Co-op rental rate gap, largest market unit in Vancouver

garretschoenbergNovember 17, 2022

Average market rents continue to rise in Metro Vancouver as interest rates rise and vacancy rates are very tight.

Tom Armstrong, CEO of BC Common Housing Federation Photo by Jason Payne /PNG

Rising market rents in Vancouver mean the gap between market and co-op rents is the largest among major Canadian cities, according to new research.

The authors of this study set out to explore the value of public investment in maintaining or building new housing cooperatives in cities where homeownership and rental market costs are skyrocketing.

Since 2019, the average monthly rent for a co-op one-bedroom has been $560 lower than market rental buildings. Prior to that, until 2016, the average monthly rent for co-op buildings was just $260 lower than for market rentals. For a two-bedroom, the gap between co-op and market units widened from $450 to over $900.

A report released Tuesday by the Cooperative Housing Federation of Canada looked at rent differences between cooperatives and markets in Vancouver, Victoria, Ottawa, Toronto and Edmonton. There were input from community groups advocating protecting existing cooperatives and building new ones as a way to provide affordable housing.

Market rents in Vancouver are the highest of the five cities, typically 5% higher than Toronto for one-bedroom apartments and 20% higher than Toronto for two-bedroom apartments.

This is because interest rates are rising and vacancy rates are so tight that average market rents in Metro Vancouver continue to rise. In November, Metro’s average one-bedroom rental unit rose $61 from the previous month to an all-year high of $2,317 per month, according to Liv.rent.

Victorian co-operative and market rents are 10-12% lower than the average of the five cities. However, similar dynamics occurred as market rents rose. Average monthly rent for one-bedroom co-ops, which was about $160 lower than the initial market, fell about $400 in 2019-21. For a two-bedroom unit, the difference was initially $200, but has recently increased to over $600.

Co-op CEO Tom Armstrong said, “Because co-ops are relatively affordable, the cost of government support for low-income households in co-op housing is higher than that of the same households in the private market. It will be much lower than helping.” BC Housing Federation

In the decades before 2014, few cooperatives were built. The addition of new cooperatives in Vancouver since the establishment of the Community Land Trust in 2012 may have slowed the decline, but the federal government does not have data to show this.

In recent years, various attempts have been made to keep co-op units from getting lost in the civilian market.

A Vancouver co-owned property named Aaron Webster has been transferred to Olympic Village and Trust with no net loss to the unit.

Another co-op in Vancouver, Ashley Marr on Cumbie Street, worked with developer Intracorp on a plan to maintain and increase the co-op unit. She transferred the land to Intracorp so she can build new homes, replace her 54 existing units in the cooperative, and add 71 new low-cost units. Located near the Skytrain’s Marine Drive Station and Marine Gateway Complex, the project began construction in October and is expected to be completed in 2025. Operated by the co-op.

In July, the Trust worked with the City of Burnaby and BC Housing to provide 425 units for seniors and low-income residents by purchasing three co-op buildings when the Operating Engineer Pension Plan was selling them. maintained communal housing.

The federation said it is currently working on several cooperatives that are in danger of being sold to the private sector in Coquitlam.

Vancouver has 113 non-profit housing cooperatives, representing approximately 2% of all households and 5% of all rental households.

jlee-young@postmedia.com

More news, less ads: Our in-depth journalism is possible thanks to the support of our subscribers. For just $3.50 a week, get unlimited add-on access to The Vancouver Sun, The Province, National Post and 13 other Canadian news sites. Subscribe now and support us: The Vancouver Sun |