Small-space residency has a big history

February 10, 2010 — Danson

Size does indeed matter. Just ask the Surrey homeowners troubled by the 4,000-plus-square-foot home overshadowing their rancher. Or the folks who can’t wait to move into a 270-square-foot rental in East Vancouver.

The former is viewed by municipalities, proponents and opponents as a rather prickly issue that is not easily resolved. The latter has generated much to-and-fro discussion ever since a developer issued a news release heralding his 30 micro-suites as “the smallest self-contained rental apartments in Vancouver.”

The new boys on the Burns Block in the Downtown Eastside are anything but newbies.

The developer, Reliance Properties, is a privately owned Vancouver company with more than 50 years experience in Vancouver’s real estate market. In the past decade, Reliance has built about 300 rental lofts in Gastown and the Downtown Eastside, and has won several heritage awards.

Reliance’s project partner, ITC Construction Group, is the largest residential construction company in Western Canada and has completed 115 projects in B.C. and Alberta. ITC has been selected as one of Canada’s best-managed companies for six straight years, and is committed to corporate social responsibility.

Not a bad partnership handling the makeover of a 100-year-old, five-storey, 18,000-square-foot building. As a former board member of the Vancouver Heritage Foundation, I can tell you the once-abandoned structure promises to be a polished heritage jewel when work is completed next year.

The suites will offer a space-saving wall bed with built-in, flip-down dining table. The kitchen will include a bar-size fridge, two-burner cooktop, sink, convection microwave, countertop and cabinets. The bathroom will have a shower, sink and wall-hung toilet. A computer work area will have space for a wall-mounted TV. A large window will take up almost the entire space on the exterior wall.

Monthly rents will be as low as $675, reasonable in a city just pegged by a public-policy research group as the most unaffordable in the world. (The group’s assumptions and conclusions are considered somewhat flawed by some industry watchers, but that’s a story for another day.)

Despite the need for more affordable housing in this region, the project has its detractors. As soon as media outlets posted the story on their websites, comments from the public quickly followed.

One fellow wrote that living in such a small apartment would be akin to occupying a prison cell. Perhaps he has claustrophobia issues but, for the record, the average prison cell built today is a cosy 70 square feet. Another guy said he wouldn’t last more than a few months in a 270-squarefoot apartment.

Here’s the thing. The Burns Block concept is not new, far from it. So all this naysayer chattering about some newfangled housing form coming soon to Lotus Land-by-the-Sea is a tad bothersome.

Tiny homes exist all over the world, and the folks who live in them are quite happy and content.

Take, for example, Californian Jay Shafer, who for more than 10 years has lived in a 96-square-foot home complete with galley kitchen, bathroom with shower, seating, desk, bookshelves, closets and fireplace. The home is easy to heat and cool, and meets California’s strict energy-efficiency standards. I don’t know Shafer’s significant-other status, but his sleeping loft accommodates a double bed.

New York is home to the Prokops and their two cats. Compared to Shafer’s home, the Prokops’ Manhattan coop apartment is mansion-like at 175 square feet. They have given new meaning to the term “downsizing”, starting out with a 1,600-square-foot apartment, then 900, now 175. The married couple plan to renovate their home this year, a process that likely won’t break the bank or take much time.

Worldwide, the story is the same. Los Angeles is home to a growing number of small-unit condos and apartments, including the Rosslyn Lofts in the historic downtown. The 297 rental apartments range in size from 200 to 325 square feet. The homes add to the variety of mixed-income housing, which helps to attract a diverse group of tenants, enhancing the vitality and diversity of the downtown area.

Small is also big in Santa Monica, where space-efficient 375-square-foot apartments in a central location close to amenities are popular with renters. And in Edinburgh, Scotland, renters are flocking to 350-square-foot contemporary concrete-and-steel apartments, complete with balconies overlooking green space.

In Toronto, the city’s smallest detached home, built in 1912, is only 330 square feet. It even has a backyard.

In 1990, Gordon Price lived for a month in a 290-squarefoot apartment at Drake and Seymour in downtown Vancouver because he wanted to see if such a small space was livable. Turns out it was.

“The apartment was absolutely livable for me. If the space is designed and proportioned to both day and night uses, it will be perfectly fine for all functions. In my case, the apartment’s Murphy bed tilted up in the morning, replaced by a dining room table for the rest of the day,” said Price, a former Vancouver city councillor and now the director of the Simon Fraser University City Program.

“It is important the apartment remains uncluttered, and the furniture is appropriately designed for the space. And you need lots of natural light, preferably from a floor-to-ceiling window,” said Price.

“People who live in small spaces typically spend more time in the public realm -making use of parks and other amenities, eating in restaurants, that sort of thing. Because they spend so much time away from their apartments, it is important that their neighbourhood is clean, green and safe,” said Price.

Tom Durning of the Tenant Resource and Advisory Centre is always happy to see an increase in the production of affordable rental units, particularly in Vancouver, where supply is tight and costs high.

Durning was quoted recently in this paper as saying, “Any rental housing is good housing these days.”

Many groups — including housing advocates, developers and governments — will be watching to see how the Burns Block project fleshes out. So far, I believe all can agree it’s not a bad experiment.

- – -

A few young people have called our office to ask when the Greater Vancouver Home Builders’ Association’s annual first-time homebuyer seminar will be held. Well, save the date, the seminar will be held from 7 p.m. to 9 p.m. on Tuesday, March 23 at the Vancouver Sheraton Guildford Hotel in Surrey.

Presenting sponsor of this year’s seminar will be the Homeowner Protection Office, the provincial Crown corporation responsible for builder licensing and the provision of home warranty insurance.

Corporate sponsors include The Vancouver Sun, the Province, Canada Mortgage and Housing Corp., TD Canada Trust, Real Estate Board of Greater Vancouver, Travelers Guarantee, Genworth Financial, Shaw Cablesystems, CKNW AM 980, Classic Rock 101, AM 730 and 99.3 The Fox.

Visit www.gvhba.org for registration details. More than 900 registered for last year’s seminar.

Peter Simpson is the chief executive officer of the Greater Vancouver Home Builders’ Association. E-mail peter@gvhba.org.


By Peter Simpson, Special to the Sun

February 6, 2010
© Copyright (c) The Vancouver Sun

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Vancouver Real Estate Sales Surge Ahead Of Winter Olympics

February 10, 2010 — Danson

By Kevin Brass
Editor, International Property Journal

When the Olympic flame enters BC Place Stadium on Feb. 12, the world’s spotlight will fall on one of North America’s hottest property markets.

In November more than 7,721 properties were sold in British Columbia, the highest volume for the month since 2005, according to the British Columbia Real Estate Association. And it wasn’t spurred by foreclosures and short sales; the Real Estate Board of Greater Vancouver’s housing price index for the area jumped 16.2 percent to $562,463, from a year earlier.

“We’ve seen a dramatic rebound in home sales,” said Cameron Muir, chief economist for the BCREA. Home prices have been on an uptrend for several months, “scratching record levels,” Muir says.
A few weeks ago, in a throwback to the old days, 20 buyers camped out over night in the cold to buy units in a Vancouver development called the Mark, a tower in the trendy neighborhood of Yaletown. In one day 163 of the 214 available condos sold, with units ranging from 460- to 730-square-feet priced between $320,900 and $660,900. (All figures in Canadian dollars; the current exchange rate is $1USD=$1.03CAD.)

International buyers are playing a “very significant” role in the upturn, according to Ross McCredie, president of Sotheby’s International Realty Canada. “Over half of the homes sold over $5 million in Vancouver sold to mainland Chinese,” he said. In West Vancouver, known as Vancouver’s most expensive neighborhood, there has been consistent activity from Middle Eastern and U.K. buyers, he says.

The bulk of the international buyers are making a lifestyle purchase more than a simple investment, taking advantage of Vancouver’s reputation as one of the world’s most livable cities, McCredie says. “They are not necessarily retirees, they’re just looking for a change,” McCredie said.

A few years ago 25 percent of condo buyers in Metro Vancouver were considered investors, according to tracking data by LandCor. Last year the number was closer to 8 percent.

“Speculators have never understood this market,” McCredie said.

The upcoming Olympic Games, local experts agree, has little to do with the recent surge. Low interest rates and pent up demand fueled sales, they say. Vancouver’s natural shortage of developable space also serves to artificially inflate prices, keeping Vancouver among Canada’s most expensive cities, even in down times.

Last year, prospective buyers held off buying, but jumped backed in as soon as the market started stabilizing, creating the recent flurry of activity, said Robyn Adamache, senior market analyst, Canadian Mortgage and Housing Corp.

Even for Vancouver, recovery in the property market has been much quicker than in past cycles, Adamache says. The regional unemployment rate is still relatively high at 7 percent, she notes. “It’s not the economy that has picked up so quickly,” she says.

But Vancouver’s property market is not dependent on locals. The region attracts a net migration of new residents of about 40,000 people a year—most of them from outside Canada, according to Canadian Mortgage and Housing data. China, Taiwan and India are the largest contributors, data shows.

In contrast, the number of U.S. buyers has slowed in the last year. Californians, in particular, are still struggling with the ripple effects of the housing crisis, industry executives say. But a pickup in buyers from Asia has more than compensated for the U.S. drop-off, Vancouver executives say.

Some compare the surge in Chinese buyers to the huge flow of money from Hong Kong in the ‘90s.

“We’ve seen a huge influx of buyers from mainland China,” said Dave Watt, a Realtor with Royal LePage and past president of the Real Estate Board of Greater Vancouver.

Most are doing business in the area or sending their children to school, and they’re buying in the $1 million to $3 million range, he says. In December, the Chinese government gave Canada “approved destination” status, which should increase the connection, Watt notes.

Outside Vancouver, British Columbia is a patchwork of different markets. Victoria is known as a retirement community, with a sunnier climate and year-round golf. Kelowna is a region of lakes, mountains and picturesque vineyards. Whistler is a classic upscale ski resort, known around the world.

In the last few months, the second home markets, in particular, have seen a jump in activity, analysts say, after a long slow period.

“The recession hit us worse than everybody else,” said Ursula Morel of Sea to Sky Premier Properties in Whistler and the 2010 president of the Canadian chapter of FIABCI, the International Real Estate Federation. “The higher the prices, the more you go down.” Most of the activity in the first half of 2009 involved fractionals, she says.

However, in the second half of 2009, Whistler sales picked up again, with 11 sales between $2 million and $3 million. “It’s not Olympics driven, but there is definitely more hype in the air,” said Morel, who puts “Home of the 2010 Olympics” in the subject line of all her e-mails.

Foreign buyers in Canada are typically required to put 25 percent down, which has helped provide a level of stability to many markets, with few debt-to-equity problems and little urgency to sell, Morel said.

Clearly buyers believe there are no more steep drops in the Vancouver area’s near future. In Vancouver a property recently sold for more than $10 million and two in Victoria sold for more than $6 million.

Vancouver is expected to see price increases of four to seven percent, according to local analysts. Royal LePage predicts a 7.2 percent jump in the next year.

“Everything is pretty hot right now,” said Pete Shpak, managing broker for Sea and Sky Properties’ West Vancouver office. “I’ve been in a few multiple offer situations, which wasn’t happening a year ago.”

But there is still an air of caution. Many believe the recent surge only reflects the pent up demand and once that dissipates sales volumes could slow. A jump in interest rates could also put a wrench in the recovery.

“The high end is still softer than it has been in past years, and that is largely the result of the economy crawling slowly out of recession,” said Muir of the BCREA.

But then there’s the wild card—the Olympics, sure to supply a non-stop, two-week stream of soaring images of Vancouver’s spectacular coastline and picturesque mountains. In many ways, it will be one long advertisement for the region.

“I think it’s going to be pretty amazing how many new eyes see us,” Watt said.

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