Oh Dear landLord

Vancouver is Canada's most expansive city to live in and a sole sector acts as the major culprit: housing. Every other sector pretty much compares or even fares better than other Canadian provinces.

Land, with its scarcity, is an extremely valuable commodity. Since most metrics are monitoring housing prices, it comes as no real surprise that value keeps increasing. We can't create more land. The underlying story the numbers can't explain though is how this actually translates into overpriced condos or rental units in a city that maximises its land by building upright.

For answers, one has to look back a little and of course give credit to sound city planning and a clear vision by successive municipal authorities that created a great place to live. Their efforts were rewarded since world indexes ranked the place as "Most livable city in the World" several years in a row or worse, ranked it in the top five ever since. And, of course, came the hosting of the 2010 Winter Olympics. The perfect window to present the world how outstanding of a city Vancouver is and how desirable of a lifestyle it offers. 

I know this firsthand. In 2007, when we decided to leave our hometown in Quebec, these were factors that influenced our choice of a destination. We were definitely not alone.

Rental units were hard to come by then. “Already rented” was the common answer in reply to rental ads. We felt lucky when we landed the last unit of 260 in a skyscraper by English Bay Beach while two other couples were literally lining up at the door and were left looking. Lucky, even though the rent price was over three times what we used to pay back East for a similar space. The city was a garden of cranes and building sites. The hype was going full steam.

Fast forward, 2010 Winter Olympics came and went, the PR rhetoric remained. “Living in one of the best cities in the world comes at a cost” still is a building manager justification for your rent maximum allowed increase. “People know they live in one of the best cities in the world when they came” is the business HR manager catchphrase to explain your bare minimal salary increase. Basically, you are to blame for being here.

Well, it seems the motto wore off quickly since Q1 of 2011, more people are leaving the province than those who chose to settle in.

Now early 2014, a quick search on Padmapper.com suffice to realize that rental units scarcity is nowhere near a problem. Almost every single building has a unit (or several) for rent. The prices though remain stubbornly high. An exact unit we got for $975 a month in 2009 goes for $1250 nowadays. The average price in the West-End neighbourhood for a one bedroom suite (more or less 500 square foot) is set at $1300 a month.

As much as one would like to believe supply and demand dictates such markets, the current overpriced situation for units is such that landlords need not to worry about empty suites yet. The current, overpaying, tenants allow owners to delay any price reduction in hope to wave off the current exodus and skim the market (read you) of whatever fat there is left. We, the tenants, afford them to run on empty.

Tthat leaves a city that on the brinks of unsustainability. How do you end up lowering the rental prices without creating a wave of dissatisfaction from current tenants? Chances are several new tenants are “getting a deal” and being sworn to secrecy at the signing of the lease. Still they are probably paying more than what a speculative market inflated by punctual scarcity and good marketing is worth.

 Affordability was a concern back in 2007. In that perspective, things have strongly worsened since. People are flocking out now. Something, or someone, has to give… and apparently, it won't be your landlord just yet.