- But there’s one enormous cloud looming on the horizon — housing affordability. It’s no secret that Vancouver housing is increasingly unaffordable. (The same goes for Toronto, to a slightly lesser extent.) In a recent report Vancouver was listed as the third least affordable city in the world to buy a home, more costly than New York or London.
Interesting piece by the CEO of Hootsuite. Finding an affordable place that isn't more than an hour away from downtown is a pain in the ass. We got very lucky with our current place which places us about 40ish minutes away, up from an hour and a half at our old place. Of course, we're just renting, and owning any piece of property sometimes seems as much of a pipe dream as winning the lottery.
Portland Oregon is heading the same direction. My house has gone up more than 20% in value in two years, rents are going up faster than that. On the upside maybe someday soon I'll see more customers an hour on a nice summer day than I'll see guys with no shirt on.
I'm much more familiar with Vancouver 15 years ago than I am with Vancouver now, but at the time the market was being inflated by the externalities of Hong Kong's reabsorption. I would suspect that Vancouver has a lot of the same Chinese mad money that San Fran and Los Angeles have, where you've got Chinese rich shipping money off shore into investments that are protected from the vagueries of a command economy. But I don't think it'll deflate as quickly as it inflated. Vancouver has the same geographical issues as San Francisco - it's on a spit, bounded by water, with limited access points. There will always be heightened demand for locations in close. You'll lose the drive for multi-family, by the way. San Francisco lost. Seattle lost. And both of these are so much worse than Vancouver. You drive into Vancouver from the south and it's a gleaming bauble of tinted curtainwall. You drive into San Francisco and it's still row houses. And it could be argued that the high salaries of internet startups that don't actually produce value are contributing to the problem. If Hootsuite had to pay its employees what it can earn from its services, rather than what it can gain from ridiculous overvalued IPOs, outfits like Hootsuite might not be driving $2000/mo 1br condos in the downtown core.
I wish we had we had the high salaries of places like NY and SF to go along with the high cost real estate. Even Hootsuite's salaries are half of what you could earn in SF AND in Canadian dollars instead of USD.And it could be argued that the high salaries of internet startups that don't actually produce value are contributing to the problem. If Hootsuite had to pay its employees what it can earn from its services, rather than what it can gain from ridiculous overvalued IPOs, outfits like Hootsuite might not be driving $2000/mo 1br condos in the downtown core.
Yeah, we had many conversations at the company I interned at last year about what their goal was. We're convinced that they have some sort of secret project they're working on, because no one we talked to at Hootsuite could tell us why they were hiring so many people.
The Chinese money suspicion is an absolute fact. As an anecdote, my cousin-in-law's off-shore family has bought at least a dozen multi-million dollar homes that I know of that they may have visited once. At least they pay for the up-keep though as many do not. The same day you posted about the Venice house I read this article about a Chinese couple that bought 2 houses for $10 million in 2010, have never even visited and they are just sitting rotting. Apparently about 15% of condos are sitting empty as well. And then there is the seperate issue of people buying newly renovated properties for $6 mill and demolishing them. That is my Uncle's old house and is beautiful as is.
Kind of baffling, isn't it? Makes you wonder just how much money they have to throw away. Whether they get to write off the depreciation on a home for letting it crumble into the dirt. Friend of mine lives up by the Hollywood sign. His is the white one on the right. In 2012 Ashton Kutcher moved in and knocked over whatever was there and build a pleasure palace. In 2014 he moved out. In 2015, the new owner tore it down and built something bigger. Think he was a producer on Hurt Locker.
Huh! As a Calgarian, I guess I never saw this side of the coin. I've been watching a lot of skilled tech workers jump ship to Vancouver these past few months, and didn't really make the connection that they were likely already reasonably wealthy enough to do that. My roommate and I are renegotiating our rent soon, but we really like our landlords - makes it tough to justify cutting costs for yourself when you know one of them just got laid off. Wonder if the slowdown will continue to just be a slow descent, or if there'll be something bursting soon.
Portland is running into similar issues as well., which is really just spillover from San Fran, in my opinion.