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Vancouver property values go up in Chinatown, Downtown Eastside, Mount Pleasant industrial — speculation maybe?

January 30th, 2014 · 17 Comments

Many thanks to Andy Yan, number-cruncher and city analyst par excellence, for this map and story. Andy scraped or whatever all the data about property assessment changes between 2014 and 2013 and put it on a map. Look really closely and you can see what happened on your block.

The map tells the tale of where the biggest property-value spikes are — hope you can get to the link, as I can reprint the copy okay but the map is kind of teeny on my site.

FRANCES BULA

VANCOUVER — Special to The Globe and Mail

Published

Last updated

A decade ago, Vancouver planning director Larry Beasley sent out a message to developers: Go east.

It appears they have, along with business owners and home buyers.

An analysis of the change in Vancouver property values between 2013 and 2014 shows assessments have risen in key spots in the east, with Chinatown, the Downtown Eastside, Main Street, Kingsway and lower Commercial Drive showing up as distinct hot spots.

Property speculation in East Vancouver: A quick guide

Values in many single-family areas in southeast and southwest Vancouver have declined as prices have dropped from a previous high.

The escalation of east-side property values is raising fears that speculators are buying land at inflated prices.

An industrial part of Mount Pleasant near Main Street and Broadway had the highest increase – about 30 per cent, as calculated by the B.C. Assessment Authority on the basis of recent sales.

“It could be a new demand for light industrial in the city. Or it could be speculation,” said Andy Yan, a planner with Bing Thom Architects who mapped the change in property values across the city.

Vancouver recently rezoned narrow strips of land on either side of lower Main Street and a prominent lot at Kingsway and Broadway to allow greater density, which likely prompted developer interest.

Mr. Yan said the city needs to move aggressively to stop speculation and preserve a part of the city that is an incubator for businesses. The area, which has about 8,000 jobs in it at companies ranging from auto-repair shops to architectural model builders, recently became home to the booming tech firm HootSuite and the brewpub 33 Acres.

“We need to not only save the offices in downtown Vancouver, but safeguard the economic nursery found in these light industrial areas that create firms that could some day fill these offices,” Mr. Yan said.

Former city planner Ray Spaxman, who has been working with communities in the Downtown Eastside and Strathcona, said the signs of price increases in those lower-income areas is worrying.

“We know there is speculation going on,” he said. “The biggest issue is the pressure from all the bulldozers that are running in the area and council policies that are focused on densification.”

He said he hopes a new city plan for the area will help reduce the speculation. The plan, on which council will vote on March 12, spells out height limits and restricts the amount of condo housing that can be built in some parts of the area.

Century 21 realtor Mike Stewart, who advertises condos in the Downtown Eastside and Chinatown on his website, said there is no doubt developers are moving into the area and paying higher prices for land as younger buyers show they are willing to live there.

“It’s been going for a few years now, but it’s reaching critical mass. The developers have run out of land in the western portions of the downtown. They’re buying up the land in the east but being quiet about it so their competitors don’t know.”

The city’s assistant planning director Kevin McNaney said the department is working hard to stop speculation by spelling out new policies that say exactly where new development will – and will not – go.

Mr. McNaney said a new city guideline removed the option for buildings that include a residential component in the Mount Pleasant industrial area.

Although likely some speculative buyers thought the land might be converted, he believes the city’s new policy for Mount Pleasant is encouraging people who want to build commercial space.

“It’s people interested in investing in and intensifying the area. It’s a very cool industrial area and one of the rare ones close to transit.”

Mr. McNaney also said the increase in values in Chinatown and the Downtown Eastside is relatively small but looks large because the prices used to be the lowest in the city.

He says the new city plans will, as in Mount Pleasant, bring clarity about what is allowed and actually reduce speculation.

“We are starting to send some signals about that.”

Categories: Uncategorized

  • Threadkiller

    “Maybe”?!?

  • Tiktaalik

    Could the main driver of increased property value in Mt Pleasant Industrial be due to the zoning rule change?

    “The zoning in the Mount Pleasant Industrial area was ‘tweaked’ a little earlier in the year. Now developers can have up to double the site area in office use, provided they build the same as the site area as industrial-type space.”

    http://changingcitybook.com/2013/12/14/380-w-5th-avenue/

  • Julia

    and the existing users/tenants of these commercial properties will get wiped off the map due to staggering increases in property taxes – and nobody cares.

  • tf

    This was a given in the DTES; everyone knew it. That’s why there was such a huge conflict over the zoning changes in Chinatown. If the changes were approved, we all knew that property values would increase, thus jeopardizing the housing of the low-income residents.
    No ifs, and or maybes – we said it then and we continue to say it now.
    Although some segments of the community oppose value increases, the folks who want it have influence and access to the decision-makers.
    Advocates for the low-income community members tried to change the imbalance of power but we have not been successful.

  • Stephen X

    The mapping is very interesting, but it also seems a bit misleading. BC Assessments are based on land and improvements and the data on the map gives no indication if the increase is a result of an improvement on the land or just the land itself. It would be interesting to see a focused sample of one affected area with all the land transactions and developments over a period of time. To get an accurate idea of how these activities affect assessed property value.

    “The escalation of east-side property values is raising fears that speculators are buying land at inflated prices.”

    It’s not great that speculators inflate prices, but I’m not sure why anyone would care if speculators buy land at inflated prices. (Maybe this would discourage the practice.) In some ways I would question how much speculation is taking place in the DTES when the city has indicated it is going to pass a new zoning for the area with significantly larger pemitted buildings and higher residential densities. The city has made it clear they want a particular form of redeveloped.

  • brilliant

    @Steven X – who do you think gets stuck paying the inflated taxes? People trying to run a business! Ever since Vision indicated spot reasoning was the law of the land its open season.

  • brilliant

    should be “spot rezoning”

  • Ned

    brilliant #6
    +1 on that Vision thing.
    BTW, I think “spot reasoning”, considering who we have to deal with, is not that far from reality either.

  • Bill Lee

    …Pete McMartin wrote last week

    ….But Yan’s 2013 maps may have shown a city whose real estate market had already reached the high tide mark.
    Last year’s assessments were taken just before the real estate market here began to soften, and talk was of a new affordability in the city — “affordability” being a relative term.
    But prices had climbed so high, and had grown so untenable except for the wealthy, that it seemed they could climb no higher.
    Would this year’s maps show that?
    Well, yes.
    And no.
    In this year’s data of assessed values, Yan found a city that had reached something like stasis.
    “It’s basically frozen,” Yan said. “The line for million-dollar assessed homes appears to be about the same as last year. Whether that continues as a long-term trend, I don’t know, because we only have two data points. But for the moment, it looks to have plateaued.”
    However, there were increases. Yan found that about 1,100 properties with assessed value under $1 million last year had climbed over the $1 million mark this year.
    He also found that the number of homes in the very upper categories of assessed value had increased. For instance, homes assessed at over $5 million increased to 785 in 2014 from 703 in 2013.
    But there were decreases, too. He found that 740 properties had fallen under the $1 million mark in assessed value in the past year — which in the superheated real estate market here constitutes a near miracle.
    Those decreases did not negate the fact that due to rezonings and the usual churn of the market, the city in 2014 was left with about 400 fewer single-family residences assessed at less than $1 million.
    But overall, Yan said, when you consider the market in its entirety, the picture that emerges is of a city in stall.
    And that, Yan said, made him wonder about the character of the city’s economy. Had we maximized the city’s real estate value in relation to the economy that supports it?
    Yan: “It made me wonder: Do we have the economy to support further rises in assessed value? This, I think, plays into some pretty hard questions about the city, and the kind of economy we are growing here.
    “If all this wealth was connected to what we were generating locally in the city in terms of an economy, I think it would make for a great deal of optimism. But the fact is, there’s a great disparity between local income and real estate prices.
    “I think, in part, it also talks about the suburbanization of the area, and how people are moving out there in greater numbers because they simply can’t afford a home in the city.”
    That shift to the suburbs is central to the future of the city’s personality. Despite what seems like the widespread disaffection with city hall sponsored densification among Vancouverites, about half of the city is still zoned single-family residential. That is a large percentage for a major metropolitan area, and serves to keep prices high, and densities low. As constant headlines in the past year have shown, city hall’s attempts to rectify those opposing extremes have been met with nothing but hostility and neighbourhood revolt across the city.
    So what Yan’s map this year may be showing — at least metaphorically, anyway — is a city on hold, which is no longer sure of its direction or purpose, of a success story enjoying its wealth but bedevilled by it, too.

    Read more: vancouversun.com/business/Pete+McMartin+Andy+million+dollar+Vancouver+2014+edition/9428131/story.html
    Andy Yan’s 2014 map of assessed property values in Vancouver shows a city on hold.
    http://www.vancouversun.com/business/cms/binary/9428236.jpg?size=620x400s

  • A Dave

    StephenX, to clarify how assessments are made, it states at the top of the assessment notice: “”For most properties, the value is based on real estate sales and market conditions in your area.”

    “As constant headlines in the past year have shown, city hall’s attempts to rectify those opposing extremes have been met with nothing but hostility and neighbourhood revolt across the city.” – McMartin

    Ad nauseum, I will point out that this really isn’t true at all, catchy tweets and lazy headlines notwithstanding.

    Neighbourhoods like Mt. Pleasant or Grandview-Woodlands accept intensification and the need to accommodate growth. It is reflected in the parts of the MP Community Plan that were vetted publicly, like the widespread consensus that 6-8 storeys were acceptable and in keeping with the character of the neighbourhood. This represents, in most areas, about a 100% INCREASE in the amount of allowable density. Surely, Mt. Pleasant doesn’t need more than this to accommodate growth in the next 50 years, does it? And go take a look at all the 6-8 storey developments built in the area in the last decade. Did you ever hear on ONE protest? Nope.

    Heck, 80% of the respondants during the open houses SUPPORTED the Rize at 10-12 storeys. There was no small group of loudmouths highjacking the process and pretending to speak for the majority (RAMP didn’t even exist then), as certain people would like you to believe.

    In fact, there were hundreds of respondents and they all had remarkably similar tolerance for certain heights or densities. And, lo and behold, these matched almost exactly what 3 years of public consultation leading up to the Community Plan had already shown.

    As per tf’s comment at #4, the only people who seemed surprised by the backlash to the Rize were Council and the press, apparently because neither took the time to look at the Community Plan, other than the parts with loopholes embedded in them by City staff after the public consultation was complete (ie. tacked on provisions for “special sites”, which were never transparently vetted during the consultation phase).

    The neighbourhoods are not revolting against incremental growth and rational increases in density. They are revolting against ridiculous and unjustified FSR, height, density increases that are more than 100% greater than zoning, and in cases like the Rize, proposals that go 500-600% over zoning.

    At these absurd levels, the validity of justifications for increasing density become irrelevant. The only motive is profit and maximizing CACs.

  • Julia

    #10, I call that bait and switch. Folks in the West End should be equally concerned about those embedded loopholes.

  • tedeastside

    real-estate speculation, it’s vancouver’s religion

  • Tessa

    What’s going on in the industrial area around Clark Drive and north of Hastings? Does anyone know? The rest there seems almost expected, but that really jumped out at me.

  • mytwobits

    Stephen @5

    the reason it should be a concern that speculators buy at excessive prices is because then the only way they make their money back (or a profit) is to develop towers. often against the neighbourhood’s wishes, but perhaps with the tacit support of council, which is why they would take the risk and overpay for the land.

    case in point. the $30+ million paid for the old Canadian Tire site at Kingsway & Gladstone. Guess what’s going up there now? Three 14-storey towers.

  • jenables

    Am i crazy or does Victoria turn into nanaimo on that map…and nanaimo is west of Victoria?

  • Bill Lee

    Of course the closely held Chinatown landholdings
    of the family Tongs / Clans doesn’t help.

    Nor does Bob Rennie’s 50 metre nasty black
    monolith, boiler room phone banks, “Aht Gallery”
    and apartments in the Unit Block East Pender help
    things in Vancouver.

    The slow decline of American Chinatowns
     By Aidan Lewis BBC News, New York
    4 February 2014 Last updated at 16:05 ET bbc.co.uk/news/magazine-25920980

    [ Later titled “The changing face of New York’s Chinatown” 5 February 2014 Last updated at 16:29 GMT
    at : bbc.co.uk/news/magazine-25988146 as a video feature ]

    “Chinatowns are a feature of many US cities, but some of the best known are succumbing to gentrification, campaigners say. Even one of the largest and most vibrant, in Manhattan, is slowly being invaded by luxury shops and apartment buildings.

    It’s late afternoon and Mei Rong Song is serving a few last customers in Lao San Snack on East Broadway. Giant metal pots steam behind a counter stacked with metal trays of pig’s blood, heart and intestines.

    Mei has run her restaurant for a decade, catering to a wave of immigrants who began arriving in the 1980s from Fuzhou in south-eastern China….

    ….Chinatowns are turning into a sanitised ethnic playground for the rich to satisfy their exotic appetite for a dim sum and fortune cookie fix,” says Andrew Leong, one of the authors of a recent report that charted gentrification in New York, Boston and Philadelphia’s Chinatowns.

    Washington DC’s version is little more than a collection of Chinese restaurants, gift shops and an ornate arch.

    [ Report : http://aaldef.org/Chinatown%20Then%20and%20Now%20AALDEF.pdf
    Asian America Legal Defense and Education Fund
    “Gentrification in Boston, New York and Philadelpha”
    45 pages ]

    But high rents have been pushing Chinese immigrants out of the area, their place taken by wealthier white tenants.

    ….
    The process is less advanced in New York, says Andrew Leong. But even there high-end stores, non-Asian restaurants and luxury apartment buildings have been spreading.

    [ See map of Mott Street and area in New York with
    Luxury vs Tenements marked, at the phrase”

    “The process is less advanced in New York, says Andrew Leong. But even there high-end stores, non-Asian restaurants and luxury apartment buildings have been spreading.” [ MORE ]

  • Kenji

    There must be a way to square the circle here.

    The objectives of creating new buildings which can house more people (and fewer rats and cockroaches) does not necessitate obliging the entire existing neighbourhood of poor people to move.

    If a city adopts a humane housing objective – let’s say 20% social housing in a given area – then maybe they get the existing people into that 20% of subsidized suites and open the rest up to the yuppie scum.

    The previous character of a neighborhood is neither here nor there to me.

    Neighborhoods change. Today’s forcible displacement is yesterday’s urban decay.

    While I am against homogenous architecture, preserving a neighbourhood in and of itself seems to me to be very strange social engineering.

    If we’re being honest, a Chinatown’s historical reality would also include opium dens, human trafficking, rape, etc. We didn’t preserve any of that, or I hope we didn’t.

    Frankly I’m more interested in the future since that is where my kids will live.