Housing

Deanna Steele says she has never seen as many condo and vacation homes for sale in Kelowna, B.C. as she has this month.

The founder of Keys to Kelowna Properties Inc., a luxury vacation rental management agency, said the lake-front city's real estate market is "saturated'' by properties zoned for short-term rental use. Some of the sellers are people who bought not that long ago and are already trying to get out.

"They thought they were going to make a mint because they saw what was happening in the gold rush. And now they're realizing, 'Oh, big mistake,'" said Steele.

That gold rush — investing in short-term rentals in Kelowna and many other Canadian cities — could potentially slow to a trickle in the wake of new legislation to regulate short-term rentals introduced by the B.C. government in mid-October.

On 20 September 2023, the Victorian Government released its Housing Statement – a major package of government investment and reforms in housing.

Part of the plan is to demolish significant public housing estates across the state, including all 44 public housing towers across Melbourne by 2051. According to The Age, the 10,000 public housing residents were informed of the decision by Homes Victoria via leaflets the day after the announcement.

At this stage it is intended that the public housing towers in Carlton, North Melbourne and Flemington will be replaced with 30,000 new dwellings, of which only 11,000 will be earmarked for social housing. The remaining 19,000 dwellings will be private housing.

According to the State Government, the towers are ‘no longer fit for modern living’ and are unable to be retrofitted and therefore need to be demolished. However, leading experts from the RMIT Centre for Urban Research argue that there is no publicly available evidence to support this proposition and that demolishing the towers will in fact likely add further to the current shortage of public housing. Demolition will displace the closely-linked refugee and migrant communities that have called these estates home for years. 

Australia is in the grip of a “bankocracy”, in which four banks control our access to money. Their profits, and therefore the salaries of their executives, depend on both the volume and the value of their assets growing.

The volume of their assets (that is, the number of loans) increases because Australians believe the only way to increase their wealth is to borrow 80 per cent to 100 per cent of the value of one or more houses. And the value grows because the banks’ customers compete with each other to buy the houses and push up their prices and therefore the size of their loans.

The more house prices rise, the greater the banks’ profits. As US investment guru Charlie Munger says: “Show me the incentive and I’ll show you the outcome.”

The way real estate works in Australia is that the federal government and banks encourage demand for it while state and local governments restrict the supply of it.

It’s not just that renters are in the minority – some minorities have real power – but the nation’s attitude to housing is deeply ambivalent and well hidden. There has been, and still is, a public dialogue about the problem of housing affordability and plenty of sympathy expressed for the disenfranchised, but the majority who own a house are quietly happy with their high prices, and economists and businesspeople approve of the economic “wealth effect”. Also, the minority who don’t own a house talk about the property ladder and the need to get on it. The idea of housing as the main, if not the only, form of real wealth creation for ordinary people is deeply embedded in the national psyche. Superannuation is starting to rival it but is still a long way behind.

That means doing something about it requires true political leadership – that is, doing something right that’s unpopular. Study after study on the subject has concluded that the high price of housing is leading to dangerous inequality and distorting the economy and society, yet political leaders have never tackled it effectively, for obvious reasons.

The fact that one of the three least-populated countries on earth contains the world’s second-most expensive housing is a national calamity and a stunning failure of public policy. For decades, political leaders have paid lip service to housing affordability, while doing nothing that would bring prices down. In fact, most of the big political decisions have done the opposite.

While some blame supply shortages or overseas investors, the primary factor contributing to this crisis is the outsized role of investment properties. Too many individuals and corporations have purchased properties solely for investment purposes, driving up prices and exacerbating the shortage of affordable housing. These investment properties sit idle or are rented out at exorbitant prices, and regular citizens can no longer find affordable homes.

The housing crisis is both an economic and a human rights issue. Housing is a basic necessity for life, health, and dignity. When treated as a speculative financial asset rather than a social good, inequality grows, and vulnerable populations suffer.

To address this crisis, we need bold solutions that answer the scale of the problem. By implementing progressive taxation, incentivizing the conversion of investment properties, and introducing anti-speculation regulations, there is a path to revolutionize the housing market and make affordable housing a reality for all. But it’s going to take fundamental, uncomfortable and unpopular change. Band-aid fixes and minor policy tweaks will not cut it.

In recent decades, many Sun Belt cities—like Atlanta, Houston, and Phoenix—have seen growing populations, while populations have tended to remain stable or decrease in places in the Midwest or Northeast—like Chicago, Detroit, and Pittsburgh.

But despite their lack of population growth, Chicago, Detroit, and Pittsburgh have been gaining households in recent years. In Chicago, the population has remained stable, but the number of households has increased by 6.2 percent. In Detroit, while population dropped 5.5 percent between 2010 and 2018, the number of households has increased by 4.4 percent. And in Pittsburgh, even though the population dipped during the same period, the number of households increased by 9.3 percent.

This issue of Interface, on community housing models, speaks directly to the contrast of increasing luxury and corresponding prices on one hand, and displacement on the other. Taking up the question of what is needed to support, sustain, and expand the non-market-driven housing sector, the papers provide insight into housing provided through community leadership and cooperative ownership models. Each author in this Interface is an experienced practitioner and researcher. They are writing from the Anglo-American perspective – England, the UK, Canada, and the US – facing housing systems that are inadequate to the level of need for secure and affordable housing access.

The reflections in this Interface seek to define the core elements of community housing and to illustrate the diversity of its forms and its aims. The papers suggest that rationales for community-led housing are found in a wide range of ideological positions – from revolutionary and anti-colonial, to seeking equitable participation in democracy, to mainstream cost-benefit analyses of the benefits of this form of affordable housing provision. All, however, agree that at the core is the leadership and enfranchisement of the people living in the community, in housing that is not buffeted by market forces.

The limited number of existing units, combined with low turnover rates, make co-op housing an unviable option for most Canadians, despite being so in-demand.

Consequently, since market landlords aren’t competing against the affordability of co-op housing, they are free to jack rents as high as the market will bear, Thomas said. She points to pressure from industry lobbying the government against investing in non-market housing.

Geordie Dent, executive director of the Federation of Metro Tenants' Associations in Toronto, told Ricochet that’s an accurate assessment of what happened behind the scenes, that lobbying by landlords certainly played a key role.

“I don't think anyone ever came out publicly and said that,” he said. “It was always pitched as ‘market efficiency’ to the public, while I think privately, a bunch of landlords realized they were going to make a ton of money down the road. The government just swallowed everything they said and they didn't care if it was true or not.”

Nearly 160,000 people are living in hidden, often overcrowded and sometimes dangerous bedsit-style accommodation across England, analysis has found.

Intelligence compiled by councils suggests there are almost 32,000 unlicensed large houses in multiple occupation (HMOs). These are believed to be home to at least 159,340 tenants, who are often drawn by cheaper rents amid the cost of living crisis.

Conditions can be dire, with examples of more than 10 people sharing a single bathroom, squalid conditions and little protection in place should a fire break out.

Landlords have doubled their borrowing to invest in HMOs since 2018. A landlord renting to a single family can expect to generate 5% of the property’s value in annual rent, whereas a licensed HMO typically produces about 7.5%, and in some cases 10%. Profits in unlicensed bedsits are likely to be even higher, as landlords can cram in more tenants and do not have to comply with licensing standards.

The proposed development will include 129 studio apartments for low-income people and those experiencing homelessness. A minimum of 50 per cent of units will be held for people who are currently homeless and on income assistance, with the other half for people earning earning between $15,000 and $30,000 per year.

More than 200 people signed up to speak to the city’s public hearing, with emotions high on both sides. Opponents argued the project was a “failed model of housing,” that would “warehouse” a high-proportion of proposed residents with complex issues. Opponents also raised concern about nearby schools.

Thursday’s ruling un-pauses the original judicial review application against the city, which was suspended in September pending the outcome of the MEVA 5 challenge.