My Annual Vancouver Sun Forecast 2024
That said, here are observations from past forecasts and what to expect in 2025.
Car share and parking
In 2012, I noted that with the success of Car2Go, Modo and Zipcar, more people discovered car-sharing to be a convenient and cost-effective way to get around. At the same time, there were growing concerns about traffic congestion, pollution, climate change and unaffordable housing. I therefore proposed that minimum parking requirements should become maximum requirements.
What I did not expect was that these car share programs would not survive. Nor did I predict that a decade later, a provincial government would tell municipalities they could not impose any parking requirements for new multiplex developments or those near transit.
In 2025, I expect new projects will have reduced parking. Some developers will tell residents they can park on the street. However, existing neighbourhood residents will vociferously complain about the reduced availability of street parking.
While I hope this does not lead to the paving of front yards, which happened in some Toronto neighbourhoods, I do expect the municipalities to put in place more pay parking on residential streets.
Rental apartments
In recent years, municipalities have successfully encouraged new purpose-built rental housing developments comprising market and below-market apartments.
As they are completed, landlords may discover some market suites are difficult to lease at required rent levels and leave them vacant until their desired rents can be achieved.
While this could have the positive effect of bringing down rents, a negative result will be that new projects do not proceed.
To address this, the provincial government might consider copying the policy in Ontario, where, since November 2018, new rental buildings have been exempted from rent controls. While the jury is out on how effective this has been, there is no disagreement that the policy has allowed many new rental buildings to be built, and fewer suites left vacant.
Fee-simple row housing
Whenever I give a talk or write about housing choices, many tell me they are ready to move out of their single-family house but are not yet ready for a condominium.
They prefer to decide when to replace the roof or choose the colour of their front door. They also do not want to deal with a strata council that may be headed by someone who had hoped to become prime minister of Canada but had to settle for strata president.
Since 1999, I have annually advocated for the development of “fee-simple” individually owned row houses that are not part of a condominium. In each year-end column I have predicted that they would become as popular in Vancouver as in Toronto. I have always been wrong.
One reason is that developers will not build them here because municipal regulations conspire against them. These row houses require subdivisions that take time and money. Also, unlike Toronto, municipal engineers demand individual sewer and water hookups for each dwelling, which is costly. Development Cost Levies are also a problem since they are often the same as for a large single-family house.
I would like to predict that in 2025, B.C. municipalities will finally change their regulations to facilitate this type of housing, especially since it fits well with the intent of Bill 44, the multiplex legislation.
Bitcoin is up; condos are down
As I was preparing this article, I received a blog from Brandon Donnelly, a Toronto blogger who I read daily. He observed that many are rushing to buy bitcoin at unprecedented prices, but few are buying Toronto presale condominiums due to the soft market.
The situation in Vancouver is not that different.
In 2025, presale programs will get underway for new condominium projects throughout the region. Smart developers will be designing these projects to appeal primarily to “end-users” rather than investors.
Given the state of our condominium market, I expect developers will offer the initial units for sale at reduced prices to build momentum for the sales program. This could result in good buying opportunities for those ready to move into a condominium and in a position to wait for their home to be completed.
Recently, Vancouver City Council approved a motion by Mayor Ken Sim to invest in bitcoin and allow bitcoin to be used for municipal payments. I will leave it to others to comment on this.
Price impacts of Bills 44 and 47
Bill 44 allows multiplex homes on every single-family lot throughout the province in communities with a population greater than 5,000. Bill 47 allows greater building heights and densities on properties, depending on whether they are within 200 metres, 400 m or 800 m of a transit station or bus loop.
Last year I observed there was considerable uncertainty around how this provincial legislation might impact housing markets. The key reason was that few projects would proceed if municipal engineers determined sewer and water infrastructure was inadequate.
In recent years, municipalities have demanded that developers fund infrastructure upgrades through a combination of Community Amenity Contributions and Development Cost Levies and engineering fees. Developers then passed on these costs to homebuyers or renters.
However, given higher construction costs, it is increasingly difficult to pass these costs onto consumers. Consequently, tens of thousands of housing units have been approved, but stalled, since they cannot be financed.
This is not just a local problem. A similar problem exists in Ontario where municipalities are beginning to reduce fees so that projects can proceed. They realize that if new housing prices increase, existing housing prices also increase. A rising tide lifts all boats.
In 2025, the province and municipalities need to rethink how best to finance growth. Rather than expect developers or new homebuyers and renters to fund new infrastructure, costs must be shared more broadly through property taxes that are paid over time.
Property taxes
Some of us have been questioning whether the additional development rights offered by bills 44 and 47 will result in higher property assessments and taxes.
So far, the consensus is that Bill 44 will not likely increase assessments, except for larger lots in locations where there has been sales activity at higher prices.
However, single-family lots close to transit stations or where zoning changes allow greater building heights and densities could increase in value. This happened along the Cambie Corridor and will happen along the Broadway Corridor.
Property owners in these locations who are ready to sell will feel like they have won the lottery. However, those preferring to stay but faced with higher taxes will feel otherwise.
Fortunately, single-family homeowners who have lived continuously in their homes for at least 10 years, and whose property values have increased can seek tax relief under Section 19(8) of the Assessment Act. However, they must apply before March 15, 2025.
Since most municipalities are expected to increase 2025 property taxes by at least five per cent, this could be highly beneficial.
Regardless of whether property assessments increase, homeowners over 55 might want to consider deferring their property taxes and let the province pay them. Yes, the province will charge interest, but the rate is prime minus two per cent.
On this happy note, my best wishes for an affordable 2025.
Michael Geller is an urban planner, real estate consultant and property developer. He serves on the adjunct faculty of SFU’s Centre for Sustainable Development and School of Resource and Environmental Management. His blog can be found at gellersworldtravel.blogspot.ca.
Here is a link to the article. https://vancouversun.com/homes/michael-geller-b-c-real-estate-forecast-for-the-year-ahead