Monday, November 21, 2011

Vancouver Update: The Apartment House Cometh

"When [planner Harland] Bartholomew asked what abuses he should consider in the [Vancouver] interim zoning by-law of 1927 he was preparing, the chairman replied that 'the only serious abuse . . . is the intrusion of undesirable apartment houses into residential districts . . . .'"  -from Zoning and the single-family landscape: large new houses and neighbourhood change in Vancouver
A few weeks back I brought up Robert Fogelson's finding in Bourgeois Nightmares that restrictive covenants (and later zoning regulations) were fundamentally intended to prevent speculative increases in land value, rather than, as one might assume, to guard against value declines (it's an idea I've also discussed here).  A story out of Vancouver, about an upzoning of a formerly single-family residential area along an arterial street now served by rapid transit, shows how this same concern – and specifically an equation of value increases with perceived neighborhood decline – are still very much alive today:

"Six months after Vancouver City Council approved a plan to transform the Cambie Street corridor, homes in the area have nearly tripled in value and some residents fear development will ruin the neighbourhood. ... last month a block of 10 homes along Cambie Street near 41st Avenue sold for $3.4 million each — nearly three times their previously assessed value."

Although the article quotes one homeowner who is dismayed at this turn of events, it appears most are content to take the developers' money without complaint – and why not, since the city has in effect handed each of them a winning lottery ticket, the proceeds of which are derived from public investment in the new rapid transit line.  There seems to be a shared understanding among residents, however, that the changes afoot along this corridor will "ruin" the neighborhood, a refrain that has been heard a thousand times in American and Canadian cities since the late 19th century. 

A primary purpose of the Vancouver zoning code, as shown by the introductory quote, was after all to enshrine in law the anti-urban prejudices of progressive planners and well-to-do homeowners in the face of the increasing desirability of apartment living for Vancouver residents (the fear of an "intrusion" was no doubt motivated by visibly growing demand for apartments).  The zoning map, largely unchanged in its important features since the 1920s, still carries out this mission, barring apartment housing from around 70 percent of the city area.  In the face of this suppression of supply, any rezoning of a formerly single-family detached area for mid-rise multifamily housing is bound to result in especially steep increases in land value, with or without adjoining transit.

Rather than causing a re-examination of land use policy, the soaring home values evident in the city seem to have resulted in the blame falling on foreign buyers, and especially Chinese buyers.  The chain of causation may be backwards, however: rather than it being wealthy buyers who are bidding up property prices, is it possible that wealthy foreigners are simply among the few who are able to buy into Vancouver's already supply-constrained market?

The Zoning and the single-family landscape paper, although almost 20 years old, summarizes the situation best:
"The research concludes that Vancouver addressed symptoms of the problem but not its cause: a zoning practice that continues to exclude the less affluent from single-family zones. Vancouver needs to espouse a more inclusionary zoning schedule that adopts the compact land use and mixed tenures typical before zoning and preserves the traditions of local residents. Otherwise, the zoning changes may preserve single- family areas for affluent immigrants as the Vancouver market aligns itself with the global market."
h/t Market Urbanism for the article.

Related post: Vancouver and the Zoning Straitjacket


  1. "The chain of causation may be backwards, however: rather than it being wealthy buyers who are bidding up property prices, is it possible that wealthy foreigners are simply among the few who are able to buy into Vancouver's already supply-constrained market?"

    That's a really good way to describe the problem! I've often wondered if the similar complaints about "rich people turning New York into a millionaire's playground" are backwards: maybe the constrained supply and soaring demand for housing in New York has pushed up the prices such that only the rich can afford to buy in? Vancouver and New York aren't gated communities - that is, they didn't set artificially-high housing prices to "screen" the entrants from the get-go - but rather the supply of housing was constrained and eventually outstripped by the demand.

    "Upzoning" used to occur organically as needed (like a 'safety valve' for housing to reduce demand pressure), and there understandably was a lot of concern over speculation and the unpredictability of growth under this system. But today's formal, planned, slothlike, bureaucracy-laced upzoning procedures (where they even occur) don't seem to be working too well either, at least in urban areas like Vancouver or DC or New York. Historically cities (markets) found a way to induce balanced growth such that all classes - from the very poor to the very rich - could easily find housing in them, but that doesn't seem to occur quite as easily anymore.

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