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Victoria rental housing market and related issues discussion


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#1481 Victoria Watcher

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Posted 10 August 2022 - 03:40 AM

Government should take an equity stake

 

 

Re: “Catherine Street rental-housing project gets green light despite concerns,” Aug. 5.

 

I don’t have a strong opinion about the specific pros and cons of the rental development on Catherine Street. However, one sentence in the report caught my eye.

 

“When the project starts will depend on government financing, as doing a rental project with a traditional lender is not feasible at current rates.”

 

It is taken as a fact that governments have to finance this project, either from existing revenue or by borrowing at market rates, then subsidizing projects at less-than-market rates.

 

If taxpayers are funding new rental projects, governments should ask for equity stakes in those projects.

 

It makes no sense to invest in new rental housing for zero equity, then to talk about contributing millions more to a special fund, so governments (or their agencies) can purchase existing rental properties and provide homes at less-than-market rents.

 

It is a good idea for governments to become owners of rental property for their citizens — or part owners, in deals with commercial companies.

 

Why shouldn’t that ownership begin with an equity stake for every dollar invested to finance construction of new rental projects?

 

 

George Jamieson
Victoria

 

 

 

https://www.timescol...s-money-5679437


Edited by Victoria Watcher, 10 August 2022 - 03:40 AM.


#1482 spanky123

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Posted 10 August 2022 - 04:55 AM

^ The much larger issue is buildings that are subsidized for lower income tenants which then never provide lower income rentals or do so at the nebulous “10% below market” which somehow is still more expensive than anything else nearby!

#1483 Mike K.

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Posted 10 August 2022 - 04:59 AM

New stuff is going to be expensive, certainly more than old stuff. I can imagine a 2022-build affordable rental will land higher per square foot than the 1970s block next door.

 

I mean the entry level, brand new Chevy sedan is still more expensive than a 1995 Cadillac, right?


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#1484 spanky123

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Posted 10 August 2022 - 05:15 AM

^ Then what is the point of providing millions of dollars a year to subsidize housing for the poor if the people who wind up being subsidized are the wealthy who can afford the new units? Is there evidence that middle income people move up and free up their space or do newcomers just come into the market and outbid them on the new developments anyways?!

#1485 Mike K.

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Posted 10 August 2022 - 05:29 AM

It theoretically leads to upwards mobility, freeing up the older, less costlier units for those who can’t afford the brand new below-market units.

The suppliers of housing can’t control who gets it, and mobility is a freedom enjoyed by Canadians.

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#1486 Mike K.

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Posted 10 August 2022 - 05:33 AM

I also expect developers who operate below market units in market buildings to be transparent about their intake process. I don’t think there are any shenanigans going on and below market units are tethered to income maximums.

In any case, building more rentals and feeling good about that is not a long term solution. More homeownership should be council’s goal, not perpetual renting.

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#1487 Citified.ca

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Posted 10 August 2022 - 08:36 AM

How much longer are Victoria renters spending in rental housing due to high homeownership costs?

 
How many purpose-built rental units are actually vacant in Victoria's rental market?
 
How are inflation rates and interest rates impacting the rental market?
 
Those questions, and more, are discussed in this month's Ten on the 10th Q&A segment, featuring Devon Properties' new COO Renee St. Germaine.
 
Q&A on Victoria's rental housing market with Devon Properties COO Renee St. Germaine

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#1488 spanky123

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Posted 10 August 2022 - 01:15 PM

I also expect developers who operate below market units in market buildings to be transparent about their intake process. I don’t think there are any shenanigans going on and below market units are tethered to income maximums.

In any case, building more rentals and feeling good about that is not a long term solution. More homeownership should be council’s goal, not perpetual renting.

 

And that is the $64K question. Is there a way of checking which developers are honouring their agreements and which are not? Does everything just fall into a 3rd party housing administrator black hole?


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#1489 spanky123

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Posted 10 August 2022 - 01:19 PM

How much longer are Victoria renters spending in rental housing due to high homeownership costs?

 

I would think that the single biggest reason why renters are staying in their rentals longer is rent controls. If your rent is locked in forever at what is turning out to be a maximum of 1%-2% annual increases then you are in no rush to ever move up or out!


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#1490 Mike K.

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Posted 10 August 2022 - 01:37 PM

There’s that, absolutely, but the bigger motivator would still be homeownership no matter how good your rent might be (for the overwhelming majority who can make the switch, I mean).

Based on Renee St. Germaine’s info, renters are now phasing out at 35-38 years of age, after starting in their early 20s. A decade-plus ago it was 32-35 for the phaseout.

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