experts: real estate column Thursday, September 13, 2012

Magic Word - Densification Revisited

High demand locations are running out of that scarce commodity - space.

By Alan  Skinner

A recently quoted reference to the comment of an elected official (or senior staffer, I forget which) in the Toronto area referred to "potential evils" of ongoing densification in the GTA. Well, yes, no change suits all and the pros/cons of anything "new" will always spark (often heated) debate. This put me in mind of an article I penned some 6 years or so ago which I've sought out and, with your indulgence, shall paraphrase here. Whenever I see a "new" word or, some may say 'manufactured jawbreaker!', I'm reminded of the term - floccinaucinihilipilification, at 29 letters, said by some to be the longest word (that is not a place name) in the English language. Meaning, ironically - "the action or habit of estimating as worthless"! Go figure!! The Latin (root) scholars would be able to pronounce - all others will have to hear my podcast to see if I can do so! But what does this newer "buzz-word" mean? Simply 'making more dense' or in the real estate sense more human beings living in each square mile. The obvious question is "why?" - salient points i) people want to live in a desirable area such as Vancouver - or the North Shore to be specific - ii) these high demand locations are running out of that scarce commodity - space. Again, and I make no apology for my overplayed theme, we are back to Supply and Demand. A quick, 'related' diversion and I'll come back to Demand.

Former Vancouver Mayor, Sam Sullivan, concentrated some efforts on softening the 'sound' of this practice by coining the term Eco-density (a coexistence with the local ecology in a more concentrated way). The then, Vancouver City Director of Planning, Brent Toderian explained Sullivan's message as "whatever will convince people to love higher density". A far cry from the lyrics of the early 20th century song - "Give me land, lots of land and the starry skies above..."! He went on to say that a mere 11% of Vancouver's land was being used for multiple residences. Can we, will we, adapt? It seems that we will need to do so if we wish to coexist in a paradise such as Greater Vancouver (or in our sub 'paradises' - is this word?? ... of North and West Vancouver). On this matter a comment made by a colleague implied a "get thee to a rural area if this offends"- type of sentiment. I, at first, thought this was a little harsh but, upon reflection, am more of the mind that dictating a 20th century 'status quo' to we who are firmly into the 21st would be inappropriate (and impractical?).

A Vancouver Sun article reinforced the "living in a smaller space" trend by highlighting the fact that "Boomers" were driving the demand to downsize. Strangely enough, this demand will make many smaller homes (1/2 duplexes, multi-bedroom apts) more costly than larger "family" homes geographically further out. The point is that these "wealthy" boomers are going to be demanding the prime smaller dwellings and unless the market makes provision for an increased supply of these - the price of the existing stock will surge. So, potential retirees, this is a "buyer beware" that you should heed! Note: Isn't this just what we are seeing on our North Shore - one persons' overbuilding is another's forward thinking!

Now again our summary of North Shore results. North Van detached homes sold are down 'year to date' by 20% from this time last year, attached (t/hses) sold - down 16% and apartments down 8% from 2011. Detached - average price is 7% higher than 2011 and inventory Aug 31st, 2012 up 43% from 2011. Average prices up 5% (t/hses) and up almost 1% (apts). Inventory (t/hses) up 4% from Aug 31st, 2011 and (apt) up 12% from 2011. N/Van overall inventory at Aug 31st, 2012 is up 22% over 2011 and all categories in N/Van, down 16% in total sales '12 vs. '11.

In West Van, detached number of sales to date 2012 is down by 49% from last year. Average price up by 8% and inventory Aug 31st, 2012 up 22% from last year. On the condo side - sales of attached (t/hses) are up, at 56 vs. 45 units; average price is now 24% higher. Active listings as at Aug 31st, 2012 (55 vs. 25). Apartments sold are down from 2011 (119 vs. 160), with average price 15% lower than' 11 (remember the small sample size) and active listings up 9% from Aug 31st, 2011(107 vs. 98). Overall 27% higher inventory with softer demand evident - particularly detached properties. Some 43% fewer units sold YTD vs. 2011 (629 vs. 1100).

An exciting recent addition (for those who relish actual results - number of homes sold, average price and inventory). I will be happy to forward the past 12 month trend for both N and W/Van. Just fire off an e-mail to me at alanskinner@shaw.ca asking for 'SnapStats'. If you are interested in what price ranges are selling and which are not, you will love this! P.S. I am now going to include ALL neighbourhoods as many of you have contacted me to ask if these are available. I guess some of us are moving across town. If not of interest, please ignore those areas.

Again, visit my website to see and "hear" the new developments. I continue my commitment to keep you... www.OnTopOfTheMarket.ca - the "go to" site for North Shore Real Estate analysis and jumping-off point for FULL market listing information.

To join those wishing to get the e-mail version of this "update" - send a request now to alanskinner@shaw.ca and you'll be assured receipt; phone me at (604) 988-7368 or visit www.OnTopOfTheMarket.ca




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Recent Articles by this columnist:

Keeping Realtors Honest
Tuesday, August 12, 2014


How well do we stack up?
Tuesday, July 29, 2014


Resistance to change and compliance delay
Wednesday, June 04, 2014


Of urban planning and municipal wisdom
Thursday, April 17, 2014


Yes, it's official - demand is rising
Tuesday, March 11, 2014


All articles by Alan  Skinner

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