Soaring property assessments destroying Vancouver

Real estate values are evidence of a system that is unregulated to the point of being socially destructive

I  must say, in spite of voluminous commentary to the contrary elsewhere, I find no great pleasure in seeing the assessed value of my property escalating beyond belief this past year.

The unintended social consequences of what is taking place in Vancouver sees people being priced out of a market in a town where they grew up and where their parents and their grandparents could afford housing on a modest salary.

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No joy there. It is just evidence of a system that is unregulated to the point of being socially destructive.

I am not alone, of course. The little knot of neighbours that gathered on my corner a few days ago were hardly boasting of being Vancouver’s newest multi-millionaires. Our neighbourhood, Kitsilano, was once working class. The most recent house to sell on our block, a house on a 33-foot lot my neighbours note, sold for more than $3 million. Beyond the “holy cows” and the “you’ve got to be kidding,” there was real concern expressed about what this is doing to the sociology of our neighbourhood, and for that matter, to the whole city. “Affordability” is just another 13-letter word with no particular meaning when it comes to Vancouver.

I suppose that sale price made the developer happy. He bought what is referred to as a “tear-down” just over a year ago for $1.2 million. According to the real estate agent who just sold that house, he spent about $700,000 building the new house. So he walked away with just over a million bucks for his trouble and less than a year’s work.

I won’t even speculate as to how the young single woman who bought that house came up with either the cash or the line of credit to make the purchase. The real estate agent told me: “I never ask.”

My assessment, in case you were curious, went up 25 per cent. I will undoubtedly get a tax increase because it went up well beyond the city average of about 15 percent.

To add a little more perspective, my house and land are now assessed at 40 times (that’s four zero) than what I originally paid for it. My intention way back then was not to buy something that would be an investment. It was not some visionary act of genius. I just didn’t want to move.

I actually was a tenant in the house and the owner felt forced to sell when I had him charged under the city’s minimum standards of maintenance bylaw. The joint was falling apart. After I talked several prospective buyers out of making an offer, the owner dropped the asking price and I bought it.

Just to further make a point. My income has not increased by anywhere near 40 times since. The little political gesture, the homeowners grant, created by WAC Bennett back in the day to ease the burden of property tax, is virtually unavailable for any owner of a single-family home in this town. The additional break given to seniors, presumably to compensate them for the fact they have had a decline in income, is also just a distant memory.

I suppose you could say that all of this provides an incentive for people who find themselves land rich but cash poor, to sell and, um, “downsize.” The trick would be to stay in the city.

And as the followers of Vancouver Vanishes author Caroline Adderson or Globe and Mail reporter Kerry Gold will know, the people who buy those houses are not simply a younger version of those who are selling and moving on.

Nor is it likely the houses being sold will be left standing. Gold had a story, perhaps an extreme example, this past week of a 14-year-old 8,700-square-foot mansion on Southwest Marine Drive that sold in 2011 for $6.35 million. It was flipped two years later for $8.88 million and has since been flattened to make way for a 14,000-square-foot pile.

All levels of government are wringing their hands over what this kind of phenomenon means to the very nature of our city. None, however, has managed to do anything about it except to shrug and point fingers.

So, am I happy about assessment values going through the roof?  Why would I be?

agarr@vancourier.com

@allengarr

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