Land Supply: Scarce means Dense and Expensive

Transcription

1 Daedalus Analytics Incorporated Written by David Baxter Copyright 2016 Daedalus Analytics Incorporated Way back in the early 1970s the Greater Vancouver Regional District (GVRD) was involved in a long term regional planning process to chart the future of this region. The results of this process was an ambitious set of strategies presented under the title The Livable Region 1976/1986: Proposals to Manage the Growth of Greater Vancouver, published in While there is much of interest in this document, both in an historical context and for what it says about regional concerns today, there is one page (Page 7), reproduced here on the following page, that is particularly cogent in the context of the region s current housing market. The first line of graphics on this page shows the amount of land for building within 35 (56 km) miles of the central city downtown core for three metropolitan regions in Canada. It shows the Montreal metropolitan region having 3,000 square miles (7,770 sq. km.) of land within a 35 mile radius of downtown Montreal. It shows the Toronto metropolitan region with only 1,500 square miles (3,885 square km.) of land within a 35 mile radius of downtown Toronto: the 50 percent difference is that urban growth in this region is constrained on the southern boundary by Lake Ontario. And the graphic shows this region without bothering to draw the 35 mile radius circle, as distance is not the supply constraint here. The graphic states that this region s land supply is only 700 square miles (1813 sq. km.), less than half of Toronto s and less than a quarter of Montreal s. They could have drawn the circle, as it is about 35 miles from downtown Vancouver to the eastern edge of the Township of Langley, which is also the eastern boundary of the Vancouver Census Metropolitan Area (and the GVRD), so the circle would have included one of the metropolitan boundaries. However, there was no point in swinging the circle to the south, as the southern boundary is the 49 th Parallel, which is only 35 km. (22 miles) from downtown Vancouver. Similarly, there was no reason to swing the circle to the north, as the northern boundary is only 10 km. from downtown Vancouver: the North Shore mountains, which supply us with water, with their steep slopes and utility servicing constraints, effectively cut most of the top half of the circle off. And then on the west, well, it is less that 2 km. from downtown Vancouver to the English bay beaches: Burrard Inlet, Indian Arm, English Bay, and the Georgia Strait are effective western constraints to urban development. 1 _Proposals_to_Manage_the_Growth_of_Greater_Vancouver.pdf Disclosure: I was a consultant to the GVRD during the development of the strategy plan; my work was technical, concerned with providing projections of regional population, housing, employment and land use, as well as with modeling the implications of strategy.

2 Land Supply: Scarce means Dense and Expensive Source: Livable Region : Proposals to Manage the Growth of Greater Vancouver p.7 April 2016 Page 2

3 The use of the central city downtown- centered circle is effective as a comparative graphic, but it cannot tell the full story. Yes, the Toronto metropolitan region s spatial growth is effectively limited on the south by Lake Ontario, but east, west, and north it there are no real limits to its potential land supply: it can go beyond 35 miles, moving out 40, 45, or 50 miles. [I am not saying it will or should, only that it could.] Similarly, the Montreal region could consider land 40 or 50 miles away in every direction as part of its land supply. Such a lack of natural constraints characterizes most of Canada s major metropolitan regions: Calgary, Edmonton, Saskatoon, Regina, Winnipeg, Ottawa, all have effectively unconstrained land supplies. Metropolitan Vancouver does not. The constraints on the west (water), north (mountains) and south (USA border) will never change, which leaves the only way to expand beyond the 35 mile limit is to the east into the upper portions of the Lower Mainland in the Fraser Valley Regional District (FVRD), which are subject to exactly the same constraints on the north and east (mountains) and on the south. But these graphics are not the most interesting thing on the page in the GVRD report: on that page, in a document published in 1975, there is a comment, made almost as an aside, that We have enough land for the next 50 years of growth. Forty- one years ago, they said we had enough land for 50 years of growth which means we are only 9 years from running out of land in the GVRD. Whenever the precise date for running out of land is, when it arrives metropolitan growth will present us with two options; increasing densities and/or expansion of metropolitan development beyond the GVRD s boundaries. In some senses, we are already at that point. This has a number of implications for how we look at the metropolitan region. First, and ironically, this means going back to considering the region in the way it was envisioned between 1949 and In this period, the region was, at least in terms of land use, seen from a Lower Mainland perspective, under the aegis of the Lower Mainland Regional Planning Board, whose focus of concern stretched from Bowen Island to Hope, and from the North Shore mountains to the our border with the USA. In the years since then, the Lower Mainland has been divided up into first four regional districts and then two (GVRD and FVRD). Historically, the GVRD could reasonably be assumed to include all of the functional metropolitan area: the homes for the overwhelming majority of people who were part of the metropolitan economy and the overwhelming majority of the places of work for the regions residents were all within its boundaries. Now, however, the functional boundaries of metropolitan development stretch beyond its administrative and census boundaries. Abbotsford and Mission are not included in the GVRD or the Vancouver Census Metropolitan Area: combined they are considered by Statistics Canada to be in their own Census Metropolitan Area, so what essentially exists today is metropolitan development all the way to Abbotsford s boundary with Chilliwack. April 2016 Page 3

4 Land Supply: Scarce means Dense and Expensive Source: hectaresbc.org/app/habc/habc.html Table 1: Land Use in Lower Mainland Regional Districts Human Dominated hectares Urban Fraser Valley 20,200 Greater Vancouver 93,200 Lower Mainland Region 113, % Residential/ Agriculture Mix Agriculture Recreation 10,800 42, ,400 30, ,200 73,500 1, % 33.7% 0.5% Fraser Valley 1.5% 0.8% Greater Vancouver 30.9% 5.1% Lower Mainland Region 6.7% 1.5% Source: 3.1% 10.2% 4.3% 0.0% 0.3% 0.1% Not Human Dominated Other Rural 2,040 2,050 4, % 0.1% 0.7% 0.2% Sub-total Wetlands Glaciers 76,096 6,660 27, ,118 3, ,214 10,500 27, % 1.9% 5.5% 47.0% 12.9% 0.5% 1.3% 0.6% 2.0% 0.0% 1.6% Alpine 162,000 5, , % Water 80,400 20, , % 11.6% 1.9% 9.9% 5.8% 6.8% 6.0% Forest & Other Sub-total Total Area 1,040,000 1,316,460 1,392, , , ,088 1,170,000 1,476,430 1,694, % 74.7% 43.0% 69.0% 94.5% 53.0% 87.1% April 2016 Page 4

5 With the West Coast Express going to Mission and an upgraded TransCanada all the way through Langley Township, these two metropolitan statistical areas are increasingly becoming one. This means that while there are two regional governments and two census metropolitan areas, these are now increasingly artificial boundaries in one large interconnected metropolitan region. For example, 30 percent of the people who live in the FVRD who have a usual place outside the home work in the GVRD: before an image of hours spent commuting springs to mind, two- thirds of these folks are only going to the next door municipalities of the Langleys and Maple Ridge. While folks living in the City of Vancouver may see it as the center of all things, the residents of Mission and Abbotsford don t, as only 2.5 percent of them work in the central city, and they have the West Coast express. By putting aside statistical and municipal boundaries, both the extent of urban development and the land supply for metropolitan areas can be clearly seen. HectaresBC, an agency of the provincial government, provides a really handy way to summarize, both on maps and tables, land use data for regions in the BC. 2 Map 1 shows the topography and boundaries of the two regional districts that include the Lower Mainland, together with the areas within them that are under human domination (red zone): human domination includes land used for urban development, recreation, agriculture, agricultural/residential mix, and other (mining and range land) uses. The fact that the red area is stuck between the borders, the waters and the mountains shows that all of the land in this broad region that can reasonably be under human domination already is. Looking at the data (Table 1) that underlie this map, out of a total area of 1,694,644 hectares, 87.1 percent is not under human domination, and for good reason, as it is wetlands, glaciers, alpine, water, and forest and other non- human domination uses. Only 12.9 percent (218,214 hectares) of these combined regional districts is realistically capable of human settlement, and it already is being used for such purposes. Drop a rectangle on a map of the region that has the dimensions of 130 km by 40 km from Horseshoe Bay to Hope and down to the border. Out of the 520,000 hectares this rectangle contains, only 218,214 hectares (42 percent) can realistically be considered urban land supply 3. Drop the same area of rectangle around Calgary, Edmonton, etc. and all 520,000 hectares are in play 4. In every other metropolitan region in Canada, if you double the size of the box, the area for metropolitan development doubles: in this region, no matter how much bigger you make the box, you do not significantly change the amount of land we have for metropolitan uses. Essentially, our metropolitan future lies in how we use the land that is already under human domination. Of 218,214 hectares under human domination, 113,400 hectares (52.0 percent) are already in urban use, and 99,700 hectares (45.7 percent) are in Figures include urban dvelopment on Bowen Island. 4 For Toronto, it will be necessary to tilt the box to a base that lies along Lake Ontario, and for Calgary it must be tilted to avoid the Rockies to the south west. April 2016 Page 5

6 agricultural use (either distinctly or in a mixed agriculture and residential setting): recreation and other rural uses account for only 2.4 percent. In one sense, there is lots of green field land literally for metropolitan development in the Lower Mainland region, without cutting forests or building on mountain slopes. We could just about accommodate another metropolitan Vancouver in this region without any increase in density if we used the 99,700 hectares of agricultural land in the region, land that is already under human domination, for urban purposes. Of course we won t do this: since 1974 policy has steadfastly confirmed that agricultural land is off limits for urban development: we have, collectively, made a choice to have higher densities and higher prices than we would otherwise have by restricting urban land supply to the 113,400 hectares already in urban use. In comparison with other regions, the natural constraints in this region combined with the preservation and conservation constraints we have chosen, means that we have about 22 percent of the land supply that Calgary and Edmonton have, and we already have twice their population 5. It is no surprise that, all other things equal (such as incomes), our housing prices are much higher than theirs and our residential density is much greater. In one sense, the GVRD was right in 1975: given these constraints, we have pretty well run out of green field sites for urban development, and certainly will have within the next decade. In another sense, though, they were wrong; we will never run out of space, but our new frontiers will be up and urban redevelopment rather than out and urbanizing green fields. Sobering, and something that should inform every discussion about housing densities and prices, is the fact that at some point in time not to far away the historical options of growing up or out will no longer prevail. And this is the point where some people say that we do not have to do this we do not have to grow either out or up, if we just stop the population from growing. Some residents say that there are already too many people in metropolitan Vancouver. Of course, that is not what they really believe; what they really believe is that there are too many other people, for if they really believed it they would help solve the problem by leaving. There is not really any practical point in discussing stopping population growth, as it is not going to happen, at least not in any foreseeable future. No matter how desirable, or undesirable it may seem, population growth in this region will not stop so long as it has its attractive economy and climate. I say this for two reasons, one demographic and one constitutional. The demographic reason is the same one that explains why kids can t find a single detached house to buy in the neighbourhood that they grew up in. This can be 5 The combined population of the FVRD and GVRD is estimated to currently be 2.8 million, compared to the Edmonton CMA and Calgary CMA populations of 1.4 million each. 113,400 divided by 520,000 equals 21.8 percent. April 2016 Page 6

7 demonstrated by considering 20 kids who were together in kindergarten just over two decades ago. Their parents were all about the same age, in their late twenties/early thirties, and all living in 10 single detached houses in, let s say, Dunbar. Fast- forward to today, the parents are in their early fifties, the kids are in their late twenties, and both the its time to be grandparents and its time to be parents clocks are approaching alarm time. Now let us presume the kids want to raise the grandkids back in the old hood, close to the free baby sitting service and familiar parks, schools, and shops. In one scenario, in that charming wedding announcement way, they all marry someone else from that kindergarten class. As the new grand- moms and grand- dads haven t even retired yet, in order for the 10 new couples to live in the neighbourhood they grew up in, 10 new dwellings have to be added to the existing stock in addition to the 10 that all the grandparents live in, increasing its dwelling density and population by 20 adults plus all of the grandkids to come. If rather than following the somewhat narrow marrying one s kindergarten sweetheart model, each of these 20 kids married someone from outside it, but still wanted to raise the grandkids there, then 20 additional units would have to be built to accommodate 40 more adults plus all of the grandkids. Even if only one kid wanted to come back, if the grandparents don t move out to let the kid in 6, the density and population have to increase. There is no way around it, until grandparents move on, the possibility of everyone who grew up in the neighbourhood finding a place in it when they start a family means increasing both its population and its residential density. Writ large, this is a factor in population growth in this region: if people who grow up here want to stay here, and marry someone from perhaps somewhere else, and raise families here, the region s population will grow. But this is not the only source of growth in this region: a lot of people also come from other parts of Canada. While 42 percent of the population of this region were born in BC (Table 2) 7, another 15 percent were born in other parts of Canada: this is a cumulative number, representing everyone who lives in the region now and was born in another province and moved here regardless of how far in the past that occurred. With 33 million other Canadians who have a perennial relationship with block heaters and snow plows, so long as we are the best that Canada has (climatically and scenery wise at least) there will always be folks from beyond the mountains wanting to join us, and there is no way they can be stopped, as they have a constitutional right of mobility within the country. 6 Think of Prince Charles long wait to get back into the house he grew up in. 7 Source: Statistics Canada, Selected Demographic, Cultural, Educational, Labour Force and Income Characteristics, Mother tongue, Age Groups and Sex for the Population of Canada, Provinces, Territories, Census Metropolitan Areas and Census Agglomerations, 2011 National Household Survey X April 2016 Page 7

8 Which takes us to immigration, the source of 40 percent of the region s residents. This is also a cumulative number, representing the total number of people in this region who were born in other countries and who came some time in the past. Some 16 percent of the region s population in 2011 were born outside Canada and immigrated here prior to 1991; 12 percent immigrated between 1991 and 2000, and 13 percent between 2001 and The shares of foreign born who immigrated prior to 1991 are smaller than the decade shares since then in part because immigration levels have been higher in the most recent period and in part because mortality has reduced the stock of these earlier immigrants. Regardless of one s opinion on immigration, from a practical point of view it is going to continue. The Federal Conservative government worked within an annual immigration range of 260,000 to 285,000: the Federal Liberal government is now working with an immigration range of 280,000 to 305,000. Once in Canada, immigrants have the same right of mobility as the rest of us, so we are going to receive some share of these new comers. For the foreseeable future this is not going to change, so there is no real value in talking about no growth in metropolitan Vancouver. We have to face the facts: - the population of this region will continue to grow; - this region has a naturally limited supply of development land compared to other regions in Canada; - we have made choices to limit this supply further through agricultural land preservation; and - land prices and density in this region will be greater than they will in other regions in Canada, all other things equal. We must figure out how to work with what we have within constraints both natural and chosen, rather than wasting our time demeaning ourselves looking for someone to blame. April 2016 Page 8