Politicians debate building heights
Denis Coderre thinks the city should allow buildings higher than Mount Royal, while the mayor does not. It’s entirely typical of Coderre that what he wants it for is to have a “world class downtown” and, only on second thoughts, to help with the housing crunch. His first thought is always to boost Montreal to make himself more of a big shot – and that’s if he gets to be mayor again.
Will adding to the stock of tiny downtown condos actually help the housing crisis? Is that what and where we need to build?
SU 11:32 on 2021-04-25 Permalink
He stated his intention to backtrack the 20/20/20 housing bylaw which I believe has just come into effect. He is worried that an affordable housing bylaw will be hard on the development community..
I guess he hopes to improve the plight of development investors by allowing them a few more floors.
Uatu 11:46 on 2021-04-25 Permalink
Any idea in Montreal that’s touted as world class usually ends up being an expensive white elephant.
Kate 11:53 on 2021-04-25 Permalink
I don’t get the “world class” target. Montreal is an alpha-minus class city. We’re not in the top couple of ranks, and that’s fine! We don’t have the history, the economy, the population or the geography to be in those ranks, and until recently it made the city a lively but affordable place to live. Pushing it to compete with Paris, London and New York risks making the city unlivable for its residents while always trailing Toronto. Is this a competition we even want to be in?
david344 13:18 on 2021-04-25 Permalink
Raising the height limits would be fine, but it’s not going to bring any more housing in a way that impacts the housing crisis. Building that tall is far to expensive to happen all that regularly, and you’ll not see very much of it. What you’d get would be the odd signature or prestige building.
On the other question though, the whole 20-20-20 proposal – it’s a very stupid and goofy plan and it needs to go. We’re not seeing its result yet because all the developers rushed their projects through before it went into effect. But there’s no question that certain projects just don’t pencil out with that policy in place. Why don’t they pencil? It’s not just that you have to sell some units at a lower cost (in some cases than costs to even build them, so that you’re taking a loss!), it’s that you have to make up that lost revenue by increasing the cost of the units you do bring to market. Forget all the extra risk this entails, the key point is that new structures will be built only for the market in which they can sell. So, as a result of this scheme, some projects will pause until the price of housing rises high enough to warrant building, and whatever does get brought to market will be more costly, with knock on inflationary effects across the sector (as new units set the ceiling on the value of existing units).
Plus, for all this disruption they’ve made the classic mistake too: people who get units in these buildings will have to pay the building management fee like anyone else. It’s a classic scenario in other towns with schemes like this (eg. NYC or SF) and shows just how little research PM did before implementing this: monthly building management fees of $800 or $1000 are no problem for the buyer of the $700,000 condo, but challenging for most low income people qualified to buy the $250,000 condo in the same building. So who will really get these units? People who qualify based on their income, but who have significant means – well set retirees, foreigners with undeclared income back home, those whose main source of income is either off the books or passive, and so forth. So the PM position of “poor people who couldn’t otherwise afford it should also get to live a nice new luxury building just like the people who can afford it” is really just going to be a reward for those who manage to game the system.
Just kill this stupid scheme and fix the supply side in the normal way: build enough new housing that the cost of the old housing slides.
Tim S. 13:57 on 2021-04-25 Permalink
David, do you have any examples of places that have done it right, in your opinion?
qatzelok 17:00 on 2021-04-25 Permalink
When I hear the expression “world class city,” my bu****it-detector goes off.
What about yours?
steph 21:54 on 2021-04-25 Permalink
@david344 – “build enough new housing that the cost of the old housing slides.”
In the last six months the cost of building home has increased roughly $50,000. The construction supply industry has just begun feeling the full effect of any shortages. Lets see post-Covid what happens with all that. I suspect prices are simply NOT going to come down.
David658 23:20 on 2021-04-25 Permalink
I wrote a long response to you Tim, but it seems it was lost. Anyway, the key elements there were that Seattle actually did exactly what I’m talking about – huge building boom led to lower rents in many areas, and a very low rate of increase (sub 2%) overall, which is wild. I something about Sacramento, Berkeley, and Oregon too, places I’m following
Steph – the most radical cost increase is the price of lumber. It’s down to a bottleneck at the processing points, and there’s a very good reason to believe this will come down as capacity ramps back up to 100%+ capacity. Namely, raw timber log cost is lower than ever. Various other inputs are higher on higher shipping costs (how stupid is it that we still haven’t developed robust value added capacity to bring our own natural resources to market?) – these shipping costs are already tumbling on the gradual resumption of China-US route frequency.
Kate 10:37 on 2021-04-26 Permalink
David∞ – it’s always a good policy, if you’re writing more than a couple of sentences, to compose in a text file on your own computer then cut and paste.
Tim S. 08:33 on 2021-04-26 Permalink
Thanks David – that gives me something to look into.
Kevin 14:40 on 2021-04-26 Permalink
I heard that demand in Canada was so strong for lumber that last year was the first time anyone remembered hitting the actual quota for harvesting set by the Crown.
At some point this past month the lumber futures were so high that sawmills started buyback programs, getting their wood *back* from lumber yards.
I figure it’ll stabilize when people can spend money travelling again.
Cadichon 16:38 on 2021-04-26 Permalink
David, I agree that raising the height limit dowtown would bring very few more units. But not sure “ending single family zoning” would make a difference in Montreal. Aside from RDP-PAT, Pierrefonds and Île-Bizard, there’s not much land zoned “R-1” in Montréal. (I checked quickly, in Montréal-Nord alone, probably less than 5% of all land.) As for the 20-20-20, there is some confusion in your point : affordable housing in Montréal, unlike in the US, is generally built in a separate structure, through provincial and federal programs. There is no management fee issues.
mare 16:50 on 2021-04-26 Permalink
I found a sheet of ¾” furniture grade plywood at the Home Depot that was cheaper than a sheet of rough plywood commonly used for roofs and floors. I postponed that part of the job for now, I don’t pay $65 for a piece of plywood if I can avoid it.
Building houses is expensive, but I’ve read stories of builders/developers of new subdivisions (in the US) who increased the selling price of every house with 40% after the previous house was sold and it was still sold fast for that price so they increased the price again and again.