John Roston on Housing

Historical contect from 2015 to 2022.

Large housing developments are building strata condos for investors rather than rental housing for young people and families.

The Problem

There is an acute shortage of market rental housing units in Richmond's City Centre near public transit and Council only makes token efforts to do something about it. Young people brought up in Richmond can’t afford to live here. Neither can many first responders, hospital staff and City employees providing essential services.

Only 26% of Richmond’s housing units are rentals compared to Vancouver where it's 53%. The historically ultra low vacancy rate of 0.5% increased to 2% in 2020, but average rent still increased 5% despite BC Government Covid rent controls. [Source: CMHC]

Although developers will make the most profit from selling condos to investors, they can also make a decent profit from purpose-built rental buildings by selling them to pension plans that want a long-term steady return from rents rather than a quick buck.

The Solution

The BC Government gave the City the power to zone particular buildings for rental tenure only precisely because it recognized that property developers can make large profits faster by selling strata condo units to investors, who often leave them vacant while waiting to profit from a rapid rise in land value. Rental zoning stops the rise in land value compared to land zoned for condos for sale.

Richmond City Council should zone majoor new housing developments like Polygon Talisman Park and Lansdowne Centre for 65% market rental, 10% below market rental and a maximum of 25% strata condos for sale.

Lowering Rents

Large developments of purpose-built rental housing under central management result in economies of scale that reduce operating costs and keep rents down while providing a reasonable profit to the owners. An individual condo owner renting out one condo has much higher costs and must charge higher rents.