The empty condo mystery decoded
Is Vancouver harbouring hundreds or thousands of empty condominiums that could help solve the city’s rental shortage? Many believed so last fall and Mayor Gregor Robertson mused about taxing the empty units to bring them into service.
But do they exist? The debate sparked the realization at Bing Thom Architects that little is known about Vancouver’s condo inventory once it is sold. Firm associates Andy Yan and Eileen Keenan decided to find out more, using the resources of BTAWorks, the firm’s research foundation.
What constitutes an empty condo? Using BC Hydro expertise, Yan and Keenan used energy consumption as a proxy, looking for units where monthly consumption was below what would be expected for an energy-efficient fridge. But they went much further than that, combing through city records, BC Assessment Authority data and the strata council minutes of 12 buildings with 2400 units that formed the study sample.
Thousands of empty units? Not really. Between January 2006 and January 2007, the vacancy rate in the study sample was about 5.5 percent, consistent with the the high turnover Yan and Keenan found in this housing stock. Other interesting findings:
- between 52 and 61 percent of the units are not owner-occupied, depending on the building, meaning condo units make up a significant share of the rental market;
- foreign ownership is less than 10 percent of the stock in the sample, although Yan warns this finding is not conclusive;
- rental restrictions are effective in raising the share of owner-occupied units, but one tower without restrictions provides vital rental units to foreign students living in the downtown core; and
- smaller units, which meet a minimum standard for affordability for a typical couple with one child, are too small for a growing family, which the CMHC says needs two bedrooms.
As a result, Yan says, we can conclude that the condo market is generating “growth, but not development.” The units that are affordable for new families — a doorway to home ownership — are too small for family life.
In other words, Yan told the VEDC group, “high density does not lead to [social] sustainability or affordability in urban housing.”