Goodman Reports Archives

Seriously! Not an April Fool’s joke
Coming soon: 11,784 new rental suites

Goodman Report
April 1, 2017

For the last 10 years, we at the Goodman Report have railed against the rental housing policies of Metro Vancouver – and in particular the City of Vancouver – relating to the glaringly insufficient new rental stock under construction. The track record of local politicians in creating an environment conducive to purpose-built rental construction had been dismal at best, a travesty at worst.

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Train But No Gain? High-Density Transit-oriented Site Wasted

This article was written and published in the 2016 Year-End Goodman Report.

For the record, the Goodman Report is very supportive of responsible efforts by various levels of government to provide assisted or social housing for those in need. It’s clear to us, however, that the program put forward recently by the City of Vancouver for providing temporary modular housing is a reactive, poorly conceived solution to a deeply rooted problem.

Here’s what’s happening. To address the chronic non-market rental shortfall, Vancouver is currently installing on valuable City-owned land 40 temporary modular housing units of 250 SF each. While our politicians congratulate themselves on finding an approach to housing shortages and unaffordability, the manner in which they’re executing this program represents a misguided, wasteful use of high-density land and taxpayer money.

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The Tail Doesn’t Wag the Dog

This article was written and published in the 2016 Year-End Goodman Report.

Since 1983, the Goodman Report has clung to the position that socioeconomic and political events transpiring at least outside the borders of Metro Vancouver and B.C., if not of Canada, have played a major role in establishing and maintaining the status of our region. While the Vancouver brand is recognized, if not envied worldwide, our financial and political clout, by comparison, is considerably less so.

The recent American election only reinforces this view. Under a Trump-led administration, our next-door neighbour is about to undergo a political and economic metamorphosis that is likely to produce a spillover effect of considerable magnitude on Canada and Vancouver. Should the incoming administration live up to its “America first” protectionist rhetoric, it stands to reason that nations with longstanding treaties in place, including ours, will be required to make economic concessions to the U.S. In other words, we could very well experience potential disruptions to trade and commerce, quite possibly triggering higher deficits and interest-rate increases here at home. In addition, our competiveness could be sorely tested as the U.S. begins deregulation and major reform of both personal and corporate taxes. We’re in for a bumpy ride: bet on it.

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The Rental Housing Crisis: So what else is new?

This article was written and published in the 2016 Year-End Goodman Report.

Have the proverbial lights finally flickered on at the corner of Vancouver’s West 12th Avenue and Cambie Street? And have our elected officials and their advisors (read: spin doctors) acknowledged at last that we are in the midst of a rental housing crisis?

Under unrelenting pressure from a vast body of our citizenry – including students, new families, seniors and employers – the news media, BC Housing, the Urban Development Institute, landowners and the odd, very irritating commercial realtor, Vancouver’s municipal leaders after years of ruling in a vacuum of denial have now changed their tune. Even Mayor Robertson, after eight years at the helm, has admitted as much. As quoted in an article in The Guardian by Ashifa Kassam, Robertson said he “wouldn’t have dreamed the [housing] crisis would get this intense” (November 21, 2016). The Mayor artfully deflected blame away from his office by claiming that the crisis was owing to the impact of global capital and the fact that the provincial and federal governments were not doing enough.

We disagree.

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The Story Behind the Stats: 2016 vs. 2015 Comparison

This article was written and published in the 2016 Year-End Goodman Report.

Since its implementation on August 2, 2016, B.C.’s 15% foreign buyer tax has had a notable cooling effect on the residential housing market and, some might argue, on the multifamily rental investment sector as well. While very few of the 124 buildings sold in the first half of 2016 actually went to offshore buyers, the newly introduced tax has nevertheless served to dampen the normally high enthusiasm for this asset class. In the second half of 2016, only 50 buildings were sold: clear evidence of slowing activity.

Still, 2016 was very active, indeed one of the liveliest in 25 years. Building sales and total dollar volume came in close to the banner year of 2015. For 2016, however, the key value indicator of average price per suite rose dramatically in most communities tracked.

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New rentals are coming! New rentals are coming!

This article was written and published in the 2016 Year-End Goodman Report.

The shortfall in rentals hasn’t been merely a Vancouver problem. Municipal governments outside the city’s borders haven’t been coping well with their aging rental stock either. Though a bonanza for rental owners in terms of soaring valuations and sharply escalating rents, the dire shortage in the region has been disruptive, indeed disheartening, to segments of society needing affordability. These include students, young families and seniors, as well as employers looking to attract and retain talent. New supplies of market rentals would help ease these severe pressures.

And now?

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Our recipe: Valuing an apartment building

This article was written and published in the 2016 Year-End Goodman Report.

What goes into the mix when we decide what a building is worth? Here’s our stew:

Location: It’s not just about municipality. Neighbourhood, street, corner or midblock position – they all matter too. We get into the nitty-gritty, converting the property’s location into a quantified value.

Improvements/Condition: Any deferred maintenance? If the large items have been completed (think roof, piping, elevator, any structural requirements), then investors will view the property with greater pricing consideration. Is it a legal non-conforming structure, or does it conform? Any unauthorized suites?

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2015 – Greater Vancouver Rental Apartment Review

In the 2015 – Greater Vancouver Rental Apartment Review, we provide an in-depth analysis of the apartment building market. We looked at this past year’s performance vs. 2014’s and summed up all 2015 building transactions.

We comment on municipal government roadblocks and the stifling bureaucracy which continues to plague the development of much needed rental stock within Greater Vancouver. Furthermore, we reviewed CMHC’s rental market report, highlighted rental investment market trends and the impact of declining oil prices. Finally, we shared some ideas on how to optimize your asset’s value.

Download the exclusive report here >>

2015 – Mid-Year Greater Vancouver Apartment Building Market Review

With the first six months of 2015 now behind us, it’s time to compare how this year’s performance compares to 2014 for the same time period in Greater Vancouver.

Our latest report, 2015 Mid-Year Apartment Building Review provides an overall market synopsis including transactions, forecasts, market trends and the prevailing interest rate environment.

Download the exclusive report here >>