and then obtain desk jobs, ideally government. Don’t get me wrong, I am happy for my desk job friends but if we are going to solve housing you would think there would be a priority on construction workers. Obviously there isn’t.
Don’t worry, there are no signs government is rushing legislation.
Leo, I appreciate this tailored information! Thanks!
Although only Uptown and Parliament are transit node designated by OIC currently, the others (UVic, Langford x2, View Royal, and Royal Oak) come into force June 30, 2024. I wonder if we’ll see some 10 or more story towers at UVic.
news.gov.bc.ca/files/HousingGuidelines_Regs_SummarySlides_V2.pdf
The congestion in Sooke is insane, I will never go out there again. It makes the highway 1 crawl look like a hay ride. They do not have the infrastructure in place to support the development…Big time.
Sorry, I thought you lived in Sooke.
Max, I live in Victoria.
Barrister… “I find it a comfort that my house has a sprinkler system”. Water damage is huge. Whats the traffic like in Sooke these days? I went out there to renew my DL…Miles of congestion…I couldn’t believe how far backed up it was.
Any thought given to protecting the historic parts of downtown??
For the CofV, is it any different than the missing middle as far
as the transit stop designation?
6-plex guidance
It seems the others must be designated by June 30, 2024:
https://news.gov.bc.ca/files/HousingGuidelines_Regs_SummarySlides_V2.pdf
Yes, that it huge re. skytrain. Still – if the frequent transit service routes are accurate for Victoria that is an incredible shift.
I’m referencing the report info which states this, but your info is def more accurate if it is in the regs/manual.
Biggest impact is on Skytrain here, where there are a number of stops that are surrounded by single family which now allow no less than 20 stories.
We should see additional TOAs designated with time in Victoria. Both the city and the province can designate these.
Agree. The others are not yet designated so may or may not be designated later.
Page 171 of the report has Victoria’s expected TOAs. I see these are estimates. I’d expect the frequent transit routes to expand as densification increases – notes this in the report.
I only see uptown and legislature, where do you see the others?
https://www.bclaws.gov.bc.ca/civix/document/id/oic/oic_cur/0677_2023
I believe it’s 10 stories within 200m (3.5FSR), and 6 stories within 400m (2.5FSR), independent of build materials.
Note that the report says those are the areas used in modelling, not necessarily the ones the province will use. So this isn’t quite certain yet.
Transit oriented areas have been identified for Victoria as well. Downtown around the Empress area, UVic, Uptown, Royal Oak, View Royal exchange and two in Langford. If I read the materials right if you are within 200-400 meters of a TOA you have a new minimum height of 10 stories for concrete and 6 stories for wood frame?
Leo, are you able to overlay a map so we can see the potential boundaries? Property values just went up in these areas imo.
My read is that they are taking the combined service times of the buses – not single route times. It is an absolutely massive coverage area to build six-plexes as of right on a single family lot with no parking minimums.
Whoa, that runs counter to my assumptions below based on reading of the SSMU guide. I have a question in to gov’t staff to get clarity on that.
Leo’s already been consulted by the province on housing related matters.
Oak Bay is going to have a breakdown. It looks to me like all of Foul Bay (to Fort and then down Fort to Oak Bay Junction) and Henderson to UVic will be in the frequent transit route.
And the Province is now quoting Leo in its press releases!!!
“Of the suite of reforms passed this fall, removing barriers to transit-oriented development has the potential to deliver the most new housing in the shortest timeframe in B.C. In a time of rising construction costs, de-risking approvals and reducing costs for housing is crucial to address the shortage of homes.”
https://news.gov.bc.ca/releases/2023HOUS0171-001945
Have you seen the Schedule C map for Victoria’s frequent transit network (p.. 166) – it is massive.
Good news for introvert. The 27 and 28 while marked as frequent service by BC transit, does not meet the provincial definition because it doesn’t run on 15 minute intervals on the weekend.
For the purpose of being able to build a 6 plex with no parking minimums
Regulations and modelling report is out https://news.gov.bc.ca/releases/2023HOUS0171-001945
The report: https://news.gov.bc.ca/files/bc_SSMUH_TOA_scenarios_Final.pdf
Nelson, which is a city, is a lot higher. But yes Victoria along with St. Catherines-Niagara appear to be at the top of the CMAs with large populations.
https://www12.statcan.gc.ca/census-recensement/2021/dp-pd/dv-vd/imm/index-en.cfm
@Marko to your earlier question about construction workers in immigration, from a BoC speech
That is quite obvious, and I never said otherwise. It also applies to living in one of the most beautiful cities in the world (Boctoria) , judged #1 best small city in the world by Conde Naste readers. That increases Victoria homes value to many buyers, including retirees from NYC. Don’t forget, Victoria has the highest percent of American born people living it of any city in Canada,
Exactly, for someone who supposedly done lots of travelling this simple principle should be quite obvious.
A few “deals” snapped up recently.
Little bit of a sales resurgence recently (new lists should say -11% to be clear)
I find it a comfort that my house has a sprinkler system.
My point is that the Swiss are doing something else for their building code which results in such a dramatically lower death rate. What they are doing might be even more expensive than a second staircase for all I know. I am guessing we are doing the cheap alternative already.
Wrong, Here are some facts:
1. R2 values are the same whether it is a log chart or not.
2. A R2 correlation of 0.736 (r2) is considered strong/high in any event, since it is above 0.70.
The affordability ship has sailed and everyone missed the boat.
We’ll see if B.C. and those demanding action on affordability are in it for the long run.
I’m not in the market. Happy to keep what I’ve got. My interest is helping my kids find houses (SFH) to buy here . Their budget is median SFH range, I’m not smart like Totoro, and so I didn’t cleverly snap up a few places for them years ago.
Well I appreciate you going on record with saying in 10 years the Victoria “SFH affordability likely worse, multi-family better”
And we agree on ”worse SFH affordability”.
Where we differ is when you said last week that “prices are cheap when there’s enough supply to meet demand”. Because you don’t meet the demand for SFH by tearing them down and supplying multi family units. What you are doing is enabling someone to move to Victoria and live in a shoe box micro-unit… where you actually INCREASE demand for SFH. And I think that’s what’s happening to Victoria.
Anyway, time will tell, and it will be fun to see what happens. I’ve enjoyed the discussion.
The only reason New York exists is because it densified. For the people that live there, the housing that was built allowed them to live there when they previously could not. If there was no housing for them it would be infinitely unaffordable, but it’s not because that housing does exist. If it didn’t New York would be a podunk town with no political or social influence.
It costs more to live in 800sqft in New York than it costs in Victoria not because density caused New York to be unaffordable, but because living in one of the most economically powerful cities in the world is a lot more valuable than living in a mid size government town.
Nope. Classic hot dog problem. Just because you see a pile of hot dogs doesn’t mean there are enough hot dogs.
There’s a serious housing shortage in New York. Lots written on this. If they had more homes it would be more affordable.
Single family affordability likely worse.
Multifamily affordability better.
Of course it only makes sense to compare to the counterfactual, in which case I am extremely confident affordability will be better. But even compared to current levels this is likely true.
The point is that as New York densified, its affordability worsened.
Any New Yorker who said “let’s densify, it will make homes more affordable” was wrong.
Just like any Victorian who says “let’s densify, it will makes homes more affordable” is wrong.
I say…. Ten years from now, Victoria affordability will be worse.
Are you willing to go on record, and give a simple answer to this simple question?
Ten years from now, assuming we densify and build aggressively, Victoria affordability will be ?worse ?better ?same than now.
R2 value below 0.8 in a typical log chart (watch out the units) means the data points are not really correlated. I wouldn’t call any R2 value below 0.95 is “high correlated”
Would New York be affordable if it was a bunch of single family homes? The question doesn’t even make sense, because the city wouldn’t exist. Totally silly way to look at this
No serious person doubts that supply and demand applies to housing. Tons of examples showing it does.
Patrick…what’s your budget?
You are singing to a choir, your visions of grandeur will never come to fruition.
Well no, I said “ This doesn’t prove causation, but it does show that raising density by itself isn’t likely to improve affordability. ”
Meaning that density advocates can’t point to data that says increasing density will improve affordability. So I then ask, if we’re not improving affordability.. as Basil Fawlty would say . “what’s the bloody point?”
You seem to imply that density is causing the unaffordability. It is more likely to be caused by what’s called “Third Factor C” where a third factor C causes both A & B. In other words, B is not caused by A but both A & B are caused by C.
Here C may be:
Desire to be close work
Blocked on one side by Water
Availability of Public Transit
Large Centralized city
Etc.
And don’t wine…its always been tuff.
Life’s a tuff gig.
Dude, there is no affordability.
There’s an obvious reason that density advocates aren’t promising “affordability”. It is simply because the data shows otherwise.
So when Victoria becomes dense, it will still be expensive.
Because the data shows a high co-relation (r=0.73) between higher density and worse affordability. This doesn’t prove causation, but it does show that raising density by itself isn’t likely to improve affordability. There are no cities on the list with high density and affordable prices. Victoria won’t be the first.
“ the denser an area, the higher its house prices”
https://kevinerdmann.substack.com/p/does-density-increase-local-prices
IMHO this is the bottom. The clouds will part and the sun will shine in 2024.
Side note, I saved myself $41 per month switching from 5% deductible to 15% deductible earthquake insurance. $237 per month down to $196. Its insane how much insurance costs these days.
Patrick I don’t think the yimby list was about affordability, just more homes for the right kinda folk
Usually all it takes is something to get built near to you, that changes everything. It’d be nice to think that you’d be different. But if a few 6-plexes with no parking get built on your quiet street, and the street starts to fill up with street parking, I’d expect there’ll be YIMBY’s becoming NIMBY’s. Another example is if you wake up and there’s a homeless guy who has pitched a tent on your front boulevard . Chances are you’re so instantly transformed to a NIMBY you’re phoning the cops immediately.
So far the only argument I’ve heard against this, is people saying “it won’t happen”. And as long as they’re right, there’ll be YIMBYs.
At first it sounds like a good idea to reduce the number of staircases. But is won’t reduce the price people pay for a suite. All you’ve done is give a bigger profit to the contractors. As the contractors costs are lower they can now pay more for the land. And land prices go up.
I’ll get back to you on that in 5-10 years. We’re certainly not fixing a problem 40+ years in the making overnight.
Missing the point. What it proves is that taller single stair buildings aren’t death traps. If they were it’d be impossible for countries that have tons of them to have a very low fire death rate.
Likely, not a valid comparable. There is probably a housing type that is more prevalent in Canada where the deaths are occuring from fires than in Switzerland. For that metric to work it would need to be compared to similar housing types, and then the regulations followed by the deaths broken down into the categories. North Korea is reporting far fewer deaths in electric cars than Canada… Well, North Korea must be doing something right in regulating electric cars!! lol.. or is there another reason… Like they don’t have them.
And why is their fire death rate so much lower?
I wonder what will happen when everything on the YIMBY wish list gets implemented but it doesn’t result in affordability.
They have a special building code to allow this. Not allowed anywhere else in Canada.
Depends on the height. 4+ stories yes. 3 and under generally no.
Ostensibly, but in the real world there is no additional risk in a modern building to a reasonable height. It’s just out of date regulations that have serious downsides for housing affordability and design
Switzerland literally has no height limit for single stair, they have tons of low/mid rise single stair buildings, and their fire death rate is 5x less than ours.
Parts of Montreal have really nice wrought iron exterior stairs
which seem ideal for small buildings.
I’m just going to assume you’re trolling.
Aren’t fire resistant materials mandatory?
What’s wrong with parachutes?
What is wrong with a metal exterior fire escape?
Aren’t sprinkler systems mandatory?
It’s for fire safety. In case one route is blocked (like by a fire or smoke), you have an alternate way out that’s not an elevator. The higher you go in buildings the less likely a window egress can be used.
Could someone explain the single stair access regulation on multi- storey buildings. I assume there are elevators in these buildings.
Roger I hope not , the 90s sucked I would much rather have the 80s a faster up and down
We are happier than Americans even though our income is 25% less 🙂
I think there will be a long window (5-10 years) from 2023 where the prices will grind lower, somewhat between the 2008-2013 cycle and the 90s bust. The renewal/refinancing cycle has barely begun and there will be ripple effect from this, 2024 recession, and associated job losses.
Why would the government need to finance something if it is economically viable? Plenty of builders/developers building market rental housing right now even without government financing.
Weird how Auckland was able to legalize missing middle and didn’t have to pay for it all.
Whether we need to pay for it to get it built is entirely up to the government. Make shitty restrictive rules that make building uneconomical and you will have to subsidize it to get it built. Make permissive simple rules that make building economical and you only have to subsidize if you want it below market.
Canada is the most conservative in the world, other than Uganda on single stair access.
For the government to be successful with the missing middle they are going to have to finance a lot of it. This will provide an opportunity to also create a lot more rental units which is the focus of this government.
I expect to see a very large Provincial fund to support the development of rental missing middle in the near future. Otherwise all you will see is a few million dollar condos being built and that is not the goal of this government.
On a different note does anyone know what terms CHMC is lending money for the developers to build high-rise rental?
What percentage and for what term.
Good example. There is only so much money on the demand side. Permitting increased density on all lots doesn’t change that, and you still have the same amount of money for the same amount of lots.
Just keep in mind in the COV where the rules are out >95% of properties have seen zero increase in value and <5% that has seen some the increase in value if very small. The $1.1 million dollar Fairfield sale last week, I think that is over a million just for the purposes of a luxury SFH.
Province looking into legalizing taller single stair buildings.
It’s like they’re checking off everything on the YIMBY wish list
Plus delays/extensions.
Released by the province but not implemented on the ground. That will be July 2024 to Jan 2026
You would that if you’re sitting on a sfh rental that it would be best to hold off till the new rules come into place . Don’t want to leave any money on the table , I like the 6 mil idea
Doubt it, I am willing to bet that municipalities will ask for extensions.
So most of the new rules should be in place by the spring I guess. As I’m itching to sell a house next year maybe like some others
And MM condos in the Oaklands area will fetch $2 million or 700k more than the brand new SFH listed in the Oaklands area right now, makes perfect sense
Just remember elected officials are a representation of the people; therefore, why ai think we will never solve the housing crisis in my lifetime.
Highly doubt it. CHMC already has minimum size requirements for developments for financing. They prefer big.
What kind of flat roof assembly are you doing that’s going to be less than 18″ to 24″?
Realistically you need 40′ and even if it was 40′ it would not matter whatsoever because you would be maxed out on FSR long before you needed the 4th story.
I suspect that a lot of the MM is going to end up being financed by BC Housing and other government agencies. So 8ft ceilings will be common in those builds.
So what is the standard height for a four story building? Eight foot ceilings take up 32 feet. I dont imagine that floors are more than foot thick. The presentation to the city asked for 36ft flat roof in order to accommodate four floors. But you do development so what is the minimum height for four floors.
Elected representative: I was talking to a realtor and he said that because of the 6plex regulations the value of a $1M single family lot is now $6m
jfc
I thought the same. Four stories and 36 feet only works if the ground floor is partially below grade. They won’t be building new MM buildings with 8′ ceilings.
They are coming out today/tomorrow.
You know what, let’s double your estimate from 220 to 440/sqft.
440 × 7000 = $3,080,000
Land $1,200,000
Soft costs/interest/etc. $1,000,000
That’s 5.3 million.
And no it doesn’t have to be a private loan. I am financing a development through a credit union right now. You have to keep in mind to start you aren’t burning much in interest as most developers have some capital. You start burning a lot towards the end of the project (i.e. the construction loan isn’t advanced in one piece when you start but rather via draws).
No it isn’t. There is this thing called the floor assembly and other factors.
Maybe. However if I was on Council I’d be looking to pause this and wait for provincial transit node and multiplex regulations. Silly, confusing and expensive to go down a different path.
Totoro: Thank you for checking. We are back to four story buildings on the corner lots and three and a half high on the other lots.
I think council voted in favour of proceeding with the amendments.
I’m going to throw out a guess the next 6-8 months will be a good time to buy. The Spring market that some sellers are expecting to be “hot” and are waiting to list (or re-list) might not be as they expect. That’ll bring further inventory onto the market pushing down prices.
<two sets of plans so far (no building permit issued) and both builders are going with more parking than the minimum. If you have a bigger lot (bigger units) the market will demand parking. You won’t be selling a 1,200 sq/ft 3rd floor unit easily without parking.
I wouldn’t be surprised if top notch locations had underground parking and elevators even for sixplexes. The gross sales on some of these is going to be over $7 million.
~~~~~~~
the problem behind that 7 million gross is a private loan…. i can tell you it is not p+1.5% for 12months– the rate is more or likely p+4-5 range with 2% lender fee + another 1% typical broker fee.. that 7.2+4+2+1=14.2%…. good luck find a builder with 220/sqft for hard cost in town.
I work 6 hours per day 5 weekdays per week. 7am to 1pm. I hit highway 1 at 6:30am and I’m in Rockland by 7am. I leave Rockland at 1pm and I’m home by 1:30pm…It all in the timing.
There was a time when the west shore was considered a satellite community. Not so much anymore since its pretty much the hub…Now its Sooke, Mill Bay, Duncan, Cowichan. Satellite communities always get hit the hardest in a down turn
Totoro: I will not speak to BC politics, but in Ontario, regulations were closely linked to boiling a frog.
Totoro:I believe the amendments were actually passed. But, I might be mistaken, so can anyone confirm?
They are mining mountains for building lots (and the aggregate)…Land values are going to stick. South Island anyway.
As I interpret the term houseplex it is a building with multiple units including an ADU. The entire property being registered under one Certificate of Title. Otherwise it would be necessary to re-zone the property and comply with the Strata Act.
For most of you reading this blog this may seem meaningless, but on a valuation level it is extremely important as there is a large difference in the price that one would pay for the land.
The problem with building affordable housing isn’t so much the cost of construction -it’s the cost of the land. Any legislation must be tailored in a way not to increase land costs. What makes Victoria unaffordable is the high land to building ratio. If one could wave a magic wand over Greater Victoria to reduce land costs then that would encourage new construction. As it is now most Victorians are living in properties where 75 percent and more of the entire properties value is situated in the land component. The ratio should be down to about 50 percent.
IMHO people in detached around the 1m-1.2m range have been there for awhile anyway and are not really motivated to do anything. They have no problem staying put for another 10 years. The top heavy 1.5m + that’s another story.
I don’t think your going find any kind of detached forever house jem anytime soon, perhaps some debilitated shit pit buddy can’t afford anymore, reminiscing a money pit for the new owners. People just aren’t that strapped.
That was published in the Times Colonist and seems like amendments are proposed: https://engage.victoria.ca/missing-middle-housing/
https://www.timescolonist.com/local-news/victoria-overhauls-missing-middle-housing-rules-to-kickstart-building-7617745
The term is covered in the Act, in the broad section 3h. You can see the graphic I posted from the BC government web page, telling you how they value land. Complain to them (not me!) about what you believe to be differences in the “act” vs their methodology. They may just point you to the line 3h) “any other circumstances affecting the value of the land ” catch-all in the Act that lets them use whatever they want . That would seem to include “highest and best use” to me.
You are free to expound on “highest and best use”, but that term does not occur in the Act. Market value is of course what a property would sell for in an open market with arms length and rational buyer and seller.
(3) In determining actual value (which is defined as market value), the assessor may, except where this Act has a different requirement, give consideration to the following:
(a) present use;
(b) location;
(c) original cost;
(d) replacement cost;
(e) revenue or rental value;
(f) selling price of the land and improvements and comparable land and improvements;
(g) economic and functional obsolescence;
(h) any other circumstances affecting the value of the land and improvements.
Does anyone know for sure the amended height max for Victoria MM. Other wise I should phone the city.
Market value of the highest and best use. The term “financially feasible” is interesting and open to interpretation and likely appeal if necessary. .For example, if you have a $1m lot with a $2m new house on it, the assessment is $3m. But it wouldn’t be “financially feasible” to tear it down (cost $3m) to build a multiplex. So maybe the best use stays at SFH, and your assessment stays where it is, unaffected by upzoning.
https://www2.gov.bc.ca/gov/content/governments/local-governments/finance/requisition-taxation/local-government-taxation/property-assessment-classes#:~:text=Land%20is%20valued%20based%20on,potential%20rather%20than%20existing%20use.
Sorry sloppy wording on my part
Market value which reflects highest and best use.
BC Assessment Act says market value.
There may be little or no change in lot value since the value is tied to actual FMV. Since the whole city has been rezoned the price of a lot may not have gone up much if at all.
If there is already a new home built on the lot, the best use for tax purposes should be staying as a SFH. And the owner is already paying higher tax. So a higher tax should only apply to lots that are good (likely) candidates for multiplexes. Those would be lots with “tear downs” (low assessed values of the buildings). I’d expect this will partly occur naturally with the assessments, because they’re only increasing the land assessment not the building. So hardest hit %-wise would be a lot with a tear down.
I was told that this is correct:
The changes are expected to simplify regulations for developers by eliminating the requirement for both an adaptable dwelling unit and rental unit within missing-middle projects, increasing the maximum height of houseplexes and corner townhouses to 11 metres for flat roofs and 12 metres for other roof forms and …Sep 29, 2023
Can someone confirm that this was the September change?
11 meters is 36 ft, the standard height for four stories.
Both Justin and Steve are sort of correct. BC Assessment does value based on highest and best use, though if you are in a single family lot and have been there for 10 years you can apply to be exempt from that. So assessed value of the lots that call for way higher density will rise and that will cost those owners more in taxes. But everyone else pays less in taxes because those owners take on more of the tax burden, so it’s just redistribution, not an increase.
More taxes as a consequence of a jump in lot value is not something I’m going to cry about for those owners.
That’s not true. Any development that increases anticipated population on the site can charge ACCs
https://twitter.com/j_mcelroy/status/1732107383193862390
Corner lot max is 10.5 meters.
Plus you have to have all of these:
b. Notwithstanding subsection a., houseplex and corner townhouse are permitted only if the lot contains all of the following:
i. at least one adaptable dwelling unit that is not a secondary dwelling unit;
ii. at least one secondary dwelling unit, except where all dwelling units are secured as rental in perpetuity;
and
iii. the greater of two dwelling units or 30% of the total dwelling units are three-bedroom dwelling units, at a minimum.
https://www.victoria.ca/building-business/permits-development-construction/rezoning-development/missing-middle-housing
I’m aware that the regulations have already been written and the policy manual must be in a near final draft form to be released next month. Are you suggesting that all of this work and the released information is incorrect and somewhere in the back rooms there are discussions “oh, we should follow the City of Victoria because their missing middle is working so well”?
Ludicrous.
Can you send a link to this? I understood corner lots in the COV you could do townhomes you it was an extra wide lot but I don’t remember hearing anything about four stories. They increased the max height from 9.5 to 10.5 meters to accomodate three stories but I didn’t see an exemption for corner lots to be higher than 10.5 m.
The infrastructure concerns in Oak Bay are legit and preexisting and well-known. An engineer refusing sign-off is also a legitimate reason not to develop further.
I don’t see this as being a stalling tactic (although could play out that way longer term), but rather a legitimate concern and where is the financing for upgrades going to come from and at what cost. The Province is promising money, but there needs to be a multi-year plan for this.
Totoro someone has to pay if not the developer then the taxpayer , your property tax would skyrocket, we are already seeing big increases with a lot more to come
Totoro: You are aware that regs can be amended by simple order in council.
What are you going to do as the builder/developer when a p.engineer signs off that the sewer on the street installed 100 years ago cannot handle additional capacity? What about storm? Water? The water main in Oak Bay is ancient.
The anti-developer munis such as Oak Bay and View Royal will try every trick in the book to prevent development without admitting that is what they are doing.
First, we will start with the request for extensions re bylaws come end of 2024.
What municipal infrastructure update charges for a developer? My understanding is that under the new legislation amenity contributions will be prohibited for missing middle housing. Only higher density developments than the new mandatory minimum can require a developer contribution.
“twelve units in Uplands”
Uplands will keep it as is for a long time. Put aside of the zoning bylaws by Oak Bay, I don’t think any big developers want to take the risk or any small developers have the capacity to build a missing middle there because the municipal infrastructure updates will cost a fortune, just look at the update at Hampshire & Cavendish as a perfect example. Only luxury condo starts from $2mil+ may be work, but the buyer market is very limited.
The province has already released the regulatory minimums through its PR materials and the policy manual to the regs will be released next month.
The regs will state:
Are partly or wholly in an urban containment boundary established by a regional growth strategy, or
With a population over a threshold that will be prescribed through legislation that is within part or all of an urban containment boundary established by an official community plan, or
With a population over a threshold that will be prescribed through legislation(if neither (a) or (b) apply)
A minimum of 3 units must be allowed on parcels that are 280 square metres or less
A minimum of 4 units must be allowed on parcels that are greater than 280 square metres
Some exemptions apply
The minimum population threshold is 5000.
https://www2.gov.bc.ca/gov/content/housing-tenancy/local-governments-and-housing/housing-initiatives#:~:text=Small-scale%2C%20multi-unit%20housing%20%28SSMUH%29%20describes%20a%20range%20of,that%20can%20provide%20attainable%20housing%20for%20middle-income%20families.
Building that many condominiums under the missing middle would kick the crap out of the hi-rise condo market.
Better to keep the missing middle as apartments rather than stratas.
Totoro: The bill and legislation puts in place a regime governed by regulation and the regs are changed or put in place by order in council. It might be prudent to await the regulations. But I dont have a dog in this matter.
Marko, I believe it is four stories on a corner lot.
It comes down to numbers and you have to keep in mind in premium areas you could be fetching $200,000 more per unit for the EXACT same product just on the basis of location. An identical condo in Fairfield versus behind Hillside Mall could be $300k+ more.
This is essential a missing middle condo -> https://www.realtor.ca/real-estate/26167634/302-1014-park-blvd-victoria-fairfield-west
The only difference is the actual missing middle will be three stories, instead of four.
I’ve seen two sets of plans so far (no building permit issued) and both builders are going with more parking than the minimum. If you have a bigger lot (bigger units) the market will demand parking. You won’t be selling a 1,200 sq/ft 3rd floor unit easily without parking.
I wouldn’t be surprised if top notch locations had underground parking and elevators even for sixplexes. The gross sales on some of these is going to be over $7 million.
This is one of few luxury SFH homes on a street entirely made up of multiplexes in Zagreb – https://maps.app.goo.gl/sAvkDbpxsBgiqh2p9
The last few sales of the SFH homes have been for absolutely insanely high numbers in relation to homes 15 minutes outside of the core in SFH only neighborhoods. Reason being is scarcity, because everything that is being built out in the core is multiplexes there simply aren’t luxury SFHs available, but there is demand.
You have to keep in mind multiplexes being built in premium areas like Fairfield will be a premium product and only one story taller than a brand new SFH home. You also have to keep in mind the units in these multiplexes will be over $1,000,000/each.
Finally, if everyone in 10 years is building multiplexes new SFHs simp0ly don’t exist, but I doubt the demand for SFH disappears. Therefore, you will have the option of buying a luxury newer SFH home next to a brand new luxury sixplex or you can go out to Sooke and buy a new SFH on a large property where you don’t have to worry about multiplexes, and spend 3 hrs commuting each day.
That is incorrect. There is no debate on whether to follow the City of Victoria by doing some sort of 12 unit expansion from 3-4 units depending on size of lot. The bills and legislation have already been drafted and all the public information released on this by the government confirming this.
Because you can build bigger and more asthetic units that sell for more $ which should more than offset the incremental cost of construction.
Totoro, I believe the regs are not finalized and there is debate whether to follow C. of V.
According to the technical briefing, the stated intent with MM is to require municipalities to allow at least four units on lots that are larger than 3,000 sq feet, and at least 6 units if said lot is within (200m?) of a bus stop with “frequent service”. Why pay for 8,000 sq ft of land when a standard issue city lot of ~5,000 sq ft will do? Older houses on or close to busy roads will be the prime candidates imo.
I see a lot of those 70’s houses in gordon head as prime candidate, they are all sitting on large 6000+ sqft lots and crappy ones can be had for under 1M. The finished MM product should fetch a higher premium than the ones in Oaklands etc as it is in a better neighborhood.
I don’t see that the missing middle zoning regulations will allow for twelve units in Uplands – or anywhere in Oak Bay not in a transit node. Four seems to be the maximum. It would be up to Oak Bay to amend the bylaws to permit more that the provincial minimum- which it is never going to do.
After reviewing the realtor.ca website I failed to find any deals lol. Big gap still between sellers expectations and the prices they’ll fetch. If anyone is buying RN they got suckered.
Wasn’t someone arguing that it won’t impact values? Jesus christ, it’s going to have an impact even if it is 2 doors down and across the street not to mention if its next door.
Oh that is the one that was asking 350, that is a serious bath I wonder why so motivated.
I think the point is that a new multimillion $ house next door is a lot less likely to get torn down than an old dump.
Tomtom: I believe that they spent a whole week looking at Oak Bay but the real estate lawyer they hired said that the provincial regulations when finalized might cause a similar
problem. I did not talk to them directly.
If the provincial regulations are similar to Victoria when they are finalized then if it is possible to put up twelve units on a lot in the Uplands then you are looking at about 200 to 250 a door which seems more than doable considering what the units should sell for. Obviously, need to wait for the final provincial regulation to come out.
If this is the primary concern with 4mil budget, why looking at Fairfield not the nice parts of South Oak Bay and Estevan Oak Bay? There are other two new constructions on Anscomb pl, the listing prices will likely near 4mil, and this location beat most parts of Fairfield for a 4mil new SFH.
It started with the Toronto people thinking about the view and then believing it is a problem for most houses in Victoria. Will this impact large segments of the market, time will tell.
Having a small, old home in front of your house is an issue for anyone with a view dependent on that house height – before or after missing middle. Always a good idea to visualize these sites redeveloped to max building height before you buy because there is no right to a view.
There is definitely way more selection out there than there has been and way less competition. A number of homes listed near us have not sold in more than 60 days. There are likely some anxious sellers with mortgages coming up for renewal who are willing to consider lower offers right now.
Now where did my wife put my crystal ball this time? My gut tells me that it is rather unpredictable for the next year but with more downside than up. Condos might be particularly vulnerable in my mind. I wonder to what extent condo prices were set by their economic utility as AirBnBs. I also wonder, considering the frequent mention on here of owners who rent out units but with a negative cash flow of whether a lot of units will be put on the market after higher mortgage renewals if there is a perception that prices are either stuck or declining?
I think the SFH market might also be facing a rather unpredictable year ahead. My neighbours best friend had flown in from Toronto, him and his wife really loved a new built house on Shotbolt in Fairfield. Apparently about 4mil asking. Great views with large windows was a lot of the appeal. What killed the deal was that the house next door, which is small and old (and a bit downhill which allows for the view) is a prime candidate for the MM. Not only would he lose his views but also any sense of privacy because or those picture windows. The question is that while you can buy a SFH it is not one that is actually in a SFH neighborhood. If you believe that having a three or four story MM built beside your SFH is not going to have a major impact on your house price then you have really been drinking the cool aid.
But, I dont have any magical insight but Canadian real estate seems like a shaky house of cards to me at the moment.
2024 and 2025 I think there’s lots of time to snag a house on sale . I also think the worst to come for the economy will be next year , so if your a buyer and your brave this is when good deals are made
I think once the new year comes around there will be a surge in pent up inventory coming on market from those that have delayed selling into a declining market or with high interest rates. However, that is likely to be paired with a a frantic blip in sales due to those that have been waiting on better inventory snap up some properties. This will be short lived because the cost constraints and economic pressures will drag and flatten out the market as the year goes on. Even a 25 point drop in BoC rates in March or June won’t be enough to spur the market as first time and move up buyers continued to be sidelined by unaffordability. As the year rolls on, the impact of the renewal wave will have a greater and greater impact pushing more inventory to the market with fewer qualified buyers to pick up the slack. That said, deals are out there now…. If I can find it now, I will go and get it, just no desire to overpay because time and money is on my side.
It only took them over 10 years to figure it out.
Short-term rentals have ‘significantly impacted’ housing affordability: Desjardins
https://www.timescolonist.com/national-business/short-term-rentals-have-significantly-impacted-housing-affordability-desjardins-7919364
Great article, and great advice! Thanks.