June « 2018 « Les Twarog Vancouver Real Estate and Condo Blog

Archive for June, 2018

Here’s how Empty Homes Tax revenue will be spent

Thursday, June 21st, 2018

Vancouver city council approves allocation of $8 million towards affordable housing initiatives

Naoibh O?Connor
Vancouver Courier

Vancouver city council has approved staff recommendations on how to spend $8 million worth of empty home tax revenue it’s collected to date.

The City of Vancouver expects it will collect $30 million from the tax in the first year, but implementation and operating costs will eat up $10 million, leaving $20 million to be invested on affordable housing initiatives.

About $18 million of the anticipated $30 million has been collected so far, which, after implementation and operating costs are covered, produces $8 million for distribution.

The money will be split as follows:

$3.175 million: more affordable co-op and non-profit housing. It will be invested in providing land and resources for affordable non-profit and co-op housing.
$1 million: more affordable co-op and non-profit housing. It will be invested in co-op housing grants to update and improve existing co-ops and build new co-ops.
$3.5 million: Improvements to low-income housing. The money will be used to contribute to the purchase of buildings and/or to provide assistance toward improved living conditions in private SRO housing.
$100,000: Support for vulnerable renters. The money will be used to provide support to renters facing eviction.
$75,000: Support for vulnerable renters. The money will go towards the Vancouver Rent Bank.
$100,000: Funding for skills training in peer support, affordable housing management, and asset training for residents of supportive housing. The basis for the idea was dreamed up at a recent one-day workshop. Proponents called the initiative ‘temporary modular college’: temporary modular housing with on-site peer-based mentorship programming.
$50,000: Matching empty/underutilized homes and rooms with renters looking for housing. The money will support shared housing models like senior/student housing arrangements.

Staff recommendations were informed by public feedback collected during a consultation process that included an online survey and a one-day “idea jam.”

“I’m very pleased that council has approved a variety of new affordable housing investments funded by Vancouver’s first Empty Homes Tax,” Mayor Gregor Robertson stated in a June 21 press release. “Thank you to everyone who took the time to submit, like, and comment on your favourite housing ideas. We will now be moving forward with new initiatives that will boost support for low-income renters, create more co-op and non-profit housing, and look at new opportunities to make the best use of our existing rental housing.”

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Taking shortcuts with insurance not a smart move

Thursday, June 21st, 2018

Often problems with ideas about insurance

Tony Gioventu
The Province

Dear Tony:

Our strata council has been advised by our property manager to pay for a water escape claim to our building rather than file an insurance claim to avoid an increase in our insurance costs and our deductible costs.

This is only the third claim in 10 years in our 18-floor highrise. As a result, we have only a $5,000 deductible.

The claim to repair damaged drywall, flooring and cabinets to the two units is estimated at $11,000, which we have been told we can recover from the owner who caused the claim from an overflowing bathtub. The owner who caused the claim has responded that they will not pay any amount as their insurance coverage for their unit will cover the deductible amount of $5,000.

Our council is confused by the opposing information we have been receiving. Whose insurance covers the claim and can we recover the costs so the rest of the owners in the building are not paying for one owner’s neglect?

Tara D., Burnaby

Dear Tara:

A common error condo owners make is applying the cause of the claim to whose insurance is responsible to cover the loss.

Under the Strata Property Act, with the exception of a bare-land strata, the common property, common assets, structure and fixtures are insured through the strata corporation policy.

Basically, think of it this way: before the day an owner moves in, everything except removable appliances is covered. When these items are damaged, whether they are in a strata lot or defined as common property, it is the strata corporation insurance policy that is applied.

Provided the amount of the claim is over the deductible as in your case, the insurer for the strata corporation remedies the loss and bills the strata corporation for the deductible. In this case: $5,000.

The cause of this claim, an overflowing bathtub, falls under the responsibility of an owner. If an owner is responsible for a claim, the strata corporation may proceed with an action through the courts or the civil resolution tribunal to obtain a judgement to determine who is responsible for the claim and the amount of the deductible.

When owners have prudently purchased condo insurance that covers the amount of a deductible, once they have received a statement or demand invoice from the strata corporation for the amount of the deductible, they contact their insurance provider who pays the amount. In most cases, the insurers work in co-operation well in advance to reduce red tape and delays.

Strata councils seem to be under the impression they can deny a claim and manage the restoration themselves. There are several problems with this approach. First, an owner under the Strata Property Act is a named insured on the policy and they can file the claim directly. Second, the restoration and remediation when water damage is involved is rarely undertaken sufficiently to prevent mould, dry rot, pest infestation and future damage to the units. The final problem with avoiding the filing of a claim is that the strata corporation will be limited to the extent of the amount it can collect from the owner.

If the owner was responsible for the claim and the deductible was $5,000, how would you expect to collect the additional $6,000 in damages that was covered by the insurance you have now declined? And neither amount is a deductible so the authority to proceed with an action to collect the amount may no longer apply.

There is one other wrinkle in this approach. Where did the strata corporation get the authority to spend $11,000 of the owners’ common funds? This is not an emergency expense, authorized contingency expense or operating expense. It is an insurable claim covered by a common policy all the owners pay through their strata fees. Yes, there is a risk your deductible will increase and perhaps even your policy, but that is one of the costs of living collectively in a strata corporation.

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8888 Osler 76 homes at 8888 Osler Street Vancouver by Tria Homes

Thursday, June 21st, 2018

8888 Osler showcases efficient design

Mary Frances Hill
The Province

8888 Osler

What: 76 homes

Where: 8888 Osler Street, Vancouver

Residence sizes and prices: Studios and one- to three-bedrooms, 431 to 1,101 square feet, starting in the $500,000s Developer and builder: Tria Homes

Sales centre: 1510 West 71st Avenue, Vancouver

Sales centre hours: noon to 5 p.m., Sat — Thurs

Telephone: 604-715-6060

Marpole is having a moment, with the city and developers recognizing its potential as a revitalized and vibrant mixed-use Vancouver neighbourhood community, close to Richmond and the airport.

For interior designers, it’s exciting to be part of Marpole’s revitalization, says Cristina Oberti, whose firm designed the interiors of 8888 Osler, Tria Homes’ community of condominiums planned for the area.

“I see it as an opportunity. It’s a chance for us to be creative and imagine what the future of Marpole might look like a few years from now. Rarely do you get this kind of freedom as a designer,” says Oberti, principal of Cristina Oberti Interior Design Inc.

“I expect to see a lot of young families and single first-time buyers migrating to Marpole. It’s definitely a great area to invest in.” Where another professional might consider suites as small as 431 square feet as a restriction in their work, Oberti sees it as a challenge.

“To design for efficiency is to design smart. This is often when design becomes the most interesting and inspired,” she says. “There is literally no room for wasted space.”

Oberti says she and her team enjoyed creating an open-concept area with a multi-functional use of space. Visitors will find that the design of the kitchen takes advantage of every last square inch available.

Oberti says kitchens in smaller homes look great when a homeowner sees them as deserving of attention as fine pieces of furniture.

It’s too easy to crowd countertops with appliances and devices. But in an open-concept space, it’s on full view, so Oberti incorporated deep drawers and spinning Lazy Susan shelving to maximize storage space.

At 8888 Osler, “the kitchen is designed to be exceptionally efficient. It’s an area that is always on display, so it needs to look good, if not in order. Besides hiding things from view, the extra storage also gives the kitchen an interesting esthetic.”

First-time homebuyers of smaller suites may want to ask themselves hard questions about what is essential in a comfortable home, but Oberti suggests that choosing fewer items should not be seen as a hardship or sacrifice, particularly when these pieces serve one or more functions.

“As cities grow, our spaces become more and more precious, so we have to make the most out of what we have available to us,” she notes.

“In these cases, it’s important to prioritize. Is it essential to have that massive sectional, when a more compact love seat will do the trick? I don’t see it as a limitation, but rather as another way of approaching the spaces we inhabit.”

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Vancouver approves plan to curb speculation along the Broadway corridor

Thursday, June 21st, 2018

Broadway corridor protected from land speculation

Cheryl Chan
The Vancouver Sun

Vancouver council approved new policies designed to curb land speculation and limit condo developments along the Broadway corridor.

On Wednesday, council adopted a new measure called the development contribution expectation (DCE) intended to limit land values in anticipation of the arrival of the Millennium Line extension to Arbutus Street.

It also adopted an interim rezoning policy that’ll be in place during the two-year planning period for a comprehensive Broadway plan.

“There’s lots of pressures here,” said Mayor Gregor Robertson. “We don’t want to repeat the mistakes past councils made in not doing the planning work in advance of the Canada Line and some other lines.”

The Broadway plan covers the area from Clark Drive to Vine Street and from 1st Avenue to 16th Avenue., a regional economic powerhouse that’s home to close to 70,000 jobs.

Staff told council the goal of the interim rezoning plan was to send a strict message that affordable social or supportive housing will be prioritized.

Proposals for condo projects aren’t going to be considered except under “exceptional circumstances” and only in certain zoning districts, mostly on main thoroughfares.

According to a staff report, the DCE rates — set at $330 or $425 per square feet depending on location — sets the expected benefit or contribution of the project to fund amenities to serve future growth.

The charge will be levied on additional density beyond what is currently allowed.

It will not be collected at the time of land sale or acquisition, but indicates the amount expected for future redevelopments, said the city.

Nineteen projects, mostly rental buildings and offices, that have already submitted a rezoning application or received a written green light from the city will be allowed to proceed.

While staff believes there hasn’t been widespread speculation along the Broadway corridor, there are cases it believes buyers are overpaying for land.

“There is evidence we are already seeing this upper pressure of land values because of the potential for additional density through the planning process,” Blair Erb of Coriolis Consulting, which worked with the city to determine the DCE, told council.

Andrew Grant, president of PCI Developments, told council the DCE will impact housing affordability as the fees will be passed on to buyers.

He estimates the DCE of $425 per square foot would add almost $280,000 to the cost of a 600-square-foot condo built west of Main Street.

“It’s not going to be a real deterrent to speculation, and I think it is going to add to home ownership costs,” said Grant.

In a letter to council on Wednesday, Urban Development Institute president Anne McMullin questioned the limitations placed on strata developments as they are likely the key source of funding for public benefits and amenities in the neighbourhood.

“If little or no strata development is allowed, it will be unclear how public benefits are funded,” she said.

McMullin said the DCE charges are “substantial” and will only add to government costs on housing.

Coun. Adriene Carr said the DCE could be an effective tool to stop the escalation of land prices, and doesn’t believe the cost would necessarily be passed on to homebuyers.

The Broadway planning process starts January 2019 and is expected to be completed in December 2020.

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