Vancouver housing strategy misses the mark

Blog, Poverty, Steve Lafleur

A new housing and homelessness strategy came before Vancouver City Council July 26th. Its stated goal is no less than to eradicate homelessness by 2015. Aside from the impossibility of the goal, lumping general housing affordability and homelessness together into one strategy makes little sense. The housing affordability crisis in Vancouver exacerbates homelessness, but chronic homelessness isn’t a problem that can be eliminated simply by reducing rental rates in the city. A large percentage of the homelessness problem is caused by substance abuse and mental illness, and the component of the homelessness problem that falls into those categories needs to be dealt with separately.

Despite the muddled approach, the general recognition that the housing affordability issue needs to be attacked from the supply side is encouraging.

As the report pointed out, nearly 30,000 market rate rental units were built in the 60s, and the rate declined steadily to the point where only 6160 units were built in the 2000s. According to one estimate, the city now needs 65,000 rental units per year to keep pace with demand.  The report calls for the creation of 40,000 new rental units by 2021, 8900 of which would be subsidized housing. Unfortunately, the report—which is more of a brochure—is pretty vague on just how it will encourage the private sector to build 31,000 units over a decade, when it only built 6160 in the last. There are reasons why that private construction wasn’t happening, and it isn’t clear that the city is going to remove the roadblocks. The report mentions “optimizing zoning,” but lacks specifics.

The report also calls for the creation of 7900 subsidized low income housing, which will be little more than an expensive Band-Aid. While it helps some people at a very high cost, it does little to influence housing prices for the rest of the low income people in the city. In the wake of the Olympic Village scandal, the city really should have learned their lesson about social housing by now. The only way to solve a problem caused by an excess of demand for rental units is to increase the number of units on the market. Social housing is the most expensive way to do this.

To their credit, council has made some smart zoning changes recently, such as allowing the expansion of laneway housing, but it isn’t clear that zoning changes will be enough. After all, land is very expensive in Vancouver, since it is in short supply. One potential way to ease the supply issue would be to gradually open land in the Agricultural Land Reserve (ALR) to high density development. But without doing so aggressively, it is hard to envision the city reversing its trajectory towards higher prices.