Vancouver's Real Estate Market

[Hondaracer]

Originally Posted by Badhobz

This is kinda interesting.

https://www.youtube.com/watch?v=DX_-UcC14xw

This is actually a great video and once again, underlined in typical Canadian fashion we enact pointless legislation with no forethought or plan to make is successful.

I’m actually (kind of) directly involved in CoVs multiplex plan and funny enough I just got an update this morning from one of the CoV planners I work with

Any guesses how many multiplexes have been approved since this rezoning took place more than a year ago?.. wait for it… 14.

14, almost predominately 4 plexes built by who else, but buddy guy builders. I have not met one builder of any of these multiplexes who isn’t a brown guy with a family of labour behind him. They are -the only- ones who can make these builds viable financially.

Let’s do some math, turn 1 single lot into 4 units. 14 x 4 - the original single unit (which is being generous as most had at least a basement suite before)

In a years time, with god knows how many people are involved in this from the city side, CoV has added… 42 additional units. Wonderful.

Btw, so each one of these are subject to the development fees mentioned in this video PLUS hydro forcing them to go underground and have a transformer on their property.

Well say $65,000 per unit = $195,000

Plus, again being generous with the hydro service, $80,000 for an LPT on your
Property

$275,000 in development fees and hydro before you even put a shovel in the ground.

GG Vancouver, can’t wait for the homeless count to triple.

[SSM_DC5]

Since you have an "in" with cov planners, wtf is up with the delays with reviewing change of use applications? No physical changes to the space, just reviewing of drawings needed. Send some inspector to verify the next day and be done with it. Shits been like 3 months. Ppl have a business to run, rent ain't free. Oh am why the eff does the city require you to know the hours of operation as part of this change of use process? They plan to strictly hold the applicant to those hours?

[Badhobz]

so the video says that if you work it out, at 1.9 mil for the land, and development costs, it'll roughly equal 1 million dollars for a ~500 sqft 1/4 piece of these multiplexes.

who in their right minds would pay 1 mil for 500ish sqft when apartments are on a downward trend? You can easily buy a 2 bedroom 800ish sqft apartment for 800k almost anywhere in the city right now.

and WTF with the parking requirements? makes total sense to me that they need to supply parking as otherwise you'll have a constant street battle for parking, but holy shit can you imagine digging up a 4000sqft lot to put in underground parking?!?!?! WTF

[supafamous]

Originally Posted by Badhobz

so the video says that if you work it out, at 1.9 mil for the land, and development costs, it'll roughly equal 1 million dollars for a ~500 sqft 1/4 piece of these multiplexes.

who in their right minds would pay 1 mil for 500ish sqft when apartments are on a downward trend? You can easily buy a 2 bedroom 800ish sqft apartment for 800k almost anywhere in the city right now.

and WTF with the parking requirements? makes total sense to me that they need to supply parking as otherwise you'll have a constant street battle for parking, but holy shit can you imagine digging up a 4000sqft lot to put in underground parking?!?!?! WTF

Well, he does conflate a few different zoning rules together to make that example so it's not entirely accurate - the parking requirement is Coquitlam's, the density requirement is California's and the land cost and development fees are Vancouver's so the example is the worst case scenario.

The reality isn't that far though and the worst part right now are the development fees. The fees eat up 10-20% of the total cost of development which is a killer for making a project profitable. The parking regs are less restrictive in places like Vancouver or Burnaby - usually .5-1.0 spots per unit.

It's still really shitty though - from what I can tell most multiplex projects in Burnaby do not pencil out as profitable right now, same with low rises b/c of the development fees so even though Burnaby has relatively permissive zoning rules no one is building anything.

[Hondaracer]

Originally Posted by Badhobz

so the video says that if you work it out, at 1.9 mil for the land, and development costs, it'll roughly equal 1 million dollars for a ~500 sqft 1/4 piece of these multiplexes.

who in their right minds would pay 1 mil for 500ish sqft when apartments are on a downward trend? You can easily buy a 2 bedroom 800ish sqft apartment for 800k almost anywhere in the city right now.

and WTF with the parking requirements? makes total sense to me that they need to supply parking as otherwise you'll have a constant street battle for parking, but holy shit can you imagine digging up a 4000sqft lot to put in underground parking?!?!?! WTF

The parking requirements aren’t the worst part, the EV charging requirement is.

In Vancouver each one of those spots has to have an EV charger. EV loads are calculated separately from your units, the second you have 4 EV chargers on your property you almost always need a transformer on your property.

So now, on top of the physical space needed for your parking requirements, you also need to make provisions to install a transformer, and everything that entails, the bonding and grounding, access, right of ways, etc.

[Hondaracer]

Originally Posted by SSM_DC5

Since you have an "in" with cov planners, wtf is up with the delays with reviewing change of use applications? No physical changes to the space, just reviewing of drawings needed. Send some inspector to verify the next day and be done with it. Shits been like 3 months. Ppl have a business to run, rent ain't free. Oh am why the eff does the city require you to know the hours of operation as part of this change of use process? They plan to strictly hold the applicant to those hours?

From my point of view it seems like they have very few plan checkers. It’s almost always the same 2-3 people I deal with.

In comparison to your example, underground civil work for Hydro or Telus, the review and acceptance timeline is 4-8 months depending on complexity. So take into consideration how long it takes a utility to scope a project, draft revision after revision of their plan THEN submit to CoV for approval, and THEN wait for acceptance.

Underground civil work for BC hydro or Telus is taking 8-24 months from intake to construction.

[bcedhk]

The province's SSMUH plan is putting lipstick on a pig. The amount of resource (staff time, money spent on 'consultants' to provide the guidelines and marketing) probably could have been better spent to focus on 1 or 2 provincial lands and construct a high rise tower.

I'm anticipating a lot of cookie cutter EI builder fourplex (cctv monitor in the kitchen, veiny fake marble tiles, glass stair railing homes, etc) that will go for 1.3 to 1.5) million each in 2 years time.

[Badhobz]

Originally Posted by bcedhk

I'm anticipating a lot of cookie cutter EI builder fourplex (cctv monitor in the kitchen, veiny fake marble tiles, glass stair railing homes, etc)

thanks for describing my mcmansion

[supafamous]

Originally Posted by bcedhk

The province's SSMUH plan is putting lipstick on a pig. The amount of resource (staff time, money spent on 'consultants' to provide the guidelines and marketing) probably could have been better spent to focus on 1 or 2 provincial lands and construct a high rise tower.

This isn't an OR problem, this is an AND problem. We have to do both (and we have to do all the other options too including more social housing for example). As the video notes we're short 5.8m houses for 2030 (right now we have about 15m houses in Canada) and in 2023 Canada built 240,000 new units. Back of napkin math says we need to increase the number of houses we build by 300% to 1m a year.

As might seem obvious it'd be impossible to increase our rate of construction by that much right away (or even over a few years time) but at least we should make it easier to close the gap which includes making it possible to build all kinds of housing - not just concrete high rises but cheaper wood structure buildings (concrete costs a lot more to build - I've heard 20-30% more).

In addition, high rises don't serve the biggest gap in the market which is family sized housing (3 bedroom, 1000-1500sf units).

Originally Posted by bcedhk

I'm anticipating a lot of cookie cutter EI builder fourplex (cctv monitor in the kitchen, veiny fake marble tiles, glass stair railing homes, etc) that will go for 1.3 to 1.5) million each in 2 years time.

So basically like things are today? I hate those homes but I'll take just having more homes over saying they have to be nice homes right now.

[Hondaracer]

Poorly built homes are a detriment to all involved though. Everything from insurance to maintenance etc. becomes increasingly unaffordable if you have poorly built homes.

A huge issue on the west coast here is how you have to build given the weather. Building science for pacific north west wooden structures is actually fairly complex and if not done properly can be catastrophic (see leaky condos) so if no one but the cheapest builders can build homes, it has a cascading effect on the industry.

[bcedhk]

My point is that most cities already have a multiplex zoning in place before SSMUH. It has clearly been proven to be a failed housing choice option, which lead to SF owners holding onto their property or trying to sell them at inflated prices, to which most developers see no value in given mounting high risk and interest rate.

There's plenty of 3 bedroom units for sale in the high rise market. People are being picky and not willing to spend 1 to 1.3 million on those units because they all want ground-oriented THs or duplexes.

[GLOW]

i've always enjoyed Uytae's videos, they're always well put together and articulated.

[Great68]

Originally Posted by Hondaracer

In a years time, with god knows how many people are involved in this from the city side, CoV has added… 42 additional units. Wonderful.

Btw, so each one of these are subject to the development fees mentioned in this video PLUS hydro forcing them to go underground and have a transformer on their property.

Well say $65,000 per unit = $195,000

Plus, again being generous with the hydro service, $80,000 for an LPT on your
Property

$275,000 in development fees and hydro before you even put a shovel in the ground.

The development fees and timeframes will be massively lower when the province adopts its standardized designs, which you can see here: https://www2.gov.bc.ca/assets/gov/fa...talogue_v1.pdf

If someone works to one of these designs on the standard lot, the city will be forced to auto-approve it.

This is basically Vancouver special all over again.

That being said, what individual homeowner would want to do this? The whole reason I bought a property with a yard was so that I didn't have to share it with three other families, I'm sure many others feel the same way.

[JDMDreams]

Is it even worth it to build your own house now, or just buy something a few years old used. Everyone I've spoken to about building their own is always over budget and pain in the ass with the city

[Hondaracer]

Originally Posted by Great68

The development fees and timeframes will be massively lower when the province adopts its standardized designs, which you can see here: https://www2.gov.bc.ca/assets/gov/fa...talogue_v1.pdf

If someone works to one of these designs on the standard lot, the city will be forced to auto-approve it.

This is basically Vancouver special all over again.

That being said, what individual homeowner would want to do this? The whole reason I bought a property with a yard was so that I didn't have to share it with three other families, I'm sure many others feel the same way.

Yea that home owner/builder mentioned in the video is a bit of a misnomer, I’m sure it almost never happens in CoV unless the intention is to build and sell the whole thing

[bcedhk]

If I am optimistic, the multiplex will probably see it's uptake in the next 5-10 years when the boomers die off and the homes are inherited by their kids who have 250k+ net incomes.

[hud 91gt]

Decent duplexes on the west side are selling 5mil (for bith). An extra 800-1000sq/f to build, way more complex electrical, and the need to ask 1.5m+ for a 1/4 parcel? Doesn’t seem too appetizing.

[snowball]

Originally Posted by bcedhk

If I am optimistic, the multiplex will probably see it's uptake in the next 5-10 years when the boomers die off and the homes are inherited by their kids who have 250k+ net incomes.

I need more multiplexes built around me ASAP. Call me a NIMBY but I'd rather take a bunch of multiplexes/townhomes than the zoned for 6-storey buildings surrounding my house.

[supafamous]

Originally Posted by bcedhk

My point is that most cities already have a multiplex zoning in place before SSMUH. It has clearly been proven to be a failed housing choice option, which lead to SF owners holding onto their property or trying to sell them at inflated prices, to which most developers see no value in given mounting high risk and interest rate.

Most GVRD cities did not have a multiplex policy in place before SSMUH - only Vancouver and Coquitlam did and even then it was for triplexes in the most limited of circumstances. Some cities had a laneway policy but only Vancouver has had it for more than 5 years. It's simply not true that it's a failed housing choice because it didn't exist and what did exist didn't play on a level playing field.

Case in point - Vancouver's blanket duplex policy reduced the amount of housing you could built on a lot to .7FSR compared to .86FSR when a detached home was built. That's a lot of potential lost profit there but there's enough demand for 3 bedroom units that there's been significant construction of duplexes under this policy (I don't have the numbers in front of me).

Norquay Village (around Kingsway/Earles/Slocan) is one of the few examples of multiplex/townhouse type zoning actually working. The city rezoned that area to allow for duplexes, triplexes, and stacked townhouses and practically every single development there since that happened has been one of those homes - nobody has been building detached in that area at all. (the aerial view in the video is of Norquay with all the stacked townhouses).

Originally Posted by bcedhk

There's plenty of 3 bedroom units for sale in the high rise market. People are being picky and not willing to spend 1 to 1.3 million on those units because they all want ground-oriented THs or duplexes.

What's your measure of "plenty"?

East Vancouver for sale:
- 1 bedroom condos: 225
- 2 bedroom condos: 199
- 3 bedroom condos: 46 ($650k-$1.6m), (885sf to 1327sf)
- 3 bedroom townhouses: 57 ($700k-$3m) (924sf to 2000sf)
- 3 bedroom duplexes: 120 ($1.1m to $2.4m) (1000sf to 2000sf)
- 3 bedroom houses: 64

So 3 bedroom condos represent 16% of all available 3 bedroom units in East Van - is that your definition of "plenty"? They are a quarter as plentiful as 2 bedroom condos as well.

Between $1m and $1.25m there are a total of 36 units of any kind of housing available for sale with 3 or more bedrooms while there are a total of 1,409 houses for sale across all of East Van.

The numbers get better in places like Surrey but to say that 3 bedrooms condos are plentiful compared to other 3 bedrooms seems like a real stretch.

[68style]

My buddy who flips condos for years is caught with his pants a bit down after all these years.. he has a 3 bedroom he had to complete on in New West and he can't even get offers at just under $1M despite the assessed being over $1.2... 3br condos are a tough sell it's townhouse money.

[JDMDreams]

^^ I thought about picking up a penthouse unit too. And my realtor advised no. The numbers didn't make sense, it's the most expensive, hard to rent, sell, especially you can't air BNB anymore, fee's are the most expensive. It's easily $600+ a month just for strata.

[Hehe]

The requirements are one thing... the building cost is just absolutely banana for YVR.

I don't understand how building a SFH home now costs upward of $300/sqft. And this is for houses that are 3000sqft+, anything less than that, the cost per sqft just goes even further. Premium build would be north of $600/sqft

And that's for residential. For commercial builts, here is even more crazy as they adhere a more strict code on weight bearing and whatever.

But for reference, my family did a flip down in GA. We did an almost full-scale refurb (stripped almost down to the frame. Very good bones, but the place was severely behind in maintenance) to a 130 units multifamily project at roughly U$70/sqft.

Our commercial unit building project, a 12000sqft retail/light industrial with full 6" concrete at 4000PSI to support 3000+lb/sqft and built everything beyond the code for things like earthquake and tornado... the full cost including the separation in between to split the units and basic interior (loft on certain portion) decor was just under U$210/sqft. Granted we hired our own team and everything so our cost is minimized as we cut many middlemen. But still... converting it to CAD, the cost here is absolutely crazy relative to US where the average income is higher than ours.

[JDMDreams]

^^ I've wondered about this, is it a bc thing? But then I look at Nanaimo/ Island and new builds are 50% of the price here $1.2m. Same laws and province, new builds slightly out of Calgary was like $700k for detached

[Hondaracer]

Well.. all those auxiliary costs are built into the final price. They are just passed on to the buyer its not like the builder just absorbs them

[Gerbs]

Originally Posted by Hehe

The requirements are one thing... the building cost is just absolutely banana for YVR.

I don't understand how building a SFH home now costs upward of $300/sqft. And this is for houses that are 3000sqft+, anything less than that, the cost per sqft just goes even further. Premium build would be north of $600/sqft
.

My friends drafted his own team of EI builders, when we were golfing he said $300/sqft days are gone, closer to 350-400/sqft actual w/ 10-20% contingency for errors.

He makes < 5% on the flip but 10-20% profit on construction margin. One of the few guys I know that has saved > $1M before 30 without inheritance.

Projects are so high cost and risky even for him that he's taking 6 months off to wait for better deals than to try to risk for a break-even build. Clients aren't building either