Two Years of BC’s Speculation and Vacancy Tax Data!

Last week, the BC Government dropped a press release linking to 2019’s data from the NDP’s Speculation & Vacancy Tax (SVT), leaving us with two years of data (!) and including a brief analysis of what happened to properties taxed in 2018! Maybe you didn’t notice? It was a busy week. I’ve been looking through the data and comparing across releases, and here are my big takeaways so far:

  • Overall, tax liability remains very rare (< 1%), and seems to be getting more so
  • The 2019 Technical Report revises some of the 2018 taxpaying figures, generally downward
  • The SVT may have added some rental in 2019, but probably not as much as claimed
  • Best guess: probably because we never had much “toxic demand” to begin with…
  • There’s some hint the SVT might have promoted divorce a bit & probably also migration
  • Some errors and lapses in SVT reporting make interpreting the data harder than it should be!

Before expanding on these takeaways, a quick re-cap is probably in order. The BC’s Speculation & Vacancy Tax (SVT) is effectively an additional property tax on empty dwellings (set at a higher rate for non-Canadian owners) coupled with an additional property tax on transnational families (a.k.a. “satellite families”) where the primary income earner files their income taxes outside of Canada. The SVT was brought in by the NDP government in 2017 as a means of combating “toxic demand,” with the idea that investors were leaving residential properties empty and driving up housing costs for BC residents in selected areas of the province (mostly Metro Vancouver, but also further up the Fraser Valley, inland in the Central Okanagan, and on the Island around Greater Victoria and Nanaimo). The SVT was layered over top of the Foreign Buyer Tax (a property transfer tax paid only at point of sale) brought in by the BC Liberals in 2016. Within the City of Vancouver the SVT was also the layered over the Empty Homes Tax (a simple additional property tax on empty dwellings), also from 2016.

Here are the SVT Technical Reports I’m comparing from 2018 and 2019 (with a separate file broken down by municipalities in 2019). So what does a second year of BC’s Speculation and Vacancy Tax data show? First off, the big finding: for the second straight year in a row, the data demonstrate there’s little “toxic demand” to be found in high demand parts of BC. In both 2018 and 2019, significantly less than one percent of properties fall in taxed (non-exempt) categories.

In all property categories created by the SVT, the vast majority of properties are exempt from the tax, regardless of ownership. Those not exempt from the tax provide us a measure of “empty dwellings” except for the “satellite family” category, where residents may owe the tax even when they live in the property. Overall, less than half a percent of properties are empty or owned by satellite families in 2019. The biggest decline in taxed properties by category appears in the “Foreign Owned” category, though taxed “Satellite Family” and “Mixed” ownership properties have also declined.

We can turn from properties to look at owners paying the SVT. These are somewhat easier to track insofar as properties can have multiple owners (with multiple statuses, leading to some of the complicated categories above). Looking at owners fitting into different categories across SVT reports, we get our first hint that the 2019 update also includes revisions to the 2018 data. In nearly every case, the number of owners owing tax in 2018 were downwardly revised by 2019. For the 2019 data, the number of owners owing tax dropped further.

The gradual decline in owners subject to the SVT, both across revisions to the 2018 data and across years extending into the 2019 data, suggests that the more closely we look at files, the fewer owners owing tax we find. This is the opposite of what we’d expect if close scrutiny of files revealed a great deal of evasion. If that were the case, revisions would be expected to increase the number of taxpayers.

The vast majority of exemptions from the SVT are in the form of either “principal residence” (for people who live in the properties they own) or “occupied by tenant” exemptions, either indicating the property is lived in (or at least contracted for living in) for at least six months of the year. A close look at both SVT reports reveals that those claiming these two exemptions have gradually risen, both through revisions to the 2018 report and through the 2019 calendar year.

The rise in exemptions from the tax due to occupation by a tenant between 2018 and 2019 offers one measure from the SVT data of how many dwellings might have been brought back into the rental market through the incentives of the SVT (Table 5). But exemptions are tricky, insofar as multiple exemptions may be applied to the same property. Another measure of how many dwellings were brought back into the rental market by the SVT could be found in directly examining how many properties paying the tax in 2018 were subsequently rented out in 2019 (Table 10). Interestingly, the 2019 SVT Technical Report does not draw upon either of these measures, derived from SVT data contained. Instead the report (p. 3) references a CMHC Report on the Secondary Rental Market in Metro Vancouver examining existing condos newly added to the CMHC’s rental universe in 2019. Lining up different estimates of how many dwellings might’ve been induced back into the rental market by the SVT suggests why… the CMHC report’s estimate – even focusing only on Metro Vancouver – is the highest. Unfortunately, it’s also probably the most flawed as a measure of SVT effects, both insofar as those effects aren’t measured directly, and insofar as the bump in units entering the rental market may have arisen from changes in reporting to CMHC rather than changes in actual rentals.

Overall, it’s likely that the SVT induced more dwellings into the rental market in 2019, but probably not as many as claimed. That shouldn’t be too surprising given that the tax was already in place in 2018. Most units rented out in response to the SVT were probably already rented out prior to 2019. Unfortunately, we didn’t see the big rise in vacancy rates we might expect if a lot of dwellings had been added to the rental market in 2018 either. Nor can I discern sizable increases in dwellings offered for sale prior to the imposition of the Speculation and Vacancy Tax in 2018. Though it’s difficult to fully analyze the effects of the SVT on patterns prior to its arrival, there’s little to suggest much in the way of a great deal of “toxic demand” suddenly released as supply back onto the market. That said, and regardless of its effects on existing patterns, the SVT could still operate as a powerful prophylactic, preventing Vancouver from becoming a resort town of half-empty pied-a-terres for the wealthy. (As a potential future, it’s not so far-fetched – it looks kind of like Miami).

Let’s round out SVT reporting comparisons by looking at other exemptions claimed. These are magnitudes less common than exemptions for principal residence or occupancy by a tenant, plotted above. But they’re quite interesting nevertheless, often revealing the main reasons why dwellings get left empty. Most commonly, it appears, they’re just between residents, as when a property is newly acquired, being renovated, or under construction. Exemptions for “recent acquisitions or inheritances” rose between 2018 and 2019, likely simply reflecting annual variation in sales. Other properties actually have no residence built on them. An exemption for stratas with rental restrictions remains in place. Less commonly, special circumstances are granted to those where ownership remains in flux, and perhaps under dispute, as with divorces and deaths of an owner.

Divorces are especially interesting insofar as the initial 2018 release listed “separation or divorce” as the #8 most common exemption. In the 2019 release, “separation or divorce” no longer made the top ten, and had been scrubbed as an exemption in the 2018 revision as well. The scrubbing of “separation or divorce” from the revision probably reflects a simple process of drawing upon the top ten exemptions in 2019 and comparing backward (though this produces an error, insofar as the 2018 “separation or divorce” figures don’t appear to have been added back in as an “other exemption” update for 2018 revised figures, which is concerning). What’s the substantive impact of this little reporting glitch? Unfortunately it means we only get a hint at a possible effect of the SVT: a bump in separations or divorces. We have ample reason to expect such a bump for 2018. After all, the logic of the SVT as applied to “satellite families” is that it’s fine and totally forgivable to be separated from a spouse who jointly owns your home due to irreconcilable differences. But if one is separated from a spouse instead simply by their work in another country, that’s a “satellite family” and you’re subject to the tax. No surprise people might re-evaluate the nature of their relationships to their spouses in response to the SVT, temporarily bumping up separations and divorces. As with rentals, we might expect this response to be strongest in the first year of the SVT, subsiding (and hence moving down the list of exemptions) by 2019, which appears to be what we see above. Though trickier to establish, we would also expect immigration and migration as potential responses to the SVT, with owners moving to (or returning to) BC to avoid the tax. Many of these plans might simply speed up processes already happening anyway. Of note, more careful and consistent releasing of data would be needed to study these kinds of responses more closely.

Errors in the 2019 SVT report also plague the study of properties by ownership category. In my first chart (at the top), I use “non-exempt” figures from Table 7 in the SVT 2019 report rather than “total” non-exempt figures from table 8. Logically, these two figures should map perfectly on to one another (as the corresponding tables do in the SVT 2018 report), but in the SVT 2019 report they diverge quite a bit with respect to how properties were assigned into “other Canadian”; “foreign”; “satellite”; “mixed”; and “other” categories. Via comparison to 2018 figures and to Table 10, Table 7 looks like it contains the correct breakdown into categories. But here, too, errors in the 2019 SVT report make it difficult to confidently analyze the data. As noted above, the complicated matching of multiple owners to properties likely explains potential mismatches across tables, but it sure would be helpful if SVT reports took a consistent view of the matter!

Below I use figures from Table 7 in combination with Tables 10 and 11 to try and follow properties that were taxed in 2018 over time into 2019, to see what happened to them next. Though I’m critical of the SVT reporting errors (as above), it’s great that they provide this ability to follow properties for us! Here’s what I get…

Overall, it appears that most of the properties paying the SVT in 2018 were no longer paying it in 2019. Mostly the owners in 2018 either moved into their properties by 2019, rented them out to someone else, or sold them off (or otherwise removed their name from the title). Selling or renting were the most common strategies for Foreign Owners, accounting for most properties, but a minority simply held onto their property and paid the tax for another year. Satellite Families were more evenly split, between claiming as a primary residence in 2019, selling, renting out, or simply paying the tax again in 2019. Some of the difficulties in classification here continue to plague a full understanding, but the fact that satellite families were the most likely to transition into a primary residence exemption likely reflects some combination of marital and migratory responses to the SVT, as discussed above. Other Owners (here including BC Residents, Other Canadians, Mixed, and Other categories) mostly rented, sold, or paid the tax again. Way more Other Owners paid the tax again than for other categories, likely reflecting, in part, the lower tax rates they generally paid under the SVT structure. For similar reasons, we see many more Other Owners – reflecting mostly BC Residents – added as new taxpayers in 2019 than for other categories. The tax seems to have been most effective at driving out the (relatively rare) “empty” properties of Foreign Owners, but new “empty” properties with domestic owners seem to have replaced at least some of those Foreign Owners as tax-payers.

Overall, it’s great to see more Speculation and Vacancy Tax data out, warts and all! It probably continues to be our best source of data about “problem empties” across high demand regions of the province, and also potentially – with a bit more care – could give us new insights into underlying housing, migration, and family processes.

What to Expect from an Empty Homes Tax

Joint with Jens von Bergmann and cross-posted at mountainmath

Empty Homes Taxes are back in the news!

In a very short time period, we’ve got Vancouver raising its Empty Homes Tax rate from 1% to 3%, based in part on a report from CMHC about a sharp rise in condos on the rental market, we’ve got Toronto eyeing its own Empty Homes Tax, and now reports suggest that even Ottawa is considering getting in on the game.

We’ve long argued that Empty Homes Taxes are a pretty good tax. Consider it as equivalent to a bump up to property taxes (which cities like Vancouver could really use!) paired with a principal residency exemption, kind of like BC home owner’s grant, but also applicable to property owners who rent out their properties on a long-term basis, hence providing incentive to keep housing occupied.

The incentive is real. But we have questions about whether Empty Homes Taxes are being oversold as solutions to the broader housing crises facing Metro Vancouver, Toronto, and Ottawa. To start with, as we’ve demonstrated previously, none of these metro areas rank particularly high in North America in terms of vacant housing stock on census day. Indeed, all Canadian cities appear to be on the low end, implying relatively few of the abandoned homes and vacation pied-a-terres that seem to push up vacancies in many US cities.

Vancouver and Ottawa appear high for Canada, but somewhere between low and middle-of-the-road for North America as a whole. Toronto is definitely on the low end. Of note, a scan of the data for the US, which includes reason for vacancy, suggests that regular housing processes (dwellings up for sale or rent, awaiting new residents; dwellings caught in temporary legal limbo after the death of an owner, etc.) account for a substantial portion of vacant homes overall. For metros at the high end of vacancies, these numbers are boosted by abandoned homes and/or pied-a-terre vacation homes. This suggests that abandoned homes and pied-a-terres just aren’t that common in Canada.

With some caveats, we can test this by looking at Vancouver’s Empty Homes Tax and BC’s Speculation & Vacancy Tax data. Most homes that appear as if they might be empty qualify for exemptions from these taxes, reflecting regular housing processes. After exemptions, there just don’t seem to be very many empty dwellings left. In the most recent Vancouver EHT data, declared vacancies range by neighbourhood from 0.08% (in Sunset & Grandview Woodlands) to 1.26% in the West End, roughly matching the City of Vancouver’s 0.7% of properties non-exempt from the tax in the provincial SVT data (excepting out “Satellite Families”, which would bump the figure to 1%).

Of course, taxes may be bringing dwellings back into the rental market that weren’t there in 2016, meaning our EHT and SVT data might be reflecting big declines in empty units. What about that CMHC study showing a bump of condos being rented out after the Empty Homes Tax was imposed? Well, funny story… first it’s important to know that the study is based on condo managers reporting from their Form K, which are meant to be filed when condo units are rented out, but in the past have been largely inconsequential. Indeed, in previous work we have highlighted that the CMHC estimate of rented condos in Metro Vancouver differs significantly with census estimates.

Here it’s notable that the first year of the EHT’s existence did not see a great many condos added to the rental market. But after the Speculation and Vacancy Tax came into place, the number of condos being rented out seemed to grow quite a bit. Was this a real change, perhaps because the added taxes became higher? Or did this represent a reporting change? Due to a variety of policy changes (including SVT), suddenly failure to file Form K has more teeth. As a result, it’s likely the reporting compliance for From K has gone up significantly. In other words, we’re not actually certain that a slew of condo units recently came onto the rental market. It may be, instead, that a slew of condo units already on the rental market were suddenly reported correctly. Overall, it is hard to get robust estimates of how many units have entered the market in response to the tax, but there’s no doubt some have. Looking at City of Vancouver data on homes that are either exempt or pay the tax, and cross-referencing this with the Ecotagious study estimating vacancy by electricity usage, we can arrive at a very rough estimate of the number of homes returned to the market being roughly double the number of homes that end up paying the tax. Which is a sizable achievement.

So what should Toronto and Ottawa expect from an empty homes tax? We have previously used City of Vancouver data to give fairly accurate projections for the Speculation and Vacancy Tax, and we can apply the same method to Toronto and Ottawa at the city level. The estimate is quite crude, it simply scales the units “unoccupied” on census day to match the City of Vancouver Empty Homes Tax numbers. So let’s take a quick look at what kind of dwelling registered as “unoccupied” in the Census.

While there is some variation across the regions, the duplex category, which generally captures houses with basement suites, comes out universally with the highest share of unoccupied homes. We have written about this at length before and it should not be surprising given the flexible nature of secondary suites that they are used flexibly, which frequently means that they aren’t rented out. Of course, these suites also aren’t taxed as empty, since they’re considered part of one residential property and can so easily be reabsorbed into the main dwelling. The high prevalence of basement suites in Vancouver is a big part of what drives up its vacancy rate in the census.

Taking account differences in housing stock we can apply a crude formula from the City of Vancouver Empty Homes Tax experience, assuming exemptions are structured similarly. Accordingly we can project that an Empty Homes Tax would capture around 2,000 units in Ottawa and 6,000 in Toronto. Roughly twice that number might be induced to re-enter the rental market in each city.

So should Toronto consider an Empty Homes Tax of its own? Relative to the size of Toronto’s housing market, we probably shouldn’t expect an Empty Homes Tax to a) find very many empty homes, or b) create much new revenue. We’re likely looking at shifting over no more than a single percentage point of units into the market. But adding any new units to the market is good. And we like Empty Homes Taxes overall. Just insure expectations are set accordingly!

What about Ottawa? Similar wisdom pertains. Set expectations accordingly! At the same time, Ottawa is instructive to consider insofar as it’s the centre of government for Canada. We actually kind of expect a certain number of properties will be empty a substantial portion of the year. Why? Well, Members of Parliament and Senators are both expected to represent other parts of the country in Ottawa. In other words, they’re expected to split their time between Ottawa and elsewhere. Indeed, Senators are still required to own at least $4,000 worth of real property in the province they represent, though there’s currently a bill to repeal that requirement (property requirements for MPs were abolished with the 1920 Dominion Elections Act). Again, not to say an Empty Homes Tax is a bad idea for Ottawa, and why not tax politicians a bit more? But Ottawa is also uniquely well positioned to demonstrate why some people, including – but not limited to – MPs and Senators, maintain some form of residence in multiple places. And Empty Homes Taxes necessarily tend to hit hardest for anyone who finds it difficult to choose just one.

As usual, the code for this post is available on GitHub for anyone to reproduce or adapt for their own purposes.

BC Housing Platforms!

It’s election time in BC! And housing is back on the agenda, even if not quite as centrally as in past elections. Here I want to provide a quick basis for comparing each party platform, adding in a short bit of my own analysis. My quick take is that when it comes to housing there are things to like in each platform, and I hope the parties work together to keep housing on the agenda!

I’ve drawn housing proposals from the platforms of the BC NDP, the BC Liberals, and the BC Greens. It’s possible that housing-related items show up in other parts of the platform, but I’m focusing on the sections linked. For anyone following along outside BC, the NDP are a provincial labour-oriented left-leaning party, affiliated with the federal party, the BC Liberals are a centre-right amalgam, combining sympathies for both federal Liberal and Conservative parties, and the BC Greens sympathize with the federal Greens. We’ve had a governing coalition of the NDP and Greens since they managed to cobble together an alliance booting out the BC Liberals in 2017.

I tried to compare based on broad categories of proposed action in housing, highlighting more concrete proposals over vague suggestions where possible. Here’s what I get, divided into two parts below, the first covering COVID-relief, Taxation, Strata Insurance, and Social Housing, and the second covering Development. Click on each graphic to blow them up!

In terms of COVID relief, the NDP have offered to freeze rents until the end of 2021 (optimistically forecasting the end of the pandemic). After that, they propose to limit rent increases to inflation, in line with their application of rent control provisions in BC to date (under the prior BC Liberal administration, rent increases were generally capped at inflation + 2%). The BC Liberals suggest their COVID relief proposals will be targeted at tax relief for home owners (most of whom can already defer their property taxes). The Greens, who’ve had the least time to develop their platform thanks to a leadership contest followed almost immediately by a snap election, don’t suggest any specific COVID-relief related housing policies.

Taxation & Strata Insurance!

Restructuring of tax policies more broadly has been a persistent theme in BC’s recent history, with the NDP’s establishment of an Additional School Tax on high value ($3m+) properties and Speculation and Vacancy Tax (SVT) hitting mostly vacant properties, but also those occupied by “Satellite Families” at the end of 2018 following the BC Liberals imposition of a Foreign Buyer’s Tax (FBT) in 2016. This time around, the NDP are re-upping a promise from last election, the $400 Renter’s Rebate tax credit for renters to complement the existing home owner grant reducing annual property taxes (the BC Greens famously opposed said rebate).

The BC Liberals hope to scrap the SVT, and replace it with a capital gains tax targeted at condo flipping (not yet well-defined) and higher property tax rates for non- residents of Canada (a slippery concept). The BC Greens want to keep the SVT but close “loopholes” allowing exemptions for “Satellite Families” and foreign owners. It’s not clear what exemptions the BC Greens are talking about, but here are the ten most common claimed. Of note, the SVT currently applies to very few properties (<1%). If all declared foreign and satellite families exempted in the last tax data were forced to pay the tax, then just over 3% of properties would pay. The BC Liberals also propose creating a new property tax category (along with lower rates) for purpose-built rental buildings containing three or more units (a cut-off that could include some subdivided detached house properties in Vancouver!)

All parties have responded to rapidly rising strata insurance costs, suggesting reforms to bring down costs, but in a few key different ways. The NDP suggest providing a public option in case costs don’t come down. The BC Liberals are pushing for lessening insurance requirements. The Greens are… proposing a task force to look more into the issue.

Social Housing

All of the parties pay at least some lip service to adding to BC’s stock of affordable social housing. As the party in power, the NDP have the most developed proposal in the continuation of their Homes for BC plan, promising 114,000 new affordable units through partnerships over 10-years. The NDP have also proposed new transitional supports to renters moving from supportive housing into the private rental market. The BC Liberals and Greens offer more vague support for social housing investment, especially promoting cooperatives (UPDATE: more specifics from BC Liberals just released today!). The Greens also propose applying $500 million toward a new renter’s grant, aiming to bring rental payments for tenants down to no more than 30% of their income. It’s not yet clear whether this is simply an expansion of the current Rental Assistance Program offered by BC Housing, or meant to apply differently, but the potential pool of applicants in BC remains quite large.

Development

All of the parties offer something in the form of acknowledging the limited range of housing on offer in BC. Both the BC NDP and the BC Liberals place at least part of the blame on sluggish BC municipalities. Both parties push for streamlining municipal and provincial permitting processes that have slowed up and added expense to the development of new housing. The BC NDP also make a welcome proposal to eliminate parking minimums for projects near transit.

The BC Liberals add a variety of other proposals, pushing to match municipal zoning more directly to official community plans and potentially waive rezoning hearings for projects complying with plans. Similarly, the BC Liberals suggest strengthening and enforcing municipal adherence to regional growth targets. To match these “sticks” the BC Liberals would apply to municipalities, they also suggest “carrots” in the form of an incentive fund offered to municipalities expanding supply. Other welcome suggestions include digital tracking for development projects, enabling the identification of hold-ups in the approval process. Interestingly, the BC Liberals also suggest mixing a cautious approach toward rental zoning (recently enabled by the NDP) with provincial restrictions requiring replacement of rental apartments (which many municipalities already require). Finally, they suggest upping the mandated number of disability-accessible units for new developments. The BC Greens call for encouraging a “missing middle,” but offer the fewest specifics on development reform for getting there. Yet they embrace two proposals for reforming development that many in the non-profit housing sector have long called for, including both a capital fund to acquire old rental buildings when they come up for sale, preserving affordability, and the establishment of a land bank to support cooperative development.

Mix and Match!

Overall (and staying positive) there’s a lot to like in mixing and matching the housing platforms on offer. I like many of the NDP’s taxation and social housing ambitions (though I don’t like targeting satellite families and I’d up property taxes and social housing construction further); I’m happy with the Green’s embrace of supporting land banks for cooperatives; and it would be great to see many of the BC Liberals plans for reforming and improving the municipal role in approving housing development implemented (also shout out to the NDP here: yay for lifting parking minimums!) Let’s hope everyone keeps their good ideas on the table after the election’s over!

Homeless Counts and Migration Patterns in Metro Vancouver, Calgary, and Winnipeg

People move. That includes people who end up getting counted as homeless. How should we interpret what homeless counts tell us about these people?

To an important extent, this question brings us back to fundamental interpretations of who gets counted. Is being counted as “homeless” interpreted as a social problem: the lack of enough accessible housing? Or is it being interpreted as a person problem: identifying the “homeless” as fundamentally different from housed people?

I’m a sociologist and a housing scholar, and I think homeless counts can be really useful indicators of the social problem of housing inaccessibility. We’ve got some great solutions to this problem, which basically come down to making more housing more accessible to more people. The alternative approach, interpreting homeless counts as identifying problem people, is… really problematic. The solutions it points toward tend to involve “fixing” people (at best?) or keeping them out entirely.

We can see an example of this problematic approach at work in a recent article, entitled: “Vancouver is Canada’s dumping ground for the homeless, and this needs to stop.” The language is offensive, immediately identifying those counted as homeless as more like trash than people, and pointing toward the need to keep them out. Sure enough, the gist of the piece is that Vancouver’s homelessness problem is being driven by problem people coming here for our mild weather in combination with the concentration of supports and services here and the lack of them elsewhere. This mixes a potentially good message (we need more housing and services and supports everywhere) with a bad message (so stop providing them here) as well as the aforementioned dehumanization.

From here on out, I’m going to set aside these portions of the argument and turn my attention toward a few of the empirical claims. Correspondingly, I’m also going to focus at the metropolitan level in terms of thinking about migration and homelessness, meaning I’m setting aside how people counted as homeless, as well as supports and services, are distributed within metro areas (my position, again, is that we need more housing, supports, and services, and every neighbourhood should have them). For the rest of this piece, I’m mostly going to return to my starting question: how should we interpret what homeless counts tell us about people who move? And I’m mostly going to do it by comparing patterns of migration as they show up in homeless counts in Metro Vancouver to Calgary and Winnipeg.

First let’s start with a few relevant claims from the “dumping ground” piece that are easy to knock down. Do people counted as homeless in BC disproportionately congregate in Metro Vancouver? That’s an easy one, and the answer is: no. As I showed awhile back with a post drawing upon coordinated provincial counts, on a per capita basis, Metro Vancouver has fewer people showing up in homeless counts than most other metro and non-metro locations across BC. Why use a per capita basis? Because people counted as homeless are people. And knowing what proportion of people get counted as homeless tells us something important about where we see problems with the accessibility of housing. These problems are widespread across BC rather than concentrated in Metro Vancouver.

What about more broadly? Is Metro Vancouver Canada’s “epicentre of homelessness”? Is it due to our mild weather as claimed in the piece above? Let’s look outside BC, comparing Vancouver to Calgary and Winnipeg (where no one’s claiming mild weather). If Vancouver was really the epicentre of Canada’s homelessness crisis, you’d think we would jump out when we control for the size of the surrounding population. But quite the opposite happens. Both Calgary and Winnipeg have more people showing up in homeless counts per 10,000 residents than in Vancouver.

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So maybe Vancouver’s not the epicentre of where people are becoming homeless, but instead the place where people are disproportionately moving after they become homeless elsewhere? Except, when we look at the proportion of people counted as homeless who migrated to each city within the last year, it’s actually much higher in Calgary, and only a little lower in Winnipeg. Suddenly the idea that all Canada’s homeless people are moving to Vancouver because of the weather looks pretty… well… ludicrous.

It’s worth noting that Winnipeg was actually featured as the origin for a homeless man in Vancouver in the image accompanying the “dumping ground” piece. So we should definitely take a look at how Winnipeg’s Street Census makes available the origins of its interprovincial migrants who show up as homeless. Guess what: 23% of them came from BC!

Is Vancouver dumping its homeless on Winnipeg? That’s probably just as bad a take as the converse. A better take is that people move. And not just to Vancouver. And that people counted as homeless are first and foremost people.

But do people who show up in homeless counts move for different reasons than other people? We don’t actually have that data for Vancouver or Winnipeg. But Calgary has it! So just for comparison purposes, let’s set reason for move to Calgary in the past year for those who show up in Calgary’s Homeless Count alongside reason for move for a more general selection of the population. In this case, the most similar question and options on reason for move actually come from the USA’s Current Population Survey (Mobility Table 17), so we’ll plot the two together. (If you want to see more on reason for move data and comparability, have I got the post for you!)

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The options are worded differently in places, but I’ve attempted to harmonize them as possible, and the correspondence is pretty clear. Main reasons for move fit into the same four broad categories (work & opportunity, family, housing, other) for those who end up homeless in Calgary as for all movers in the USA, and in roughly the same proportions. Where responses differ, they tend to indicate that migrants who end up counted as homeless are taking slightly bigger risks than migrants overall. For instance, fewer people who ended up homeless in Calgary moved with a job already secured, compared to those who moved looking for work. But overall, the patterns suggest that people who move and then show up in homeless counts seem to move for pretty much the same reasons as everybody else.

People move. And moving is actually kind of risky.

Mostly moving works out pretty well, and people find work and a place to live. But sometimes it doesn’t work out. So some people move on again or return to where they came from. Others, for various reasons, find themselves homeless. Are recent movers more likely to find themselves homeless than long-time residents? Let’s compare homeless count data to general mobility data to find out.

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And there it is. Even though most people who show up in homeless counts are long-time residents, being a recent mover to a region is much, much riskier. For both intraprovincial and interprovincial migrants, moving to a new place is a brave thing. This makes intuitive sense. Recent movers have to find housing without the benefit of already having any. They join a much smaller pool of local residents displaced from their housing in the search for a new place to live without the benefit of an old place to hold onto. So overall, recent movers are much more likely to find themselves out of luck in the search for housing than long-time residents. This seems to be exactly what we see for both intraprovincial and interprovincial migrants. Why doesn’t the same pattern fit for international migrants? Several studies have aimed to answer this question, and the short answer is: because international migrants are both selected and supported differently. As a result, they’re much closer to long-term residents in terms of their reduced risk of becoming counted as homeless, even though the risk is still there.

Seeing as how they’re at greater risk for being counted as homeless, we should probably be doing more to support recent movers to our cities. ALL of our cities. How? By making more housing more accessible for them.

The resistance to making more housing more accessible sometimes comes from the xenophobic notion that housing should only go to local residents. That movers should be somebody else’s problem. There are many who’d prefer to erect walls around our cities, keeping new folks out. Other times it comes from the idea that anyone who can’t find housing must be defective, which is right where we started. And maybe it even comes from the notion that our mild weather means people don’t need housing quite as badly as elsewhere in Vancouver.

We can probably make the case for that last point by looking at how many people are left unsheltered here in Vancouver compared to Calgary and Winnipeg. Vancouver has fewer people counted as homeless per capita compared to Winnipeg and Calgary, but many more people left unsheltered. Our mild weather doesn’t seem to be drawing people here in any disproportionate fashion, but it might be enabling a callous disregard for housing needs.

Tap to enlarge image

On a final note, the high proportion of those without shelter among the people counted as homeless in Vancouver might also account for the recent reactionary stance taken by many local politicians and activists. The visibility of those left without shelter makes homelessness seem a bigger problem here than elsewhere. Interpreted correctly, the statistics tell us something else. It’s not a bigger problem here. And the problem is not a floating problem population that ends up in Vancouver. The biggest problem we have is a local lack of generosity leaving less shelter space and less housing available for those who need it in Vancouver. We can fix that. And we should.

  • Methodological note: While the Metro Vancouver count covers the entire metro area, the coverage of the Calgary and Winnipeg counts may be more constrained to the central cities of each metro area. This may result in a slight conservative bias, undercounting those who would show up in a homeless count in Calgary and Winnipeg covering the entire metro areas involved. At the same time, Calgary and Winnipeg dominate the populations of their metropolitan areas in a way which Vancouver, as a central city, does not. So I use metro populations as denominators in all cases in assessing the relative prevalence of homelessness in those cities relative to general populations and migration streams. I obtain comparative statistics on metro areas via StatsCan Tables 17-10-0136-01 ; 17-10-0135-01 ; 17-10-0141-01 for homeless count reference years, or, in the case of estimating migration-based risks, for the periods leading up to reference years. I use the data to estimate populations of non-migrants (stayers & local movers), intraprovincial, interprovincial, and international migrants for each metro to use as baselines for establishing risk of showing up in homeless counts. All data and calculations are available in this spreadsheet. Please send any corrections or questions my way!

Keeping the Leavers

co-authored by Jens von Bergmann and cross-posted at mountainmath

Do people select cities from diverse alternatives? Or do cities select residents from diverse flows of people?

The answer is pretty much: both.

People can look around and consider where they want to end up. And cities, through municipal policies, can and do work to select their residents. EXCEPT cities can’t do this directly. At least across North America, cities generally aren’t allowed to establish and maintain their own immigration policies. When they try to do so, the courts shoot them down, because both Canada and the USA enshrine the right of people to move within their borders. Cities can’t stop them. But cities have a big role in deciding how much room to make for people. And they also generally get to decide what form any added room should take. Many, for instance, only allow the most expensive forms of new housing, like single-family detached on large lots, selecting for wealthier residents. So that’s how cities select their residents.

The fact that it’s a two-way selection process, with both people and cities doing the selecting, makes it quite difficult to forecast something like future housing needed to prepare for a city’s population growth. Yet this is what cities, including Vancouver, are often tasked with doing by way of justifying their policies.

One way of going about this is to argue that past population growth is our best estimate to forecast future housing demand. This is a bad argument on many levels as we have explained at length before. In expensive gateway cities, like Vancouver, this often gets accompanied by nativist notions that population growth is driven almost entirely by international migration as net domestic migration is small. But net estimates obscure the actual size of flows, where local and domestic movers predominate and make up the majority of those occupying new housing.

More troubling is the implicit logic that elevates domestic in-migrants over international in-migrants, providing only the former a legitimate claim to the place freed up by a domestic out-migrant. So far, freedom for movement in Canada extends to immigrants, as it should. And not all immigrants come from outside of Canada. Increasingly non-permanent residents turn into immigrants (including both of us!) This simply results in a drop in net non-permanent residents and an increase in immigrants in these stats, without anyone actually moving. This speaks to the complexity of how cities select their residents from diverse flows of people. A thought experiment might be helpful to better illuminate how it works in practice.

Creating room for people to stay

First let’s look at past population growth. BC Stats splits this up neatly into several sub-categories, which we can think of as flows.

metro-van-migration-1

Net population growth for Metro Vancouver has hovered around 28k people a year. But it’s not like this is a one-way flow, about 50k people leave Metro Vancouver every year and somewhere around 75k people come. Some people have a really hard time making room for newcomers. But maybe people are more sympathetic to people leaving. Of course many people leave Metro Vancouver for greener pastures, a better job, move for university or other personal reasons. But the “Leaving Vancouver” letters (practically a genre at this point) are testament that not all people moving away think of their moves in positive terms. Many feel squeezed out. People keep talking about friends that left because they could not find adequate housing in Vancouver.

So let’s say, for the sake of argument, that one out of five people moving out of Metro Vancouver to elsewhere in Canada really wanted to stay but could not make it work. And, of course, we already know that feeling “forced” to move is strikingly common in Vancouver, even for those who remain. So let’s say we are sympathetic to the people who leave town and would actually like to insure enough room for them to stay. What would that take?

That’s easy to check, all we need to do is reduce the size of the inter- and intra-provincial out-migrant buckets in the above graph by 20%.

keeping-the-leavers-1

The net effect is that fewer people would have been leaving Metro Vancouver, while the same people came. And our population growth went up by about 30%. Which means that we should have built 30% more housing than we did over the years to make that possible.

Now some readers will argue that that’s not how things work. If we had built 30% more housing, that does not mean that one in five of the people that moved would have gotten to stay. Some of that housing would have been taken up by people that wanted to move to Metro Vancouver but could not find adequate housing, but with more housing they could have made it work and would have out-bid some of those that were hoping to stay.

And with more housing available, some new households might be created that might otherwise not exist. Maybe someone will move out of their parents place earlier and take up one of those new units without adding to population growth at all. And in return one of the 1 in 5 people that had hoped to stay might still end up feeling forced to leave again.

And people arguing that are of course exactly right. That’s the point of this exercise, housing and population growth are endogenous. Which is kind of a fancy way of saying that people select cities from diverse alternatives AND that cities select residents from diverse flows of people.

Empty homes – the ultimate anti-housing red herring

Here in Vancouver, those resisting making room for more people to stay and arrive like to point toward a supposed mismatch of housing growth to household growth between 2001 and 2016, supposedly leaving lots of empty homes. This time window is of course chosen deliberately to include the change in census methods 2001-2006, and this talking point mostly goes away when properly accounting for that. To avoid adding homes people will still point to some vague notion of dwellings being left empty, even though we have better data on empty homes than ever before and there are very few problematic cases paying the Empty Homes Tax or Speculation and Vacancy Tax left in the region.

How should we do population projections?

So given the endogeneity issues: how should we be doing future population projections? In high demand areas like Metro Vancouver we should start from housing growth. That’s what cities can control. How many condos will be built? How many rental homes? How many non-market homes? How many infill homes? And given a scenario of housing growth, we can model what population growth might look like. How many people would move here from elsewhere in BC? How many from elsewhere in Canada? How many from outside the country? How many people would move away? It’s not an exact science, but demographers can build decent models once we know how much housing is being built and how cities are trying to select their residents. And the public can look at different scenarios of housing growth and the resulting scenarios of population change and use that to have a more informed discussion about where they want the city to go as well as who they want to enable to stay.

As usual, the code for this post is available on GitHub for anyone to reproduce or adapt for their own purposes.

Lots for Sale

I’m currently enjoying Desmond Fitz-Gibbon’s Marketable Values: Inventing the Property Market in Modern Britain. It’s a fascinating book on how British real estate was transformed from estates granted and traded in private transactions bound by custom (think of landed nobility but also the Commons pre-enclosure) into something that could be bought and sold at auction and described in terms of a market, mostly over the course of the late 18th and 19th Centuries.

I was curious about this book for lots of reasons, not least because it seemed British property practices often spread to colonies, as in Canada. But as described by Fitz-Gibbon, this was actually a two-way street, and experiences in real estate at the peripheries of Empire also often informed practices back in England.

At any rate, the book and related projects have me re-examining the creation and marketing of properties here in Vancouver. Head on over to the Vancouver Archives and search for “lots” to have a look. We can see maps of surveyed properties to be sold and advertisements for the land that would become the City of Vancouver. Crucially, all of this property was created from unceded land claimed by the Crown in an enormous act of theft amid a series of pandemics spreading across BC’s First Nations. Locally, the Musqueam, Squamish, and Tsleil-Waututh held lands that were carved up into properties to be granted or sold by the Government of British Columbia.

Let’s take a look. The first lots for sale show up for the townsite of Granville in 1870, some 16 years prior to the (renamed) City of Vancouver’s incorporation (archival links: left, right). The lots, carved out of the government reserve, cover old Gastown between Carrall, Hastings, Cambie, and Water St. The latter remains mostly underwater in the map, but the surveyors imagined the future land that now extends beyond Water. Note the disregard for existing buildings outside of lot lines in the map! Several lots (circled) had already been sold or otherwise issued grants of ownership.

Lots1

 

By 1886, the railroad had been promised to the City, and in turn, Vancouver had been promised to the railroad. The Canadian Pacific Railroad (CPR) obtained enormous land grants from the province in downtown Vancouver, extending south across False Creek, in exchange for establishing their western terminus in the City. They made similar deals with nearby land owners, obtaining every third lot in the West End (famously pre-empted by the Three Greenhorns) and other districts nearby. The land was quickly cleared of trees and sold off in a speculative frenzy. One of the fires used to clear the brush famously ended up burning the whole city down shortly after its incorporation. But the clearing had to continue apace in order to sell off all the new properties being subdivided and marketed abroad.

Lots2

The maps above were printed using the same underlying survey and land subdivision plan, originally authored by CPR land commissioner Lauchlan Hamilton in 1887 (archival links: left, right), whose signature remains on each map (see more from Derek Hayes wonderful Historical Atlas of Vancouver). The more weathered map on the left is annotated and coloured to represent clearing status in 1887-1888, with lots in blue fully cleared, and lots in red just waiting the hauling off of lumber piles. On the right, the same underlying map has been turned into an international sales brochure by 1889, adding lots in Mount Pleasant and highlighting Vancouver’s location alongside travel lines and connections relative to Liverpool, Hong Kong, and Sydney.

The Provincial Government also got in on the sales, slowly releasing their own surveyed and subdivided holdings onto the market via auction. The lots auctioned below would ultimately become the Western third of Kitsilano, centred around McBride Park (archival links: left, right). Sales agents played up the advantageous location of subdivided lots and blocks within lot 540 near the CPR holdings, arguing that the CPR might install a port nearby.

Any Lot of Block not cross-lined on Map herewith, offered for Sale, WILL BE SOLD WITHOUT RESERVE – Adjoining this property the Canadian Pacific Railway Company have located their Docks, it being the nearest Ocean Shipping Point of Vancouver And the place Selected for the Commercial Traffic of the Trans-Pacific Fleet.

Joshua Davies, Auctioneer.

 

Lots3

 

Instead, of course, the CPR subdivided and sold off most of the nearby holdings within their land grant as well. The size of the grant, visible above and comprising roughly a quarter of the present-day City, says a great deal about why Vancouver’s often referred to as a “Company Town.” The company was the CPR, and its business was primarily real estate  (see further discussion in Doug Harris’s great piece on “A Railway, A City, and the Public Regulation of Private Property: CPR v. City of Vancouver“).

By 1906, some provincially owned lots remained for sale in District Lot 540. These were auctioned off with other provincially owned lots available in Hastings Townsite to the east and South Vancouver to the south and west (marked in red on left map below). Of note: western portions of South Vancouver would secede to form Point Grey in 1908, before ultimately reuniting in the amalgamated City Vancouver in 1929 (archival links: left, right).

Lots4

Provincially owned lots in the Hastings Townsite went up for auction again in 1909, as advertised in the map on the right. These were sold on the basis of their proximity to “important and extensive railway yards” associated with the Great Northern Railway and the prominent “99-foot” wide Renfrew Street. Times were given for transit options:

These lots can be reached on the 2:30 Great Northern Railway daily. After 1st April by the First Avenue B.C.E.R. cars, thence along Renfrew Street. Just here will be one of the most important suburban railway stations around the City. TERMS easy; one-fourth cash, BALANCE 6, 12, 18 and 24 months. INTEREST 7%.

Hastings Townsite would vote to amalgamate with the City of Vancouver in 1910. According to an advertisement for the vote in the Vancouver World (dug up by John Mackie):

At last women will have a voice in municipal affairs. On December 10th, if they are registered land owners, women will be able to cast a vote to say whether Hastings Townsite will be annexed by the City of Vancouver or not. In fact, everyone holding property in the said townsite will be given an opportunity. Anglo-Saxons, Orientals, Hindoos, and Africans alike, will be entitled to have a voice in such an important question.

Property ownership entitled owners to a vote in this particular municipal affair, potentially providing a voice to many groups, including most noted above, kept from voting by explicitly sexist and racist legislation at the time. Little wonder that immigrants and others facing discrimination have often devoted their energies toward purchasing property as soon as possible.

Of course, haters gonna hate. And exclusionary racists gonna discriminate by race. By 1927, the westernmost parts of Point Grey were subdivided and put up for sale. Westmount Park was advertised as The Subdivision Superb, an exclusive set of lots still tucked away North of 4th, just west of Blanca before the UBC Endowment Lands. Lots were sold not on the basis of nearby industry, but rather on beautiful views, nearness of beaches and golf courses and, perhaps most crucially, restrictions:

Realizing the necessity of guarding and conserving the character of the development of such a property as Westmount Park, the following restrictions have been placed on the sale of lots:

  1. For a period of 20 years, one residence only may be built on any one lot.
  2. No residence of a vale of less than $4,000 may be erected.
  3. No business or commercial building may be erected.
  4. No lots will or may be sold to Orientals.

In the Westmount subdivision we see covenants restricting properties to single-family residential uses directly tied up with classist and racist exclusion. A good reminder that real estate subdivision and sale simply left to the market was terrible at keeping out “undesirables.” The making of a truly exclusive neighbourhood required market restrictions and careful control over development. This particular version of “community not commodity” may have been quite useful to the exclusive agents at Orr-Hamilton Ltd. in selling the lots of Westmount Park (archival link to brochure below).

Lots5

On a happier note, let’s turn our attention to a bonus map from the Archives. Here we see Kitsilano Indian Reserve No. 6 still set aside on a map of lots in Vancouver in use from 1935 to 1940. Quoting Doug Harris, this was a time period more than twenty years after “…the City and Province induced the Squamish residents to leave the reserve” in 1913, but before “it was formally surrendered” in 1947 (p. 10). We also see the right-of-way forced through by the CPR long before this time. The Squamish reached a multi-million dollar settlement over the shady circumstances of the surrender of the Indian Reserve in 1999. Coming full-circle back to the railroad, in 2002 the Squamish won back the land that had earlier been taken as a right-of-way by the CPR. Of course this win happened only after the CPR, true to form, attempted to sell the land for redevelopment.

Lots6

So it is that the peculiarly shaped parcel of land pictured above – extending beneath and around the Burrard Bridge kind of like a big curvy triangle – was returned to the Squamish Nation (archival link). It’s now under development planning as Sen̓áḵw, a massive project aiming to create some 6,000 dwellings, largely much needed purpose-built rental, all tucked in around the Burrard Bridge. See detailed renderings here.

All in all, it’s way too easy to fall into the trap of naturalizing property as currently recognized on land titles in Vancouver. To forget how it was stolen in the midst of successive pandemics, marked off by survey line, written down on paper, then granted or sold off to the highest bidder. We need reminders. Which is one of many reasons to support the City of Vancouver Archives and all their wonderful digital imaging work. They’ve kept the receipts!

Why People Move in Canada & the USA: Comparing CHS, AHS, & CPS results

Why do people move? I’ve taken up this question in a series of recent posts (some co-authored), and though the available data to address the question remains sparse, it’s getting richer all the time. Today I want to compare three different sources of information, highlighting how much it matters just how we ask people about their reasons for moving.

The Canadian Housing Survey (CHS) is the newest source of information on reason for move. Its format borrows heavily from the American Housing Survey (AHS). But the Current Population Survey (CPS) also provides information on reason for move in the USA. Each survey asks about reason for move in slightly different ways.

In the USA, the CPS and the AHS ask about reason for move in different ways that might at first seem subtle, but have a big impact on results. The CPS tracks individuals, and asks where they lived one year ago. If they lived somewhere different from their current residence, they’re asked “what was your main reason for moving to this house?” This directs them to choose only one reason as their main reason, with options to specify reasons not on the list. The AHS, but contrast, tracks households, and asks only the reference person for the household if they moved in the last two years.  If so, they’re directed to a “recent movers” section, providing a little preamble and asking them repeated yes or no questions about their move, each of which might constitute one of multiple reasons to characterize their last move.

Reason4Move-A

There are a few major differences in these questions which I’ll detail in a moment, but one is worth talking about insofar as it’s especially subtle given its possible impact. Researchers often think of two separable but related processes as involved in moving. There are the “push” reasons you might leave a home and the “pull” reasons that might draw you to a new one. Reading the different questions carefully, the CPS clearly cues for “pull” reasons in specifying “reason for moving to this house.” The implicit comparison is “as compared to some other house” you might’ve moved to, rather than “why did you leave your old house.” The AHS more neutrally refers to moves overall, letting respondents sort through push or pull factors relevant to each option. I’ll come back to why this might be importantly in a moment. First let’s jump over to the Canadian Housing Survey question, which asks the responding member of each household about their previous residence and the move to their current residence, no matter how long ago it occurred.

Reason4Move-B

The set up is then quite similar to the AHS, except the CHS appears to provide all of the options at once instead of one at a time (people can still choose more than one). There is significant overlap (one might say “copying”) in the language of each option, though the CHS also provides a few extra options unavailable in the AHS, concerning moves for school, personal health, and to become a homeowner (all closely related to options available in the CPS).

Let’s quickly summarize major points of difference:

  1. individual (CPS) v. household (AHS, CHS)
  2. one-year (CPS) v. last move within two years (AHS) v. last move (CHS)
  3. different option lists (CPS, AHS, CHS)
  4. choose only “main” option (CPS) v. all relevant explanations (AHS, CHS)
  5. cued for place moving to (CPS) v. cued for many reasons for moving (AHS, CHS)

All of these differences create real problems for comparing results, but its also clear that the CHS and AHS are closest (rather than the CHS and CPS, which I’ve compared before). So let’s compare CHS (StatCan 46-10-0036-01) and AHS (Interactive Table) first. Here I’ll compare countries overall and also the four biggest metro areas within each country to get at some of the variation.

Reason4Move-C

The Canadian data is themed in the “cool” colors of blue, purple, and green, while the USA is in “hot” shades of red, orange, and yellow (“hot zone” references entirely unintentional, but perhaps apt). Here we see only the categories where AHS and CHS options map – almost identically – onto one another. For many options, the percentage of movers indicating the option at least partially explains their last move matches pretty closely. In particular, the “forced move;” “new job;” “change in household size;” and maybe “upgrade to bigger dwelling” all look like the AHS and CHS could plausibly be drawing upon the same distributions. But there are some big differences with the other options, with Americans reporting greater likelihood a move relates to “form own household;” “be closer to family;” “reduce commuting time;” “reduce housing cost;” and move to a “more desirable neighbourhood.” Are these real differences between countries or artifacts of the different surveys themselves?

Let’s zoom in on a few areas and add in the CPS comparison (here accessed via IPUMS for contemporary metro data) to provide more information. First up: forced moves!

Reason4Move-D

I’ve written about “forced moves” before, with special attention to those relating to landlords, banks and other financial institutions, and government actions in Canada and evictions and foreclosures in the USA. I puzzled over the differences between Canadian (CHS) and American (CPS) data. But looking across all surveys, we can see that the CHS and AHS data actually look very similar. It’s the CPS that seems to report an unusually low percentage of evictions and foreclosures rather than forced moves. So what’s happening? If one were reporting only the main “reason for move,” it would seem like being forced out of one’s previous residence would rise to the top, so it’s probably not just a matter of choosing a single “main” reason vs. multiple reasons. BUT let’s remember that the CPS also conditions peoples’ choices toward “pull” factors relating to the “main reason for moving to this house.” So CPS respondents are likely drawn toward considering why they ended up in their current residence, as opposed to other possible places they could’ve moved, rather than reporting on why they left their old place. Like I said, it’s a subtle difference in question wording, but here it probably has a big impact.

Returning to the AHS and CHS comparison, it looks like forced moves have been a little bit more common in the USA than in Canada, which matches with my rough expectations given differences in tenant protections, mortgage finance regimes, and economic turmoil. (If anything, I suspect these differences may become more stark, with more Americans experiencing forced moves as pandemic restrictions loosen). There remains big variation within each country, with Metro Vancouver topping forced moves in Canada and Chicago topping forced moves (and exceeding Metro Vancouver’s rate) in the USA. Of note, the CPS data is probably less reliable at distinguishing between Metros, but it’s notable that Chicago still stands out.

Let’s try moving for work!

Reason4Move-E

We can consider two different work-related options explaining moves: moving for a new job and moving to reduce commuting time. Interestingly, new jobs or job transfers account for more moves than reducing commutes in Toronto, Calgary, Vancouver, and Dallas. This is likely related to the high in-migration to these metro areas. Reducing commutes accounts for more moves in generally slower-growing metros (Montreal, NYC, LA, and Chicago). A notably smaller proportion of respondents in the CPS chose job transfer or reducing commute as the MAIN reason for moving to their current house, indicating lots of people considered a job-related move as likely just one of multiple reasons for moving – and possibly less related to why they chose a particular residence from multiple possibilities.

Let’s take a look at a suite of other, more housing-oriented reasons people might choose to move.

Reason4Move-I

“Form own household” as a reason to move is commonly thought of as capturing people like young adults (and/or divorcees) splitting off from existing households to start their own. This is a pretty regular demographic process, so it’s somewhat surprising that it seems to be related to so many more moves in the AHS than the CHS. Is this a Canadian-USA difference? Maybe, maybe not. Here the CHS and the CPS actually look more similar. What’s going on? One likely possibility is related to the fact that the AHS doesn’t have an option for people to choose “to become a homeowner” unlike both the CHS and the CPS. The closest SOUNDING option is “to form own home.” It seems entirely possible that this ambiguity in the meaning of “own home” – whether it means to become a homeowner or to separate from a previous household – explains much of the difference between the AHS results relative to both the CPS and the CHS.

Let’s compare moving for a larger dwelling with moving because of new household members.

Reason4Move-G

Change in household or family size and upgrading to a larger dwelling might be understood as related options. Again, very basic demographic processes – having children, partnering, etc. – often motivates a move to a larger home. Other demographic processes can result in smaller households, of course, but it’s less often people move in direct response. If a change in household size typically operates as a “push” (e.g. “this place is too small for us now”) then moving to a bigger dwelling operates as a “pull” (“this place is just right!”). What’s interesting here is that the CPS is predisposed to capture the “pull” part of this kind of move, and has no option at all for the “push” part. Perhaps as a result, here the CPS seems to “overperform” with “new or better home” as the MAIN reason for move almost reaching the prevalence of “upgrade to a larger of better dwelling” as one of many reasons for a move in the AHS.

Finally, let’s consider neighbourhood desirability and reduced housing costs

Reason4Move-H

Comparing the CHS and the AHS alone would make it appear that neighbourhood desirability is much more important as a reason for move in the USA than in Canada. We could spin all kinds of possible reasons for this (e.g. greater neighbourhood segregation and inequality in the USA). But adding information from the CPS reveals that moving for a better neighbourhood is very seldom the MAIN reason for a move. People mostly don’t move in search of better neighbourhoods, it’s just a kind of side feature. So maybe it doesn’t actually tell us much that Americans mention this feature more often as describing their reason for moving (when presented with it as a “yes/no” option) than Canadians (provided as one of many options). By contrast, the CPS results more closely track both the AHS results (which still run higher) and the CHS results for moving to cheaper housing as a reason for moving.

LONG STORY SHORT: every move is a story in itself. We only partially capture this story with survey questions about why people move, and how we structure those survey questions really matters for the results we get. Compare with caution!

Projections and Self-Fulfilling Prophecies

jointly authored with Jens von Bergmann at MountainMath

 

When people want to live in your city, how many should you let in? On the one hand, this is a moral question. Do you have an obligation to people who don’t already live here? On the other hand, it’s a moot question. At least in Canada, cities don’t have the power to control migration.

BUT WAIT! Cities DO have power over how many new dwellings to allow. This actually changes our moral question a bit. Cities can’t keep people out, but because they have power over dwellings, municipalities can control how many people get to remain in. As a result, if you don’t allow any new dwellings when people want to live in your city then rich people will generally outbid poor people for the housing that’s left.

It may be the case that municipal politicians are fine with rich folk replacing the poor folk in their cities while their own housing rapidly appreciates in price. Why let any new housing get built? “No thanks, we’re full!” But they can’t always SAY this. Especially in cities full of renters that generally support progressive and inclusive values.

So what to do? Two paths are readily available. One: transform the moral question (“isn’t it terrible that developers make money off building housing?”) Two: turn the moral question into a narrow technocratic one instead. Let’s explore this latter option a bit more, because it’s really interesting and sits well within our wheelhouse (mathematician and demographer).

Here in the City of Vancouver, a new motion was just launched, titled Recalibrating the Vancouver Housing Strategy (RVHS). There are some good initiatives in this motion, but the main thrust and motivation is to turn the moral question of how many people get to remain in Vancouver into the narrow technocratic question of how do we forecast population growth? As any demographer can tell you, this can be tricky, especially when it comes to forecasting for municipalities. But there’s a naive kind of work-around some people use when they don’t follow demographic techniques and concerns very closely and don’t want to think too hard about the question at hand. They simply turn the population forecast into a projection forward from how a city grew in the past.

This is a neat trick! Especially if you’re in a city that’s limited new dwellings in the past and thereby kept its population growth to a minimum and you want to keep it that way. “The evidence suggests we haven’t been growing very fast, so we shouldn’t add much more housing.” With a little bit of hand-waving, the number of dwellings allowed by the city is reimagined as something that can be tailored to meet the forecast rather than the central determinative factor of the forecast.

Is this the kind of thing that could happen in Vancouver? Before we get into the motion, let’s just quickly look at Vancouver’s recent past. We know prices and rents rose rapidly through 2016 (and beyond), which is pretty good evidence that we didn’t add enough housing for the people who wanted to live here all by itself. But how did the City of Vancouver grow relative to the rest of the region? It grew more slowly. (“No thanks! We’re full!”) Did we lose poor people and replace them with rich people as a result? Yap, this is exactly what has happend in the City of Vancouver, which has lost lower and middle income people, and gained high-income people, at a faster pace than the surrounding Metro area.

2005-2015_rel_change-1

 

The Motion

Now let’s get back to that RVHS motion, starting with part A:

THAT Council direct staff to revisit the Housing Vancouver Strategy targets to align with historical and projected population growth based on census data.

This is a vague statement. There are, of course, many ways to “align” something (Dungeons and Dragons fans may be immediately reminded of the nine different alignments readily found therein). There are also many ways to project population growth. These often rely upon multiple sources of data. Birth rates, death rates, age structure, labour market statistics, and net migration rates serve as typical baseline sources of information for demographers, and are usually gathered from all manner of data (e.g. vital statistics, surveys, policy-based immigration projections, etc.) rather than simply historical census data. So how is the author of this particular motion imagining more specific alignments and projections? The answer can probably be found in the WHEREAS sections 4 and 5:

Population growth has been consistent at approximately 1% per annum over the past 20 years according to Statistics Canada census data. Based on this historical trend, a similar growth rate for the coming decade would amount to a population increase of around 66,000. In the City of Vancouver, the average household size is 2.2 individuals per dwelling unit (or “home”);

The target of 72,000 new homes across Vancouver in the next 10 years multiplied by 2.2 would mean a population increase of 158,400 – more than twice the historical rate. A projected historical rate of population growth would imply instead a need for roughly 30,000 new housing units over the coming decade;

We’ve left the refined techniques of demography behind here, as well as the determinative forces of births, deaths, and moves. Indeed, people pretty much disappear and their dwellings get only scare-quotes as homes. But let’s follow the math we do get and try and understand what projecting past trends means in terms of numbers (leaving aside if we agree that things went splendid and we should just keep going the same way). Let’s try and reproduce the estimation of new housing units assuming we hold the 20 year trends in the two mentioned metrics, population and household size, constant.

The 1% annual growth rate roughly checks out, although there have been variations.

cov-vs-metro-pop-growth-1

 

And population in the City has grown consistently at a lower rate than overall Metro Vancouver population. In fact, if the City of Vancouver had grown at the same rate as Metro Vancouver over those 20 years, Vancouver would have had 60,000 more people within city limits in 2016. But maybe people would just rather live farther out in the surrounding suburbs? Again, there are variations, but overall that is not what the price and rent data tell us.

rent-unnamed-chunk-3-1

 

People want to live in Vancouver. But they often settle for living farther out, based on the specifics of what they want and can afford. The competition for the limited number of dwellings in Vancouver drives up prices here relative to surrounding municipalities.

So what to make of the close relationship between population growth and dwelling units added? It’s a real relationship.

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The motion, as presented, seems to suggest that this close relationship is evidence that we’re projecting population growth really well, thereby allowing almost perfectly enough new housing to meet population needs. Is this what we’re doing? Well, no. In fact, the amount of new housing allowed sets a cap on population growth that can only be exceeded by increasing household size (which in many cases cities have also made illegal)1 or decreasing the number of empty dwellings.

There is broad support for decreasing the number of empty dwellings, and both the City of Vancouver and the Province of British Columbia have put in place taxes on vacant properties and their owners to do just that. Have they succeeded? Quite possibly! But compared to other municipalities, Vancouver’s vacancies (as recorded in the Census) looked relatively normal prior to the new taxes, despite persistent rumours of some mythical oversupply. After the new taxes, administrative data reveals there aren’t many taxable units left vacant at all (~1%).

What about household size? The motion suggests imposing a constant for Vancouver, expecting 2.2 people per household. But household size is not staying constant. It’s falling all across Canada, due to a combination of forces (aging of the population, declining childbearing, changes in partnership, the rise of people living alone). We also know that as people get richer, they tend to occupy more space. And, as pointed out above, Vancouver’s been getting richer.

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As we see, household size in the City of Vancouver has continuously declined over the years, a trend that has significant impact on the relationship between housing and population growth. Sticking with the bad assumption that past population growth should be predictive of future housing needs, we can see that we’re still going to need more housing per person than in the past. Projecting these trends forward, lazily anchored at the 2016 census data, gives an increase in population in private households of about 67,000 and a corresponding increase in 41,000 households (aka occupied dwelling units). And that is not yet accounting for the increase in population in non-private households that Vancouver has experienced, like retirement homes or similar institutional housing.

So if the RVHS motion points us toward a bad way to do population projections, then how should one do it? There are lots of models to look at, but given that people want to live in Vancouver, a key ingredient in any model should be how much housing will be allowed. Conditional on allowing a given amount of housing, we can attempt to forecast how many people will come. But this moves us back from narrow technical questions (which we’re more than happy to continue exploring in depth!) toward the central moral question at hand. How many people are we comfortable allowing to live in Vancouver? Because if we allow more housing, more people will come. And if we allow more housing, we’ll also allow more of those currently at risk of feeling unwanted in Vancouver to stay.

That begs the question: What would be the problem with allowing more housing? The last WHEREAS of the RVHS motion holds an answer to that.

A revised and more accurate understanding of demographic needs and demand will assist in properly planning for the post COVID-19 reality. Setting excessively high targets will pressure the City of Vancouver to grant significant amounts of density at a low price, in an attempt to induce housing construction approaching the HVS targets. This will cost the City of Vancouver potential revenue, and will mean that the City abandons its commitment to having growth pay for itself.

In short, housing might get cheaper. Which incidentally is quite in line the goals of the Vancouver Housing Strategy.

But there are a couple things here that need a bit more unpacking. First, from the title throughout the motion and showing up here again are mentions of planning for a “post COVID-19 reality.” To put it bluntly, this is odd. These parts of the motion caution us against assuming what comes next will reflect what came before. But, as discussed above, this is exactly the assumption the rest of the motion says we should make, resting as it does upon a very selective reading of Vancouver’s recent population growth. Weird contradiction. But then again, pretty much the same language has been employed way before COVID-19 was on anyone’s radar, suggesting that COVID-19 has just been tacked on for extra effect.

Second, the notion that “growth pay for itself” sounds quite reasonable, but it’s not clear what that means in practice. In Vancouver, new housing projects pay a variety of municipal fees, DCLs, CACs and additional engineering fees upfront, and annual property taxes thereafter. How much of the overall cost of living in the city should be charged upfront, and how much should be charged over the lifetime of the housing as property taxes? That’s a political question that Vancouver should have a discussion on.

Charging high entry fees keeps prices high, not just of new housing but of all housing. It encourages treating housing as an investment, with low holding costs (property taxes) and high barriers to increasing housing even as population pressures keep prices and rents rising.

Charging a lower entry tax and collecting a higher portion as property taxes later can lower the entry point to housing and spreads the costs out over the lifetime of the dwelling unit. This treats housing as a place to live, lowering the barriers to new housing construction and asking people to pay for city services and amenities over their time living in the city.

The (sort of) good parts of the motion

Let’s end with a few bright notes. There are some good parts to the motion! We like data and Part B asks:

THAT Council direct staff to provide annual historical data since 2000 on the number of units approved through rezoning, the breakdown of housing types that have been approved, housing starts and net housing completions, and estimated zoned capacity for the City of Vancouver.

This part of the motion is asking for better data, but it needs refinement. As it is right now it is hard to see what it will accomplish.

Number of units approved through rezoning is hard to interpret unless it is accompanied by more detail on how many of these units actually got built. Take the approved first version of the Oakridge development for example. A massive number of units got approved, yet the project died when drilling found an aquifer that precluded the project from going forward as approved. Several years later, a different proposal got approved, for the data on approvals to be useful we need to know what happened to those units.

Monthly data on housing starts is already easily available, asking the data be reproduced adds zero value and amounts to a waste of staff time.

Net housing completions is an important number, but very hard to do in Vancouver, given our high reliance on informal housing. It is still worthwhile to try and approximate this, but the motion should be clearer what part staff should focus on beyond the data on completions, demolitions and secondary suite estimates that we already have.

Estimates of zoned capacity is a great stat to get clarity on. Some vague estimate has been making the rounds for a while after surfacing in a consultant report, with next to no detail how it was derived. Having an estimate with a clear methodology would be a great addition to inform Vancouver housing policies.

Part B is a good and simple ask:

THAT Council direct staff to clarify whether the Vancouver Housing Strategy targets refer to net housing completions or gross housing completions.

Part E is mostly redundant:

THAT Council direct staff to provide detailed inventory data through the Open Data Portal4 of housing starts, development projects anticipated in the pipeline (including form and type of units), and existing zoned capacity (disaggregated by local area) to inform this work.

The open data portal already has detailed information on housing units in the pipeline. The information could be improved, but this ask is useless unless it specified how. As mentioned before, detailed information on housing starts is already easily available as open data, monthly stats by structural type and intended market, down to the census tract level. It is less helpful than the other parts above and risks directing staff resources away from other project just to replicate what’s already out there.

Bottom line

There’s no way around it. How many dwellings to allow in a city is ultimately a moral question rather than a technocratic one. Given the overwhelming evidence that people want to live in places like Vancouver, population forecasts necessarily reflect first and foremost how many new dwellings we’re willing to allow. In technical terms, it’s silly to imagine we’re meeting the needs of population growth when we’re in fact setting a hard cap on population growth. In moral terms, we come back to the central question: Are we planning for kicking poor people out? Or are we open to inviting more people in?

As usual, the code underlying the stats and graphs is available on GitHub for anyone to reproduce or appropriate for their own use. And if you want to read (much) more about how to know if you have enough housing, check our simple metrics post.


  1. For example the City of of Vancouver only allows at most one kitchen per dwelling unit and limits the number of unrelated individuals sharing a dwelling to 3 (+ 2 boarders or lodgers) to restrict sharing of homes. [return]

How many owner-occupiers can already defer their Property Taxes in BC?

We’re rolling around to property tax time, and municipalities are about to feel the COVID-19 crunch. The Mayors of Metro Vancouver have been leading an ask of the province to backstop municipal finances given that many residents and businesses may fail to pay their property taxes. Indeed, the City of Vancouver recently commissioned a survey indicating that due to job and income losses, some 25% of home owners in the city would be paying less than half of their 2020 property tax bills.

One ask from the Metro Mayors is for the province to expand it’s property tax deferral program to cover those not currently included. As they advocate:

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This, of course, is a big ask! But just how big? Here I want to separate out the ask for businesses and non-profits (where the ask is very big indeed), and focus on homeowners. And after all, homeowners are where the City has focused its survey. So how many homeowners are not currently covered by provincial tax deferment options?

There are two programs covered under provincial tax deferment: the regular program and the program for families with children. The regular program is open to any property owners (of a primary residence) over the age of 55, as well as surviving spouses (of any age) and persons with disabilities. The province effectively puts a lien on your property to secure the debt and charges 1.95% interest on outstanding taxes owed. The families with children program is open to anyone living with or supporting children under age 18, or children enrolled in education (e.g. university), or children with disabilities of any age, and the interest charged under this program (3.95%) is higher.

Just focusing on the two main groups covered, homeowners age 55+ and families with children, we can draw upon census data from 2016 to roughly estimate how many owner-occupied households are likely covered by existing tax deferment options. The answer: the vast majority, over four-in-five. Why? Because home owners are especially likely to be old or have children. Here are owner-occupier households in BC by age of primary maintainer and presence of children*:

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Overall this is good news! Most resident homeowners in BC are already covered under property tax deferment options. And the province will likely see a big uptake in deferments this year through existing programs. But those who fail to qualify also deserve provincial attention. And, of course, renters deserve a lot more attention too. I’d argue that it’s also well worth supporting expansion of the property tax deferral program more broadly since this also supports municipal finances at a very trying time. Moreover, if the province expands the program at family program interest rates, it may also help support provincial coffers down the road.

 

*- Here I lump the relatively tiny set of multiple family households into those without children, following the general household type categorization. See StatCan Table 98-400-X2016226 to play around with your own operationalizations.

So are you two a couple now? Asking for the BC Government

BC has been lauded for rolling out an assistance program for renters, unlike basically every other province. At the same time, BC’s also been criticized for the perceived inadequacy of that rental assistance program, as well as the fact that it literally goes straight to landlords. In conjunction with the temporary eviction moratorium, it would appear that the BC Temporary Rental Supplement (BC-TRS) is really aimed at supporting landlord incomes and easing tenant-landlord relations to avoid a rash of evictions once the moratorium has been lifted.

Here I want to question another aspect of the program, at least as we’ve seen it so far: What’s it got against couples?

The BC Temporary Rental Supplement, as announced today, provides $300 per single person or couple household, and $500 per household with dependents. But roommates can apply separately for benefits, and it would appear each roommate is eligible for a $300 or (if living with a dependent) $500 rent supplement. Here are relevant items from the FAQ:*

Rental_Assist_1This means the “household” definition being applied by the province – whereby roommates constitute separate households – best matches the “family” definition of the Census, whereby family is defined by a couple (married or common-law) or parent-child relationship. The Census considers roommates as members of the same household, but unrelated, and hence not members of a family.

Why does it matter? Well, what’s the distinction between roommates and a couple?** Because if you’re a COUPLE you max out at a $500 benefit with children or a $300 benefit without. But if you’re ROOMMATES, it appears you qualify for $300 each, or more if there are children involved, maxing you out at $600+. In effect, couples have their status turned against them in terms of government benefits.

Interestingly, this isn’t the first time the current BC government has zeroed in on couple status as a determinant of less than favorable policy treatment. The BC Speculation and Vacancy Tax hinges upon marital status in terms of whether overseas partner incomes get counted toward family incomes, distinguishing “satellite families” hit with higher property taxes from everyone else. In effect, if you own a home this is a huge disincentive for formalizing, declaring, or maintaining transnational relationships, at least if your partner potentially earns more than you. BC tax policy says it’s better for you to split up than stay coupled with anyone outside of Canada, just as BC renter support policies seem to tell us it’s better to be single (with a roommate) than part of a couple.

One way of looking at the government position on rentals is that couples might be considered more resilient than singles. So singles, including roommates as well as single parents (who get $500), need more help and more allowances. And as I wrote previously, with respect to rental supports this might well be correct. Singles and single parents make up the bulk of those in core housing need. I’m happy that the BC government is providing special help to those with dependents, even if I wish the amounts were higher.

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It’s also the case, as in my past research auditing rental listings, that BC’s tipping of the scales against renting couples might actually counteract some of the beneficial treatment they usually receive in the rental market, where landlords tend to discriminate against single parents and some same-sex couples (who may, in some cases, have been taken for roommates). Finally, policy is being rolled out at a ridiculously fast speed, which is important and a success in its own right because people are in need of money now. But that speed is bound to come at a cost in terms of care in crafting policies. We’ll see plenty of mistakes and unintended consequences of fast policy roll-out in the days to come. We shouldn’t forget the urgency behind the roll-out, even as we offer up critiques and fixes.

That said, we’re left with a fun contrast. If Pierre Trudeau famously declared “there’s no place for the state in the bedrooms of the nation,” the government of BC still wants to know: are you two an item?

 

UPDATE (Apr 12, 2020):  Another interpretation (in this case my partner’s) is that the BC – TRS is geared entirely toward assumptions about how many bedrooms different kinds of households need and what the associated costs might be. The logic being that couples might only need 1BR, whereas parents with children need at least a 2BR, and roommates are (ironically) assumed to sleep in separate bedrooms, also requiring at least a 2BR. This interpretation actually mirrors the logic of the Canadian National Occupancy Standards defining the suitability aspect of the Core Housing Needs measure. Accordingly, BC-TRS payments could be designed simply to go up in response to anticipated bedroom need. I like this interpretation a lot, so I thought I’d share it too! (I hinted at the importance of considering bedroom need in my previous post on the renter benefit, only I didn’t think they’d adopt the couple assumption from the National Occupancy Standards, which I’ve also researched in the past! Kicking myself a little that I didn’t think of this interpretation first, but also patting myself on the back for settling down with someone more clever than me…)

 

*- Yeah, also your adult kids don’t qualify as roommates (item 18) and you don’t get any assistance if your landlord is also a family member (item 19).

**- As it happens, I asked just this question in my dissertation… though from a viewpoint embedded within demography (i.e. are people more likely to cohabit with an unmarried partner in response to housing shortages, making them like roommates, or less likely, making them act more like married couples?) In the context of Swedish demography, easier access to housing meant greater likelihood of cohabitation, providing evidence that cohabiting couples tended to be acting more like married couples than economizing roommates. BUT, there’s a lot of grey in there. Especially insofar as we usually leave it to people to define their own relationships.