Montreal City Weblog

Kate 09:23 on 2024-06-20 Permalink Reply  

• Nicholas 10:26 on 2024-06-21 Permalink

  “Despite Quebec having the fewest housing starts in Canada last year, the number of residential units built in the last decade still surpassed growth of households. But empty units are still out of reach for many due to skyrocketing rents.”

  The number of residential units must, by definition, be larger than the number of households, because each household has a separate residential unit. If you have a 2% vacancy rate, to maintain that while adding 1,000 households you need to build 1,020 residential units. So building more units than households being formed could still be so little that things are worse. There could be lots of people who want to form new households (kids want to move out of their parents’, roommates want their own place, refugees staying with people, etc) and they can’t. We’ve grown more in the last five years population-wise than we have for any or almost any period in the last half century.

  While landlords are obviously going to set rent as high as they can, they’re not more greedy than they were 5 years ago, they just have more opportunity because the vacancy rate is so low. It’s not just supply and demand, but in high quality studies in Finland, Austin, Twin Cities and elsewhere, if we can build enough supply for the demand that’s hiding in plain sight, the vacancy rate will go up and rents will go down. And then people who still need help, we can give them money.

• Ramsay 10:47 on 2024-06-21 Permalink

  I wonder how much rents are driven be perception rather than actually vacancy rates. Right now everyone is talking about rental increases, so are landlords more likely to propose higher rates than they normally would? Similarly will renters look at those higher rents as being in line with expectations?

• Ramsay 12:04 on 2024-06-21 Permalink

  To the greed article, I’m certainly not surprised.
  I wonder what the difference is in labour’s costs between a low cost and up market construction. It probably doesn’t take much more time to do a kitchen with granite and high end cupboards than their cheaper versions, but the builder will make more because of their margin on the materials.
  In a context where labour’s a big limiting factor it only makes sense for businesses to serve the segment where they have the highest margins. They will only build cheaper units when the higher price market is saturated.

• Tim S. 14:13 on 2024-06-21 Permalink

  One thing I heard about construction costs is that, between the units being sold and delivered, high-end buyers have more thoughts and changing-of-mind about what they want their unit to look like which both drives up costs and delays completion. Delivering a cookie-cutter rental is probably much simpler even if the structural basics are the same.