The Stories We Explored in 2014
As many of you know, Urban Futures' goal is to produce thought-provoking research that sheds light on how communities are growing and changing and make that information publicly-available so better decisions can be made. This past year was no exception, as numerous reports, interviews, newspaper articles, and presentations filled our schedules. As we close out 2014 and look forward to 2015, we wanted to highlight some of the data, research, and presentations that occupied our time here at Urban Futures through the past year.
Our consulting work in 2014 gave us the opportunity to engage a wide variety of clients, from the private sector to non-profits. Our research supported the work of the Canada Pension Plan Investment Board, BC’s Ministry of Natural Gas Development, BC's Capital Regional District, GWL Realty Advisors, the Immigrant Employment Council of British Columbia, the New Westminster Economic Forum, the North Peace Economic Development Commission, Rennie & Associates, Townline Homes, UBC Community & Campus Planning, BC's Ministry of Transportation, and BC Investment Management Corporation, among many others.
On the non-profit research side, we published eight publicly-accessible reports to our website, on topics ranging from international merchandise sales to the local and national housing market:
Canada Housing Series & the Toronto Real Estate Forum
Can you read this? 139,230 people in Metro Vancouver can
Averages & Anecdotes: Trends in Home Ownership Rates in Canada & Greater Vancouver
Where have the jobs been going in the Lower Mainland?
Two Data Points Don’t Make a Trend But...
Trends in BC’s International Merchandise Sales: 1993-2013
People & Jobs in British Columbia’s Future: A Scenario for BC’s Labour Market to 2041
Trends in Lower Mainland Housing Prices: A 2013 Sales Update
In an effort to make sometimes cumbersome data more engaging and accessible, this past year also saw us create of a host of reference and thematic maps for public use. These maps (available here) present data and information on population, the housing market, and the economy for provinces and communities across Canada. We encourage you to go click around and explore! Expect to see many more maps and other interactive graphics in the coming year as we continue to think about new ways of visualizing data.
On the speaking front, Andrew and Ryan spent a significant amount of time on the road this year, giving customized presentations to a wide range of audiences and events. Some highlights include:
January 30 - Fraser Valley Real Estate Board Conference & Trade Show
February 3 - Economic Outlook Breakfast, Pinton Forrest & Madden Executive Search
February 27 - Surrey Regional Economic Summit
March 28 - Mind the Gap — 2014 IECBC Summit
April 10 - Meeting Professionals International
April 11 - Credit Union Central of Alberta
April 24 - UDI Okanagan Luncheon
May 2 - College of Licensed Practical Nurses of Alberta Conference
May 14 - BC Land Summit
May 26 - City of Lethbridge
June 18 - Economic Development Lethbridge
August 5 - Vancouver Board of Trade
August 12 - Rennie Marketing Systems
September 9 - Fraser Valley Economic Summit
September 23 - Union of BC Municipalities
October 2 - New Westminster Economic Forum
October 3 - Chilliwack Moving Forward Event, Chilliwack and District Real Estate Board
October 23 - Canadata Construction Industry Forecasts Conference West
November 6 - Price Waterhouse Cooper’s Western Canada Private Company Conference
November 7 - Strathcona County Community Leadership Series
November 20 - Canadian Association of Fairs and Exhibitions
November 25 - Townline Homes
December 2 - Toronto Real Estate Forum
December 5 - Port Metro Vancouver
Finally, with 2014 winding down, we thought it would be a good idea to provide a quick review what we felt were the top four story lines that emerged in 2014. While some topics will (hopefully) fade through 2015, others will certainly continue to persist through next year and beyond. Our top 2014 pics were:
- Temporary Foreign Workers
- Unoccupied Homes
- Housing Affordability
- Transit & Transportation
1 Temporary Foreign Workers
Earlier this year, issues regarding the treatment of Temporary Foreign Workers (TFWs) by employers, employers’ use of the TFW program to procure lower skilled/lower paid workers in specific sectors, and lax government oversight of the Labour Market Opinion process came under scrutiny. The public backlash led to reforms to the program, including an immediate moratorium on the food services sector’s access to the program, with more changes expected to come in 2015.
Having had a chance to look closely at the number of international migrants coming to BC over the past two decades, the highlight for us was the fact that despite rapid growth in temporary residents over the past decade (including students, workers, and others), BC’s share of Canada’s temporary residents, as well as immigrants arriving as permanent residents, has been in decline.
The number of temporary residents has certainly grown as a share of BC’s total international migration, from 66 percent in 2002 (65,320 temporary residents) to 77 percent in 2012 (92,225). That said, while BC has seen its annual number of temporary residents grow by 41 percent over the past decade, BC’s share of Canada’s temporary residents has declined from ten to eight percent. Similarly, while the annual flow of immigrants to BC has grown from 34,055 in 2002 to 36,240 in 2012 (a six percent increase), immigration to BC did not kept pace with the 13 percent increase Canada-wide. Hence, BC’s share of Canada’s immigrants has declined, going from 15 percent in 2002 to 14 percent in 2012.
From a labour force planning perspective, British Columbia’s declining share of Canada’s immigrants and temporary workers raises concerns over BC’s ability to achieve international worker targets prescribed in the province’s labour supply plan. As policy makers strive to prevent abuses of the immigration system, they must also oversee the evolution of an immigration system that helps maintain BC (and Canada) as a competitive destination for international migrants.
Click here to read the more detailed research that we produced for the Immigrant Employment Council of BC earlier this year.
2 Unoccupied Homes
Another topic that attracted significant attention in 2014—at least in BC's Lower Mainland—was the perceived prevalence of both unoccupied dwellings and foreign investment in residential markets. The chatter even inspired the launch of a blog identifying properties that seem to sit empty throughout Greater Vancouver, and one City of Vancouver mayoral candidate to propose a tax on vacant homes. While anecdotes and opinions on the issue litter the web, the reality is that there are no comprehensive publicly available data to track foreign ownership of residential properties in Canada. When sending out Census forms, Statistics Canada and the local Census enumerators do, however, track the number of unoccupied units.
To clear up some controversy, an average of 4.8 percent of the private dwelling stock in Canada’s 33 CMAs were unoccupied at the time of the 2011 Census. With a 5.4 percent level of unoccupied units, the Vancouver CMA sat slightly above the national CMA average, but the difference was slight when compared to other CMAs, such as Victoria (at 7.5 percent), London and Windsor (6.9 percent), and St. Catherines/Niagara and Sherbrooke (both at 6.8 percent). Looking specifically at the apartment market, unoccupied units in the Vancouver CMA accounted for 6.2 percent of all apartments here, below the 7.0 percent average for all 33 of the CMAs in Canada. Sub-regionally, unoccupied apartments accounted for a slightly above-average share in the City of Vancouver (6.7 percent) and West Vancouver (6.9 percent), and well above-average shares in Pitt Meadows (8.7 percent), Surrey (9.2 percent), and in the UBC/UEL area (10.1 percent).
Census data on private dwellings occupied by persons whose primary residences are elsewhere in Canada or abroad can serve as a proxy for dwellings occupied by foreign/temporary residents. While much is made of the "foreign" segment of this group, the term foreign/temporary residents is a much broader classification that includes students, tourists, workers, family visitors, entertainers, and professional athletes living here, but who report a principal residence elsewhere. With this in mind, Census data on dwellings occupied by foreign/temporary residents represented 0.8 percent of the dwellings in the Vancouver CMA in 2011, about the same share as in every other metropolitan region in Canada. While the City of Vancouver sits slightly above the Vancouver CMA-wide average for units occupied by foreign/temporary residents (1.8 percent), there are other parts of the Metro Vancouver region where such occupancy is much more prevalent, most notably in the UBC/UEL area (5.8 percent). Unfortunately, discussions around these issues in Greater Vancouver have suffered from the incorrect reference to—and use of—the Census and other data on the occupied and unoccupied dwelling stock.
Given the dearth of data on the topic and/or a sound methodology to develop good proxy measures, any claims that the prevalence of either foreign/temporary resident occupancy or unoccupied units is having a significant impact on housing in this region is mere conjecture. Before policy decisions are made to address these 'problems' more research is necessary; we cannot set off to address a housing 'problem' that is merely, at this point, a hypothetical issue.
Click here for the detailed report that presents Urban Futures' position on this controversial topic.
3 Housing Affordability
In jurisdictions where demand exceeds supply, the price of homes has increased rapidly in recent years. On top of this, the favourable lending environment (including historically low interest rates) that have characterized the past five years have no doubt contributed to rapidly-rising prices in the Toronto, Vancouver, and Calgary housing markets.
Regionally, affordability concerns are continuously being revisited, be it through the Vancouver Sun’s UDI/FortisBC Housing Affordability Index, through the Vancouver Sun's housing affordability map, or via the BC Non Profit Housing Association's Rental Housing Index (the development of which we provided advice on; click here for details). More specifically, the Vancouver Sun’s affordability map shows that three-quarters of Metro Vancouver's neighbourhoods are unaffordable under the metrics used to develop the map; the reality, though, is that people are still moving to these neighbourhoods, housing is still transacting in these neighbourhoods, and prices are still moving up in these neighbourhoods.
The metrics historically used to assess housing affordability are average (or median) household income and average (or median) sales price. In considering the monthly payments required to capitalize a mortgage for the average (or median) sales price in each neighbourhood, this can be compared to monthly income in the same neighbourhood. Typically an area is unaffordable if a household has to spend more than 30% of its income on housing. Few people actually know where the 30% threshold has come from; it can be argued that this approach is, at best, antiquated and, at worst, misrepresentative of what the housing market's current situation is.
Take the example of a first-time home purchaser who, with her current income, may be able to purchase a condo for $360,000 (12,100 units were sold at or below this price in the region last year). With five percent down ($18,000), she would be on the hook for a $342,000 mortgage. However, we know that her mom and dad really want her out their house (47% of kids aged 20 to 29 are still at home in the region), so they offer to help her out with a $50,000 gift. As a result, our first-time purchaser would now have the option of either reducing the amount mortgaged (and their monthly payments), or she could buy a unit that costs about $410,000, not $360,000. While one can only speculate about what most people would do, what this scenario points to is a breakdown of the traditional metric of relating a household's (or a person's) income directly to a home's sales price, as there is a potentially large impact associated with wealth or any inter-generational transfer of wealth. Unfortunately, there are not a lot of data to measure wealth or wealth transfers; data on this issue may help to further explain the disconnect between Vancouver’s relatively low average and median incomes, the high price of homes, and the ever-increasing home ownership rates (the number of owned units divided by all units) throughout the region.
Given the multitude of factors that contribute to increasing home prices in the region, one of the few areas where municipal governments have some level of influence is on the supply side. Recognizing that we live in a highly desirable region that is geographically constrained, we should expect prices to be high. That said, one approach to mitigating price increases is to expand supply. Given the traditional interplay between supply, demand, and prices, this should, theoretically, slow price increases. In any event, the most unfortunate thing about the unending affordability discussion is that it masks the real housing-related issues that plague our region, specifically, those that relate to people that are truly in need: the homeless, the under-housed, and other at risk.
For more reports on this and other housing-related topics click here.
4 Transit & Transportation
For every level of government, issues revolving around the mobility of people and goods were front-and-centre in 2014. These ranged from the environmental and political challenges of transporting oil from Alberta to the Asia-Pacific and US markets, to BC Ferries and reforms to services and fare structures, and the long-anticipated transportation referendum on regional transit funding in the Lower Mainland. While these issues seem to vary widely, the core of all of these conversations has been the acknowledgement that creating efficient, safe, adequately-funded, and environmentally-appropriate ways to move both goods and people has become paramount.
At the municipal level, one of the trends we have observed over the year is the importance that new development has placed on accessibility. This includes the recently-approved redevelopment of Oakridge Centre and MC2, a mixed-use (residential/commercial) development located at Cambie Street and Marine Drive. These two developments, and many others throughout the region, are increasingly being treated as their own micro-centres. Both the established Canada Line and the yet-to-be-built Evergreen line, expected to be operational by 2016, suggest that transit-oriented development will continue to flourish in Metro Vancouver in the coming years. While transit accessibility is important to both residents and businesses in these new developments, general issues of accessibility (by auto, bike, foot, wheelchair, or scooter) will be a growing issue for all communities throughout the region as we are expected to add upwards of 1.3 million more residents to 2041. Andrew presented a map of accessibility in the Lower Mainland at the New Westminster Economic Forum in October, which outlined the most accessible sites throughout the region based on population-weighted time travel. Can you guess where the most accessible sites in the region are? You can check out the auto, transit, and general accessibility maps here .
At a broader level, an increasing amount of attention is also being paid to how both people and goods can be more efficiently moved throughout the province. Examples include Port Metro Vancouver's Port 2050 program, which considers a number of future scenarios for port-related activity in Metro Vancouver and its importance to both provincial and national economic activity. Andrew contributed to Port Metro Vancouver's visioning and planning processes on December 5th. Watch in the new-year from Port Metro Vancouver on their ongoing planning efforts.
Despite the indisputable fact that transportation systems are crucial for the economic, environmental, and social well-being of communities, it remains a constant challenge to measure and convey their importance in an empirically-sound manner. Click here read more about transportation-related issues on our website.