The Ironies of Vancouver: The Post-Gentrified City

Vancouver       Vancouver in British Columbia, Canada may be a case study of the post-gentrified city.  Average housing prices have dropped all the way down to $1.4 million per house.  The Vancouver Sun reported that a Habitat for Humanity house had sold for $330,000.  ACORN Canada’s office and all of our groups are in the working-class suburbs of Burnaby, New Westminster, Surrey, and other communities.  It is difficult for low and moderate-income families to afford to even think about living in Vancouver.

The government is progressive.  Leadership has been stable with an excellent and forward-thinking mayor in Gregor Robertson for a number of years.  There is no lack of people trying to do the right thing.  There is no confusion at the top or at the bottom of the economic and political ladders that housing is unaffordable.

So, what does Vancouver do to assure that housing is affordable and to prevent the city from just become the living and working space for the rich and elite?

While in the city for the ACORN Canada board meeting and annual general meeting, the next four years city budget for capital or big construction and development projects was published.  The capital budget is big time for the coming four years, $2.6 billion.  Surprisingly though, 55% of that budget or $1.44 billion the Sun reported are “earmarked income from ‘development contributions,’ which are raised by charging real estate developers.”  At first glance, we might say that’s great, “Make them pay!”  At second glance it is hard not to think that the city of Vancouver may be riding the sharks as much as regulating them.  If developer money is funding so much of capital expenditures, then the city also depends on new development, which gives developers a lot of leverage

In fact, when it comes to affordable housing and child-care spaces, which many might argue are the top priorities for lower income and working families in the city, the capital budget is scary.  First, it only provides for 1200 to 1600 nonmarket rental house and 1000 child-care spaces, which annually is only 300 to 400 units per year and 250 child care spaces. That’s way too little.  The fiscal number for the construction was $539 million and the budget says that 99% or $535 would come from development contributions, meaning the city and its taxpayers have zero skin in those projects.  For the $117 million for child-care development contributions are 94%.

The Sun helpfully defines these development contributions.

“Development cost levies…are typically a standard calculation.  Community amenity contributions tend to be individually negotiated between the city and a developer over rezoning for a specific project and can be paid in straight cash or the building of an on-site amenity such as a pool or community center.”

One is a tax and the other is what we would normally see emerge from community benefit agreements, although it almost seems like the developer is driving the decision to benefit their own project, rather than the community or the city.  An amenity would seem to accelerate the rewards for gentrification as well.

It would seem like a rich, gentrified, progressive city like Vancouver could – and should – be doing so much more.


Hedge Fund Housing Horror Stories in California

San Jose       At the University of California at Santa Cruz in the question and answer period after THE ORGANIZER, I got what has become a standard question about the role of social media in organizing.  I’m always kind but clear.  Social media is a fantastic and inexpensive communication tool that is invaluable for organizing, but it is not a substitute for the face-to-face work in the streets and workplaces where people can participate in the dialectic of direct back-and-forth conversation, listen and learn.

Talking to a young man involved in the social documentation program at the university who had been filming lots of tenant organizing work in Sacramento with his help I was finally able to understand why hedge funds, like Blackstone, have built a business model out of various rental schemes for the tranches of houses they acquired by sucking up foreclosed properties from banks, FNMA and others.   Rather than sprucing up and trying to resell these properties as the market has improved, they have either rented them or in many cases used various installment land purchase contracts to keep collecting, evicting, and holding onto the properties.  This is big business in Sacramento.  It turns out that single family homes in California are exempted from rent control restrictions there, allowing hedge funds sums to jack the rent at will taking advantage of the absurdly inflated rents and shortage of affordable properties.  ACCE, the former California ACORN, is helping lead the effort to put a ballot proposition forward in Sacramento to close that loophole, but it’s tough sledding on the signature drive and unclear if they will succeed in getting the measure before the voters this round.

A statewide initiative to repeal the law that blocks cities around the state from imposing rent control seems in better shape to make the ballot, and support may be both wide and deep there.  Talking to my cousins living and going to school in San Jose and Los Angeles they couldn’t believe the price of rentals in Texas, Louisiana, and Florida compared to these areas.  One talked about paying $1000 to share a room in LA for example.  Repealing Hawkins will definitely pull young voters to the polls!

Talking with the leaders of the Everett Program, ACORN’s great partner at UC Santa Cruz, we found ourselves all shaking our head in agreement when we talked about the end of the so-called American Dream of home ownership.  It seems to have already happened in California.  When I speculated that it would be commonplace around the country in ten years, there was no argument.   One of my cousins astutely observed in an early morning conversation that the only way most Californians would ever own homes is if they “were gifted.”  A similar point was made by a Santa Anna, Orange County Everett staffer.

How wide will we allow the housing divide become between the rich and the rest of us?