The lifestyle is 40% vacant

The Rise

Vancouver’s rental vacancy rate ranks up there with the career of Nicolas Cage as one of the great mysteries of the modern age. (Did you see Wicker Man? If you didn’t, don’t.) The Canada Mortgage and Housing people tell us the vacancy rate is 0.5 per cent. The CMHC are also the same folks who say it was “prudent” to introduce the 40-year mortgage.

Me, I have no idea what the real vacancy rate is but I’ll say it’s higher than 0.5 per cent. A walk in the West End or a search on Craigslist and you’ll discover a plethora of apartments for rent. Trust me, search “available now” and you have to be careful not to crash your browser.

The Rise is one of the few rentals in Vancouver advertised as if it were a condo. Unfortunately, the prices are owner-inspired rather than rental-inspired. To live “above it all” prepare yourself for at least $1,800 a month for a one-bedroom-and-den.  Be advised, by “above it all” I mean above the Cambie Street Home Depot. Granted, the green roof is cool. Still, what person would rent at that price when the same money can rent so much more?

As for the vacancy rate, The Rise is 60 per cent occupied. That’s a marketer’s way of saying it’s 40 per cent vacant. There’s also a free rent deal when you sign a one-year lease. Not exactly evidence we’re in a market of high demand.

But hey, what do I know? I’m just a renter.

37 Responses to “The lifestyle is 40% vacant”

  1. Strataman Says:

    I’ve mentioned this before on VCI, Vacancies as calculated by stats canada which I believe is CMHC’s source are done on the basis of 3 or more suites rented by the SAME landlord Has to use identical name as well) either owner or property manager. For instance all the suites Prompton has WOULD be counted as they would be a known PM firm. Lets say one Tower had 10 rental suites that were managed by ONE property manager and nine were rented, and in addition there were 90 suites for rent by individual owners who had no more then two suites in ONE name. So in this example the Tower has 100 suites, for fun we will say NONE of the individual suites are rented so the total rented is NINE! 🙂 The vacancy rate as calculated by stats canada would be 10 % vacancy (one out of ten). The real vacancy is 91% vacant. I work in dozens of towers and my guess is around a current 10 to 12 % vacancy rate in Yale town.

  2. NWwatcher Says:

    I like to check the vacancies at Transglobe, http://www.gotransglobe.com/, in the New West area. Six mos. ago they were around 8 but lately as high as 26. No movement in rents though, and no incentives offered. And, man, these units are your basic “cheapest of everything”. Just out of interest I checked Kitchener, ON to get a comparison and there the vacancies were over 50!

  3. Carioca Canuck Says:

    For comparison’s sake…..the stated vacancy rate for Calgary is 5.0% as quoted by the Apartment Association……CMHC has it at arund 2-3%…..reality is at around 10%……my building where I live is a 3 year old luxury high rise and rents for $1600+……they currently have a $200 bonus for tenant referrals and about 15 vacancies……I have also been told that my rent is not going up in June. Therefore, I will be asking for a $100 monthly reduction or I will move.

  4. r. Says:

    Hype- My experience looking for a rental this fall was that while there was quite a number of rental vacancies in absolute terms, the vast majority were poor value, inflated to keep up with the bubble in the purchase market. Many spots were overvalued 25-30%, esp. “investment condos” that the mortgage holders were trying to let in hopes of covering some of their costs. Anything that was close to what I felt was fair market value was highly sought after with plenty of competition. The expensive stuff stayed on Craigslist for the whole time I was looking, leading to all of the same “available immediately” stock that keeps popping up every month.

  5. LB Says:

    Yeah, clearly the vacancy rate calcs are wonky. My gut feeling for the vacancy rate for non-insane rental units: about 1%. When I was looking last year it was the usual mob scene of people showing up trying to chat up the property managers, leases being signed on the spot. Insanity. We only got our apartment because the guy who saw it before us went to have a coffee to think about it. ha!

    But yeah, if you’re looking to pay $2k for a 1bed+den, you’ll have plenty to choose from.

  6. bdk Says:

    The rental market is so soft right now downtown.
    I don’t now but I did work within a real estate company and have watched rentals pile up in coal harbour.
    I went and looked at units that were for rent in the newly completed ritz project in late October and found landlords willing to rent for $1400,$1450 & $1500.
    As of right now there are still pinheads trying to get $1750 for the same units and they are now competing with shangri la, which are also flooding the market.

    This can’t end well with another 2,500-4,000 new units coming to downtown vancouver in ’09 with the current glut going nowhere and an exodus of construction related workers and first time buyers vacating their current rentals.

    In particular the dumps in the west end that want $1100!
    It’s just silly when you can pay $150 more and get into a new unit with nice appliances, concierge, restricted floor acccess,insuite laundry, pool, secure parking etc. etc.

  7. genxr Says:

    they should’ve sold the units of this place when it was built..was aruond the peak time. was surprised it was for rent instead. costly mistake.

  8. blueskies Says:

    The Rise was built by Grosvenor, these guys have more money than god so won’t be any problem with carrying empty apts.
    The building was designed and built as rentals……

  9. Kevin F Says:

    It’s hard to find a good deal downtown. There are plenty to choose from for $1800. I lucked out and managed to get a studio for $900. One thing that concerns me is when we get close to the Olympics they kick me out.

    I imagine a lot of land lords are planning to do this. My buddy thinks he can rent out his condo in New West for $25,000. I didn’t have the heart to tell him he is insane.

    If a lot of people get kicked out right before where are they all going to go? I’m lucky that I can move back home but I imagine a lot of people can’t do this. Even if you signed a one year lease I’m sure they will find a way to kick you out a month before the event. Kind of sucks living in a city where it seems it’s every man for himself and everyone is trying to make a buck of you.

  10. condohype Says:

    bdk: “It’s just silly when you can pay $150 more and get into a new unit with nice appliances, concierge, restricted floor acccess,insuite laundry, pool, secure parking etc. etc.”

    This is why I left the West End and moved into a new rental condo. For a marginal increase in rent, my quality of living went up astronomically. I went from stained carpets, coin laundry and broken heating to a beautiful brand-new apartment with all the amenities you describe.

    It seems to me that there’s two rental markets in Vancouver. There’s the less expensive, which is the old-school purpose-built rental stock (think West End and Kits); and the more expensive, which is the investor-owned condo. If there’s any truth to the CMHC data, it applies to the least expensive units. Anyone trying to find an apartment for the cheapest possible price knows how difficult it is.

    But for Vancouver’s less affordable apartments, it’s a different story. Anyone willing to spend $1300+ for a one-bedroom has incredible choice in Vancouver. In fact, it’s possible that this market has a vacancy rate near the double digits.

  11. Andrea Says:

    “One thing that concerns me is when we get close to the Olympics they kick me out.”

    I’m looking for a place for February 2009 and have the same concerns. Is there any kind of protection we can have written into the lease saying they can’t evict us or charge more during the Olympics? Or are they just going to break the lease anyway?

  12. mk-kids Says:

    Well, I am a recent move-in to The Rise and so glad to see this post condohype… you are, as always, on the money! We are paying through the nose to live here for sure but truth be told, I love the green roof, the quiet, the view, and the location! We front the green roof which is cool, the apartments that look outside would suck for noise and the neon of Canadian Tire’s sign shining directly into your windows 24-7. The finishings are pretty cheap, just like new construction but the layout is good. The landlord sucks, Grosvenor are greedy bastards but we looked a long time and this was the choice we made and we are happy with it. Plus our lease is only a year so if its too expensive or a better deal is to be found next fall, we can always move! At least we didn’t need to pull out our savings for the privledge of paying too much for shelter expenses monthly…

    There are a whole lot of empty suites here, I’d say more than 40% and I expect that they will have to drop the rents $300 per month to actually start filling them.

    BTW – the big scam here is that they charge you GST on your rent & parking because of the “zoning” – it’s total BS. I talked to the city and they said it is BS and still I live here and like it! Ugh! Well, I’ll take this hood over Coal Harbour or Yaletown anyday and as long as we can afford it, its all good. But the hype is still hype so bargain hard if you want to move here!

  13. condohype Says:

    Thanks for the comment, mk-kids. I’m impressed with The Rise. They did a great job with the design and the green roof is really spectacular. When I went up there, I couldn’t believe how nice it was. I just wish the prices for the suites reflected the real market. If Grosvenor dropped the rent by $200 they’d probably have a lot more tenants. It’s no good to have units sit empty. It’s not only wasteful but I can’t see the owner recouping the lost rent over the long-term. Why not just price fairly from the start?

  14. mk-kids Says:

    Agreed CH. We took some time with our decision precisely because of the price but in the end decided to suck it up. Grosvenor fired the old marketing company in November, a new one has come on board and I expect that when the “1 month free!” promotion fails to fill suites, they will convince the greedy bastard landlords to drop the rents.

  15. doug r Says:

    From what I remember of Expo 86, a lot of slumlord/SRO hotels kicked out poor tenants to renovate for Expo visitors. They ended up taking a bath as people seemed to have other arrangements.
    Any landlord that clears out their regular tenants for the Olympics is going to be looking at an empty building in March with the housing market tanking and desperate owners putting up units to help pay resetting mortgages.
    I’m sure some will try, but if you can afford another place for a couple of months, the market should drop again right afterward.

  16. patriotz Says:

    Is there any kind of protection we can have written into the lease saying they can’t evict us or charge more during the Olympics?

    The lease itself is your protection. It’s a binding contract. If you pay the agreed rent and don’t do anything illegal they can’t kick you out. And they can’t raise the rent. Period.

  17. islander Says:

    Good advice, patriotz, but I’d also add that landlords are not allowed to do anything that amounts to a raise of your rent, such as starting to charge your for utilities, condo fees, parking space, etc., where before it was built into your rent.

  18. jesse Says:

    “And they can’t raise the rent. Period.”

    Actually there is an arbitration process to raise a rent above cap in case it is demonstrably below market. The problem is, apparently, it is difficult to prove, but is there as a relief just in case.

  19. jesse Says:

    Of course the arbitration is useless with leases, but applies when the lease terminates and the contract defaults to month-to-month.

  20. Brian Says:

    Okay, so basically people are charging too much money. Can’t say I’m surprised. Last year the Tyee ran an article about how Vancouver eats its young and it is still true today. As I renter I know that my tenure in Vancouver is just about over even if the rents start coming down again. I can no longer count all of the people I know leaving the city. The list grows every week. Bad landlords, bad jobs, and moldy suites. Enough.

  21. Kevin F Says:

    “The lease itself is your protection. It’s a binding contract” This is true but I have witnessed first hand my friends getting kicked out of their downtown apartment because either the owner was selling the unit or claim to be renovating it. My friends got a 14 day notice when living in their last place because the owner was going to sell it. They are taking it to small claims court but will take 6 months to a year to process plus the owner lives in China which makes it harder to pursue. They figure the most they could get is one months worth of rent.

  22. LB Says:

    Something else to keep in mind for people renting from investment-owned condos rather than in dedicated rental buildings…. owners can evict tenants for “personal use of the unit”. I figure there will be a lot of owners thinking they can cash in on the Olympics who will evict their current tenants. I’m sufficiently paranoid about that that I made sure to move into a dedicated rental building.

  23. Digs North Van Says:

    There are deals to be had in the burbs also. Just did the ‘find a rental’ dance in North Van and found 36 houses that fit my requirements (3-4br, takes cats, east of Lonsdale etc.). Ended up having our favorite 2 bidding on us and dropping advertised rents by more than 25%.

    More than half of the people stating they have taken the house off the market to ‘wait it out’ but some were surprised how hard it was to rent also.

    If anyone is renting soon in NV post and I will arrange to send you a very detailed assessment of what’s out there as of last week.

  24. Digs North Van Says:

    Those commentating on eviction for ‘landlord use’, the Rental Tenancy Act spells out very clearly that if you have a lease, even landlords use won’t get you out. If you are month to month and the Landlord has not followed the details of the act, you might be okay too.

    The post who’s friends who got a 14 day notice were foolish to move. The landlord had no right, and they must provide 2 months notice and 1 months free rent.

    Spending 30 minutes reading the guide for the act at http://www.rto.bc.ca could have saved them a whole lot of grief and some $. Also you can email hsrto@gov.bc.ca with any questions and they get back to you a day.

    Don’t take your advice from the blogs on this particular subject – SOOO much incorrect information, most of it from Landlords who think they can get away with way more than they really can. The RTA is heavily in favor of the tenant, and the burden in almost all situations is put on the Landlord.

    In this case, information is a powerful thing.

  25. Jo Says:

    I second the above. One of the joys of renting in vancouver is that renters are on the whole very well protected. As for people expecting to get $25,000 for renting their place out for the Olympics. A lot of people holding on to their units with that expectation, or even an expectation of getting anywhere close to that amount, are going to get a shock.

    For a start, anyone who can afford that kind of money and is that desperate to see the Olympics will have fixed up accommodation long ago. Also, this doesn’t happen at other events that attract more people. For example, I lived in Edinburgh, Scotland for a while and they have a massive 4-week arts festival there every year when the city of 450,000 people almost doubles in numbers. Not only do festival workers need 4-week accommodation but so do performers at the Fringe. Plus there are all the visitors who may need somewhere for anything from a few days to the whole month. And there is a shortage of hotel rooms. Many young locals I knew moved in with their parents and rented out their own places and the going rate for good 1-bed flats was usually around $2200 to $2600 for 4 or 5 weeks – certainly less than $100 a night . And this is in a very nice city in the middle of summer, not a rainy city in winter. So I’ve no idea where people got the idea they are going to make $25,000 from a 2-week event. I can’t find any evidence this happens anywhere, apart from the very rich who rent places for those sums all the time.

  26. GV Says:

    Speaking of rentals….thoughts appreciated….

    I’m thinking about renting a fully furnished studio apartment on the 20th floor of an apartment building near the burrard st bridge (downtown side). The suite has a full view of the ocean, west end etc. About 500 square feet.

    It’s one of those concrete buildings with coin laundry. The suite itself seems to be well taken care of.

    The rent is 1k, all inclusive.

    As I’m relatively new to the rental game, I’d appreciate advice on this price.

  27. rob bennie Says:

    Hey complaining renters…… maybe it’s time to buy eh?

  28. Patiently Waiting Says:

    Jo, very interesting.

    I also saw a local news story recently about how luxury hotels are going to rein in accommodations costs during the Big O. The Winter Olympics will be expensive for tourists (airfare, tickets etc.) and they were concerned that might scare some away, especially during a recession.

    All these “$1000/night for my Surrey closet” greed-heads will be competing against these industry veterans. They don’t stand a chance :^)

  29. Patiently Waiting Says:

    “Hey complaining renters…… maybe it’s time to buy eh?”

    You first.

  30. Publicus Canada » Blog Archive » » Year End Report on Gentrification Says:

    […] for a good reason, but not everyone has bought-in as villagers fight for comepensation while The Rise sits half […]

  31. anonymous Says:

    Want to be amused? Do a search for Menkis Court on craigslist. A buddy of mine tells me it’s like 80% unrented and asking the same rental prices as the Rise. No wonder.

  32. Patiently Waiting Says:

    Developers considering building rental apartments

    http://tinyurl.com/8cygp2

    “According to the Globe and Mail, the Urban Development Institute is holding a workshop in January to help builders understand the market.

    For the past 35 years, rental apartments have fallen by the wayside and many buildings in Vancouver were bulldozed to make way for condos, resulting in a severe shortage.

    One developer is in talks with both Vancouver and Richmond, hoping to get a temporary break on property taxes in exchange for a promise to keep the buildings as rentals for ten years or more.”

    I’m not sure how they will make this work. My guess is either low-end highly-subsidized rentals or high-end with extra special luxuries to try to justify high rents.

    Either way, this is another kick in the crotch for the specuvestor accidental landlords.

  33. Patiently Waiting Says:

    Original Globe and Mail story:

    http://tinyurl.com/8vyk4w

  34. Jo Says:

    Patiently Waiting – “greed heads” is right. The folk in Edinburgh I mentioned who rent their places out – every year in some cases – aren’t greedy about it. They hope to get about one or two month’s mortgage payments out of it a year. The result is that people who need accommodation for the event get it at a reasonable price, people who want to make a little extra cash (despite the inconvenience) get to do that. And everyone enjoys the events.

    If people are going to charge exorbitant prices for accommodation in Vancouver for the Olympics, that’s going to give people a very bad impression of the city – as basically it will look like the residents are out to fleece the visitors. And that’s not the right approach. They should be welcoming people and charging a price they themselves would pay rather than trying to empty people’s wallets.

  35. Patiently Waiting Says:

    Yeah, I hate it. It embarrasses me as a Vancouverite. I can’t wait for post-O news stories and hearing these pigs squeal about the windfall that didn’t happen.

    http://vancouver.en.craigslist.ca/vac/970370899.html
    $3200 may be fair monthly rent for a nice North Van house. But per night? WTF!!!

    http://vancouver.en.craigslist.ca/vac/967334037.html
    This guy doesn’t get it. Athletes are poor. They simply don’t have $25,000 to stay near the oval. He richly deserves his fate for trying to profiteer off the athletes like that. Let that fate be foreclosure and bankruptcy. PLEASSSSSE!!!

    I can’t wait to see these piggies smoked like bacon.

  36. Rob Bennie Says:

    Hey, you copied this story from a poster on Jurock!!!

  37. Joe Says:

    I found renting to be quite difficult when I moved to Vancouver in August. There were any number of places available but they were way over priced for some pretty awful living conditions with landlords that didn’t speak english. I ended up moving to The Rise because, while it is just as over priced as the other places, at least I’m not living in a slum with a landlord that doesn’t care about privacy rights.

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