DPB Hearing for 58 West Hastings: Elvin’s speech

The Word is No – Comments on the Development Permit Application for 58 West Hastings Street

Elvin Wyly

Chair, Urban Studies Program
Department of Geography
University of British Columbia

June 23, 2008

Honorable Chair and Members of the Development Permit Board, thank you for the opportunity to comment on this application.  My name is Elvin Wyly.  I’m an Associate Professor of Geography and Urban Studies at UBC.  I study housing and neighborhood change.

The staff report on this application is a fascinating document.  In response to the overwhelming low-income community opposition in the written comments, the staff report observes that “Many of the issues raised relate to issues broader than this particular development application,”[1] and “staff note that there is no obligation on any individual developer to provide non-market housing.”[2] The implication is that we should evaluate this application on its own merits, in isolation.  And yet many pages in the staff report are devoted to a careful, selective reading of the evidence to argue that this application is entirely consistent with existing policies on 1:1 replacement and development mix.  We are also told that “Affordability continues to be an issue faced by many Vancouver residents, both renters and owners,”[3] and that addressing the affordability crisis must include “the addition of housing stock.  Price is a function of supply and demand and restructuring supply of housing when there is an increase in demand will result in an increase in prices.  Restricting supply only exacerbates affordability.”[4]

So Milton Friedman has come to haunt 58 West Hastings, and to promote a fundamentally flawed theory of urban housing markets.  As you consider this application, take note of two serious contradictions.

First, added supply is not easing affordability.  Quite the opposite.  Among the many different housing types monitored by Royal LePage, the fastest Vancouver price increases over the last five years have been in those housing types where supply has increased the fastest:  prices rose 143 percent between 2002 and 2007 for standard condos on the east side, 138 percent for eastside luxury condos, and 128 percent for westside standard condos.[5] Increasing supply drove prices higher rather than easing affordability.  This is easy to understand if we remember that housing is not just supply and demand for people who need a place to live, but supply and demand for those who are mainly interested in capital gains.

Second, affordability may indeed be an issue faced by many Vancouver residents, both renters and owners.  But by definition, affordability matters most for those who cannot afford.  Owners at least have security of tenure and a chance for capital gains.  Renters, especially low-income renters, have neither.  The Downtown Eastside is primarily a low-income community, and a community of renters.  Renters, at least for now, still outnumber owners by nearly ten to one in this census tract, and four-fifths of the households are single-person households; their median income is only a little more than ten thousand dollars a year.[6] The possibility that some of the units in this development will be “mid-market” rentals is used to suggest that this project will ease affordability.  But the only way to meet the definition of affordability for the median resident of this neighborhood is to provide units renting for no more than $258 per month.  Adding market-rate condominiums to this neighborhood will not ease affordability problems.

And we should not forget that anyone who buys land or housing in this kind of neighborhood has no interest in affordability.  For the low-income renter, high prices present true hardship.  For the owner, rising prices are called capital gain.  With no trace of irony, owners routinely talk about “equity.”  The last thing they want is to see those prices reduced to “affordable” levels.

The Downtown Eastside is in the eye of Hurricane Condominia.  The levees are about to break.  The region’s last concentration of truly affordable housing is at risk.  The affordability crisis is multidimensional, and we do need the many long-term solutions described in the staff report.  But approval of this application is not what we need.  We need social housing, and we need a pause to allow a genuine community vision that respects the low-income residents.  We also need what the staff promises for later this year — the development of what are called “rate of change management tools.”  That’s a mouthful — seven syllables.  The most powerful rate of change management tool has just one syllable, and it can be used right now.  It is pronounced like this:  No.

[1] City of Vancouver, Community Services Group (2008).  Development Permit Staff Committee Report, 58 West Hastings Street (Complete Application), DE411789.  May 21.  Vancouver:  City of Vancouver, p. 11.

[2] City of Vancouver, Committee Report, p. 9.

[3] City of Vancouver, Committee Report, p. 13.

[4] City of Vancouver, Committee Report, p. 13.

[5] Royal LePage (2008).  House Pricing Historical Database.  Don Mills, ON:  Royal LePage Real Estate Services.  www.royallepage.ca, last accessed June 23.  Figures and comparisons refer to October 2002 and October 2007 prices for standard condominium apartment, luxury condominium, detached bungalow, standard two-storey, executive detached two-storey, senior executive, and standard townhouse.

[6] Statistics Canada (2008).  Census Tract Profile, 2006 Census.  Tract 59.06.  Ottawa:  Statistics Canada.  www.statcan.ca, last accessed June 23.