Tag: housing supply

• A bureaucratic boondoggle

  Below is a brief interview with Peter Gilgan from Bloomberg North. Peter is the CEO of Mattamy Homes, which is the largest home builder in the Greater Toronto Area.

  In this video he talks about his concerns around a housing bubble and how the government is choking off housing supply in this region – leaving his sales offices mostly closed.

  He’s absolutely right in that everything does seem to take longer, and longer. But I suspect that some of you will debate his comment that homeownership should be considered a right.

  Is renting a bad thing?

  If you can’t see the video below, click here.

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  2017.05.06

• New political support for laneway housing

  There’s some great news in the Toronto Star this week.

  (Thank you Mike for bringing this to my attention.) 

  Two councillors – Mary-Margaret McMahon and Ana Bailao – have come out in support of allowing laneway housing in Toronto. Some cities call them detached accessory dwelling units (DADUs). 

  If you’re new to laneway housing, check out this post and this post (both are 2+ years old). I’ve been on this horse for over a decade.

  Because going beyond their small space cool factor, laneway housing has the potential to fundamentally alter the housing supply constraint that I wrote about a few weeks ago – namely the yellowbelt. It’s a way to gently allow for new housing, while at the same time preserving the character of our “stable” neighborhoods. 

  And frankly, I can’t think of any other way to add new ground related housing at any sort of meaningful scale within the city limits – not unless we’re willing to give up the “stability” of our neighborhoods. So this is it.

  If you’re on the same page, I would encourage you to reach out to Councillor McMahon and Bailao and let them know that. There’s also a public workshop scheduled for Monday, December 5th at 7pm at the Evergreen Brick Works (550 Bayview Avenue).

  2016.11.16

• Urban migration, household type, and housing supply

  Here is an interesting discussion paper on the Toronto region’s economy, demographic outlook, and its land use. It was recently published by IBI Group and Hemson Consulting to support the 10-year review of our regional transportation plan.

  I wanted to share a couple of charts from the report that I thought were interesting. If you’re not in the Toronto region, I would be very curious to hear how your city might compare in terms of the way it is trending.

  The first chart is net migration by age group. Like Vancouver – similar chart posted here – people have been moving into the city/Toronto when they’re young and then moving out to the suburbs once they start having families. 

  Will that continue? The oldest Millennials are now hitting their mid-30′s and I am very interested to see if there will be any reversal in this.

  

  Given the above trend, people in this region are not surprisingly also swapping apartments for ground-related housing as they get older. The crossover point seems to be (or at least has been) when people hit their mid-30′s. Again, I am curious how this may evolve as the city matures.

  

  Because if you look at housing completions from 2001 to 2016 (chart below), the only municipality that was able to meaningfully increase its housing supply was Toronto. 

  Every other municipality – except for Hamilton, which posted modest gains – experienced significant declines in the number of new homes delivered to the market over the last census periods. 

  Of course, the only reason Toronto was able to increase its housing supply was by building up – in other words by building condos and apartments. (Shown in the purple below. For some reason the legend is incomplete in the report.) 

  

  If you look at the share of housing completions, over 80% of new homes in Toronto are now in apartment form. 

  

  Intensification is a deliberate policy choice. And we can certainly debate whether it’s a good or bad thing (I believe it’s a good thing). 

  But putting that aside, the above charts are a great answer to the perennial question: “How is it that Toronto is building so many condos?” This is why.

  2016.08.19

• Dear City Council

  Kate Downing was formerly a planning commissioner in the City of Palo Alto. She recently resigned from her position and, about about a day ago, she posted her resignation letter on Medium. It has since gone viral.

  The reason it has spread so quickly, I think, is because it addresses the very same issues that so many cities around the world are facing: a lack of housing supply and eroding affordability.

  As a developer, I obviously have a vested interest in this matter. But to the extent that I can put that aside, I really do believe that our goal should be to build inclusive, rather than exclusive, cities.

  For instance, when I think of great cities such as New York and Toronto, I think of their history of taking in a large number of immigrants and then empowering them to climb the socioeconomic ladder. There’s something magical about that. One of my best friends likes to talk about this potential as “immigrant hustle.”

  But when we sterilize our cities by allowing only the incumbents to survive, I believe we place that socioeconomic potential in jeopardy. So for that reason, I am reposting Kate’s entire letter. I have bolded the points that stood out for me. Let me know what you think in the comments.

  ———————————————————

  Dear City Council Members and Palo Alto Residents,

  This letter serves as my official resignation from the Planning and Transportation Commission. My family has decided to move to Santa Cruz. After many years of trying to make it work in Palo Alto, my husband and I cannot see a way to stay in Palo Alto and raise a family here. We rent our current home with another couple for $6200 a month; if we wanted to buy the same home and share it with children and not roommates, it would cost $2.7M and our monthly payment would be $12,177 a month in mortgage, taxes, and insurance. That’s $146,127 per year — an entire professional’s income before taxes. This is unaffordable even for an attorney and a software engineer.

  It’s clear that if professionals like me cannot raise a family here, then all of our teachers, first responders, and service workers are in dire straits. We already see openings at our police department that we can’t fill and numerous teacher contracts that we can’t renew because the cost of housing is astronomical not just in Palo Alto but many miles in each direction. I have repeatedly made recommendations to the Council to expand the housing supply in Palo Alto so that together with our neighboring cities who are already adding housing, we can start to make a dent in the jobs-housing imbalance that causes housing prices throughout the Bay Area to spiral out of control. Small steps like allowing 2 floors of housing instead of 1 in mixed use developments, enforcing minimum density requirements so that developers build apartments instead of penthouses, legalizing duplexes, easing restrictions on granny units, leveraging the residential parking permit program to experiment with housing for people who don’t want or need two cars, and allowing single-use areas like the Stanford shopping center to add housing on top of shops (or offices), would go a long way in adding desperately needed housing units while maintaining the character of our neighborhoods and preserving historic structures throughout.

  Time and again, I’ve seen dozens of people come to both Commission meetings and Council meetings asking Council to make housing its top priority. The City Council received over 1000 signatures from Palo Alto residents asking for the same. In the annual Our Palo Alto survey, it is the top issue cited by residents. This Council has ignored the majority of residents and has chartered a course for the next 15 years of this city’s development which substantially continues the same job-housing imbalance this community has been suffering from for some time now: more offices, a nominal amount of housing which the Council is already laying the groundwork to tax out of existence, lip service to preserving retail that simply has no reason to keep serving the average Joe when the city is only affordable to Joe Millionaires.

  Over the last 5 years I’ve seen dozens of my friends leave Palo Alto and often leave the Bay Area entirely. I’ve seen friends from other states get job offers here and then turn them down when they started to look at the price of housing. I struggle to think what Palo Alto will become and what it will represent when young families have no hope of ever putting down roots here, and meanwhile the community is engulfed with middle-aged jet-setting executives and investors who are hardly the sort to be personally volunteering for neighborhood block parties, earthquake preparedness responsibilities, or neighborhood watch. If things keep going as they are, yes, Palo Alto’s streets will look just as they did decades ago, but its inhabitants, spirit, and sense of community will be unrecognizable. A once thriving city will turn into a hollowed out museum. We should take care to remember that Palo Alto is famous the world over for its residents’ accomplishments, but none of those people would be able to live in Palo Alto were they starting out today.

  Sincerely,

  Kate Downing

  2016.08.11

• Population growth across North American cities

  The Centre for Urban Research and Land Development at Ryerson University recently published the following chart on their blog:

  

  It’s a look at population growth across a few North American cities, broken down according to natural increases, net internal migration from other parts of the respective country, and net immigration from outside of the respective country.

  When you sum up the pluses and minuses shown above, you get to population growth numbers that look like this:

  

  Houston, Dallas, and Atlanta are monsters in terms of population growth. They’re obviously smaller than New York and Los Angeles, and so on a percentage basis they are really adding a lot of people. Much of this has to do with the ease in which housing can be added in those cities and their relative affordability.

  Toronto is competitive with New York and Los Angeles in terms of an absolute number, but again our base is smaller so on a percentage basis we are growing faster. The big story with Toronto is our dependence on immigration to grow.

  The one city on this list that might surprise some of you is Chicago. Toronto and Chicago share many similarities and are often compared. But when you look at how the Chicago metropolitan area is shedding people, you see that, at least in this regard, it’s in structural decline.

  2016.04.17

• BARF is fighting for more housing in San Francisco

  A new YIMBY activist group is starting to gain meaningful traction in San Francisco. They were recently featured in the New York Times and they have managed to secure the financial backing of people like Jeremy Stoppelman – co-founder and CEO of Yelp. 

  (All excerpts in this post were taken from the NY Times.)

  

  The group is called SF BARF, which stands for SF Bay Area Renters’ Federation. The group, however, supports new development of all kinds. So I think the name is more driven by the fact that the founder, Sonja Trauss, wanted the acronym to be BARF. It speaks to their shit disturbing approach:

  “Her group consists of a 500-person mailing list and a few dozen hard-core members — most of them young professionals who work in the technology industry — who speak out at government meetings and protest against the protesters who fight new development. While only two years old, Ms. Trauss’s Renters’ Federation has blazed onto the political scene with youth and bombast and by employing guerrilla tactics that others are too polite to try. In January, for instance, she hired a lawyer to go around suing suburbs for not building enough.”

  The impetus for all of this, of course, is San Francisco’s lack of affordability and severe housing shortage. Housing supply is decades behind the city’s population and job growth. 

  Most people are directing the blame at the tech community for bidding up housing. But there’s clearly growing recognition that housing supply matters.

  As a real estate developer, my industry obviously benefits from fewer barriers to building. So let’s get that out there:

  “Ms. Trauss’s cause, more or less, is to make life easier for real estate developers by rolling back zoning regulations and environmental rules. Her opponents are a generally older group of progressives who worry that an influx of corporate techies is turning a city that nurtured the Beat Generation into a gilded resort for the rich.”

  But let’s also be clear that I don’t believe we should be developing roughshod over our cities. New development should respond to what’s already there and give back. 

  At the same time, housing supply matters a great deal. A big part of the reason that cities like San Francisco, New York and Vancouver are so expensive is that they’re naturally supply-constrained markets. Geographically, they are either peninsulas or islands.

  When you overlay tight land use restrictions, fierce community opposition and/or foreign investment on top of this geography, it should come as no surprise to anyone that demand is outstripping supply. 

  New supply won’t solve every problem, but I do agree that it is an important part of the solution.

  2016.04.16