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| Former Mayor, Karen Farbridge. Photo from a U. of G. website, cropped by Bill Hulet. |
Hulet: I'd like to change the focus a bit, to talk about what I believe is a housing crisis in Guelph. I know that I'm tremendously unpopular with people when I say this, but it seems to me that we simply aren't building enough housing in this town. So I'm a big fan of just putting in the damn towers and build a lot of apartments to get some capacity out there. What do you think of that?
Farbridge: First off, I think that having the conversation at the municipal level is the wrong place to have it. During the elections everyone gets on the affordable housing band wagon, and says we are going to bring in more affordable housing---and they have zero policy or fiscal levers to move at a municipal level. What are you going to do? Increase property taxes, including people who are on the edge of being able to live in their own homes? Do you want to increase their taxes and make it unaffordable for them to keep their home? Push them out of their house?
You're unpopular with your point of view. I'm unpopular when I get candidates coming to me for some advice about how we can respond to the affordable housing issue. "What should I be saying?" My response is that you shouldn't be responding at all---because there's nothing you can do.
[Karen offers a despairing chuckle.]
And you're just misleading people, and you're just continuing to let people think that there's something a municipality can do.
Now there's little things that they can do---it's not like there's nothing---you can subsidize fees for Habitat for Humanity. I'm not dissing Habitat for Humanity, but they're not going to solve the problem, right? They do good work and help a few families---that's great---but they're not going to solve the affordable housing problem.
To me the affordable housing problem is tied to income inequality.
Hulet: That's certainly something I identified in my research. The top 30% is doing just fine, thank you. But the bottom 30% is in real trouble. And the bottom half has seen any income increase massively out-paced by the increase in housing costs.
Farbridge: The supply will be there, it's people can't afford it. It's an income issue, because of the widening gap. Even in my work with Meridian---all of these new rules that are coming in, tightening up the mortgage rules---right?---based on what happened in the U.S.. People are critical about these rules because they are making housing less affordable. But the mortgages weren't affordable before---they didn't have the incomes to support them. The rules are just acknowledging that the homes aren't affordable---which is a result of the income gap.
So for me, the lever is "how do you address the income gap?" Not unemployment---the income gap, and, inequality.
Hulet: I got this idea from a Parliamentary research paper on housing affordability where they mentioned the concept of "filtering" and housing supply. The idea is that if you have an adequate supply of housing, a certain amount of buildings will become priced less and less. I'm thinking of the sort of places I lived in as a student---which were run down houses and apartment buildings. If you don't have enough supply, filtering ceases, and the pool that already exists shrinks due to gentrification.
Farbridge: Trickle down housing?
Hulet: Yeah.
[Karen laughs.]
I tend to quote from that article somewhat out of desperation. If the Feds and the provinces won't do anything, then that leaves it up to the municipalities---or nothing will get done.
Farbridge: Unfortunately the city doesn't have the legislative or financial tools to be able to do a lot.
&&&&
I think it might be useful at this point to expand some of the points that Karen and I were discussing here so the reader doesn't get confused.
The first point to remember is that the phrase "affordable housing" can mean very different---but intimately related---things: social housing (ie: housing subsidized by the county) for people with significant economic disabilities and privately-owned, non-subsidized housing for the lower-income working class. These two groups tend to overlap somewhat, because there is always a certain number of people who are either working poor who temporarily have to access social service, and, others who use social services who manage to get work that draws them up into the ranks of the working poor.
I am pretty sure that Karen is mostly referring to "social housing" in her remarks about the need for federal and provincial funding being needed. It certainly is the case that it cannot be build exclusively through the use of locally-raised money. As she points out, above a very modest level it just becomes an exercise in "robbing Peter to pay Paul". But having said that, I also have the statement by Liz Sandals to the effect that there needs to be some local money put into social housing simply because federal and provincial money is almost invariably tied to the city putting in some of its own.
What I'm talking about, in contrast, is "affordable housing" as being rental housing that lower income people, in general, can afford to rent. And that, I believe, is related to the issue of supply and demand with reference to the total stock of housing in a city. The idea is that if a city doesn't allow developers to build enough housing for everyone, intense competition will develop for the existing stock---which will drive up the prices to the point where lower incomes people not longer can afford housing. Another side effect is that what new construction is being built will tend to be aimed at the higher income market---simply because the returns are higher on it. (Think about it. In a world where everyone was clamoring for a watch, but where the government only allowed fifty watches built in a year, which ones would a business sell: Rolex? Or Timex?)
This isn't to say that any developer will build very inexpensive new construction. Instead, as economists explain it, there will cease to be competition by renters driving up prices and encouraging gentrification; and instead competition between landlords will drive rents down and encourage owners to defer upgrades on older, existing housing stock. This last process is called "filtering", and is the direct opposite of gentrification. It isn't a difficult concept to understand, but it rarely gets discussed in conversations about housing affordability. It's easy to understand why.
I can remember being invited to a provincial focus group about the Places To Grow Act where the intensification goals for the downtown were being discussed. I was the lone voice raising concerns about housing affordability and I used the example of the old downtown Diplomat Hotel. By all accounts it was a dreadful place to live. But it was affordable for very low income people. Now it has been totally renovated and all the people who used to live there have been dispossessed. I can understand that no one on city Council wants to stand up and defend decrepit, old, nasty, apartment buildings. But the fact of the matter is that those places are part of a continuum that allows low income people a place to live. And that continuum goes through the sorts of crummy houses, apartments, and, rooming houses that I lived in when I was a student and poorly paid janitor. Middle class people might turn their noses up at such places, but if we don't provide for their existence---and won't pony up the money to pay for social housing projects---where are the poor supposed to live?
Karen said "The supply will be there, it's people can't afford it". I'm not so sure about that. The Places to Grow Act and the city plan has put a cap on suburban sprawl---as it should for environmental and cost-of-servicing reasons. This means that the only way for the city is to grow "up"---to use her language. But there is a lot of push-back by the citizenry on that. Every time a developer seeks to build a tower or large apartment complex a mob shows up at Council to complain bitterly about things like parking, shade, build design, etc. Some of this is legitimate. (I can certainly see that on street parking has dramatically changed in my neighbourhood because of condo owners who were too cheap to buy enough parking spaces for their---often extremely expensive---vehicles.) But the "macro" effect on the housing stock is that all this "citizen engagement" dramatically slows down the rate at which developers build new housing, which means that no market pressure gets built up to push down rents and encourage filtering.
As an experienced politician, Karen has to think about what the electorate will allow her to do---not what the optimal policy would be. Voter turnout is relatively low in municipal elections, and the people who do vote tend to be disproportionately older people who already own their own homes and who are fixated on preserving their property value and making sure that their neighbourhood never changes. This means that it's likely that they will badly punish any Councilor or Mayor who was publicly associated with developers building large towers in order to preserve crummy old "welfare hotels" and rooming houses. So it's very easy for an armchair philosopher like me to suggest all sorts of theoretical solutions to public policy. (I've tried many times and only shown that I couldn't get elected dog catcher.) When you add in the political element it's easy to come to the conclusion that there really isn't anything that people on the local level can do to build more affordable housing.
&&&&
I put a lot of effort into researching and writing these articles. For example, I started work on this series of articles in December. It's real work and just as tiring as any other job I've had. I hope that they help readers get a better understanding of the long-term issues facing the city. If you'd like to help me with this, why not subscribe on Patreon? Even as little as a dollar a month is helpful. (I'm now getting about 1500 "hits" a month. If all those people gave me a dollar, I'd be rich!) If you don't want to make a commitment, you can put something in the Tip Jar. If you are afraid of using money on the Internet, you can just mail "Bill Hulet" a cheque to "124-A Surrey Street East, Guelph, N1H 3P9".
&&&&
Hulet: So there's very little you can do other than allow developers to run wild---which would cause lots of problems too. It just seems to me that we are a city now and we're going to have to accept a certain number of apartment buildings---and big ones at that. Try squeezing that past an electorate!
Farbridge: We've had some success. I don't know if you remember---it was during the 90's---there was quite a struggle, you were either pro-growth or you were against growth. The problem was that we weren't talking about "how". There was "Smart Guelph" and then after Kate's term [Kate Quarrie, 2003-2006] there was a lot of engagement around our growth strategy, and we had an interactive tool where we could see that if we didn't grow "up" [ie: taller buildings versus suburban sprawl] we'd see how much land would get taken up [ie: paved over]. Then people saw how many natural areas and how much farmland was being consumed by sprawl, so we were able to get a good community consensus about building "up", and that's what you've seen in the downtown, right?
But we're back at needing to do that. The Clair/Maltby development, it's pitted "for" and "against"---there's more than just Clair/Maltby---but there hasn't been this re-engagement of people to look at what the data tells you about how we're growing and to build that consensus again. So we're getting this opposition to growing "up" again.
Hulet: What do you think about Clair/Maltby? It seems that the city wants to intensify there, but I hear people talking about preserving water, and parks---but I'm wondering if it's just a back-handed way of being opposed to intensification.
Farbridge: The problem is the intensification they're doing---the community form is basically a suburban form---squeezed. As opposed to being a true urban form. A suburban form that is high density as opposed to an urban form that is high density.
Hulet: So it's not forming a downtown?
Farbridge: Yeah. It should be forming a downtown. It almost should be a village onto itself. That's what they're not doing; it's an expansion of the suburban model. That's one of the things going on.
The other thing is that it's turned into a planning application. They're not doing policy planning and I had the sense that---you know I don't follow this closely, I just sort of watch from the distance, people talk to me about it, and I can connect the dots---my sense was that it sounds like they were going through a planning application as opposed to doing policy planning. That's when the planning applications come later---to respond to the policy. Right?
Hulet: So is this a question of the old culture reasserting itself?
[Karen offers a despairing chuckle.]
And you're just misleading people, and you're just continuing to let people think that there's something a municipality can do.
Now there's little things that they can do---it's not like there's nothing---you can subsidize fees for Habitat for Humanity. I'm not dissing Habitat for Humanity, but they're not going to solve the problem, right? They do good work and help a few families---that's great---but they're not going to solve the affordable housing problem.
To me the affordable housing problem is tied to income inequality.
Hulet: That's certainly something I identified in my research. The top 30% is doing just fine, thank you. But the bottom 30% is in real trouble. And the bottom half has seen any income increase massively out-paced by the increase in housing costs.
Farbridge: The supply will be there, it's people can't afford it. It's an income issue, because of the widening gap. Even in my work with Meridian---all of these new rules that are coming in, tightening up the mortgage rules---right?---based on what happened in the U.S.. People are critical about these rules because they are making housing less affordable. But the mortgages weren't affordable before---they didn't have the incomes to support them. The rules are just acknowledging that the homes aren't affordable---which is a result of the income gap.
So for me, the lever is "how do you address the income gap?" Not unemployment---the income gap, and, inequality.
Hulet: I got this idea from a Parliamentary research paper on housing affordability where they mentioned the concept of "filtering" and housing supply. The idea is that if you have an adequate supply of housing, a certain amount of buildings will become priced less and less. I'm thinking of the sort of places I lived in as a student---which were run down houses and apartment buildings. If you don't have enough supply, filtering ceases, and the pool that already exists shrinks due to gentrification.
Farbridge: Trickle down housing?
Hulet: Yeah.
[Karen laughs.]
I tend to quote from that article somewhat out of desperation. If the Feds and the provinces won't do anything, then that leaves it up to the municipalities---or nothing will get done.
Farbridge: Unfortunately the city doesn't have the legislative or financial tools to be able to do a lot.
&&&&
I think it might be useful at this point to expand some of the points that Karen and I were discussing here so the reader doesn't get confused.
The first point to remember is that the phrase "affordable housing" can mean very different---but intimately related---things: social housing (ie: housing subsidized by the county) for people with significant economic disabilities and privately-owned, non-subsidized housing for the lower-income working class. These two groups tend to overlap somewhat, because there is always a certain number of people who are either working poor who temporarily have to access social service, and, others who use social services who manage to get work that draws them up into the ranks of the working poor.
I am pretty sure that Karen is mostly referring to "social housing" in her remarks about the need for federal and provincial funding being needed. It certainly is the case that it cannot be build exclusively through the use of locally-raised money. As she points out, above a very modest level it just becomes an exercise in "robbing Peter to pay Paul". But having said that, I also have the statement by Liz Sandals to the effect that there needs to be some local money put into social housing simply because federal and provincial money is almost invariably tied to the city putting in some of its own.
Money arrives for "X" number of new units. The county says to the city "How much money do you have to put up for your share?" And the city hums and haws and says "We don't have any money. Cause we don't have a housing reserve. We're not in the housing business anymore. Why would we have a housing reserve?" They actually used to have a housing reserve and got rid of it when it got uploaded to the county. But the county says "But we have a housing reserve and we'll put it into the county.So what we have here is a classic political disagreement between Sandals and Farbridge. Sandals seems to believe that there is some room to raise a little tax money to put into a social housing fund, but Farbridge is arguing that there isn't and I suspect at the back of her mind is the political cost that anyone would have to pay in order do so. Since both politicians were part of governments that fell victim to populist "tax fighters", it might be that Karen is right. But I would at least like to point out that whenever a politician tells you that he wants to "keep a lid on property taxes" while at the same time saying that he is committed to fighting homelessness that there are times that the two commitments are at odds with one another.
What I'm talking about, in contrast, is "affordable housing" as being rental housing that lower income people, in general, can afford to rent. And that, I believe, is related to the issue of supply and demand with reference to the total stock of housing in a city. The idea is that if a city doesn't allow developers to build enough housing for everyone, intense competition will develop for the existing stock---which will drive up the prices to the point where lower incomes people not longer can afford housing. Another side effect is that what new construction is being built will tend to be aimed at the higher income market---simply because the returns are higher on it. (Think about it. In a world where everyone was clamoring for a watch, but where the government only allowed fifty watches built in a year, which ones would a business sell: Rolex? Or Timex?)
This isn't to say that any developer will build very inexpensive new construction. Instead, as economists explain it, there will cease to be competition by renters driving up prices and encouraging gentrification; and instead competition between landlords will drive rents down and encourage owners to defer upgrades on older, existing housing stock. This last process is called "filtering", and is the direct opposite of gentrification. It isn't a difficult concept to understand, but it rarely gets discussed in conversations about housing affordability. It's easy to understand why.
I can remember being invited to a provincial focus group about the Places To Grow Act where the intensification goals for the downtown were being discussed. I was the lone voice raising concerns about housing affordability and I used the example of the old downtown Diplomat Hotel. By all accounts it was a dreadful place to live. But it was affordable for very low income people. Now it has been totally renovated and all the people who used to live there have been dispossessed. I can understand that no one on city Council wants to stand up and defend decrepit, old, nasty, apartment buildings. But the fact of the matter is that those places are part of a continuum that allows low income people a place to live. And that continuum goes through the sorts of crummy houses, apartments, and, rooming houses that I lived in when I was a student and poorly paid janitor. Middle class people might turn their noses up at such places, but if we don't provide for their existence---and won't pony up the money to pay for social housing projects---where are the poor supposed to live?
Karen said "The supply will be there, it's people can't afford it". I'm not so sure about that. The Places to Grow Act and the city plan has put a cap on suburban sprawl---as it should for environmental and cost-of-servicing reasons. This means that the only way for the city is to grow "up"---to use her language. But there is a lot of push-back by the citizenry on that. Every time a developer seeks to build a tower or large apartment complex a mob shows up at Council to complain bitterly about things like parking, shade, build design, etc. Some of this is legitimate. (I can certainly see that on street parking has dramatically changed in my neighbourhood because of condo owners who were too cheap to buy enough parking spaces for their---often extremely expensive---vehicles.) But the "macro" effect on the housing stock is that all this "citizen engagement" dramatically slows down the rate at which developers build new housing, which means that no market pressure gets built up to push down rents and encourage filtering.
As an experienced politician, Karen has to think about what the electorate will allow her to do---not what the optimal policy would be. Voter turnout is relatively low in municipal elections, and the people who do vote tend to be disproportionately older people who already own their own homes and who are fixated on preserving their property value and making sure that their neighbourhood never changes. This means that it's likely that they will badly punish any Councilor or Mayor who was publicly associated with developers building large towers in order to preserve crummy old "welfare hotels" and rooming houses. So it's very easy for an armchair philosopher like me to suggest all sorts of theoretical solutions to public policy. (I've tried many times and only shown that I couldn't get elected dog catcher.) When you add in the political element it's easy to come to the conclusion that there really isn't anything that people on the local level can do to build more affordable housing.
&&&&
I put a lot of effort into researching and writing these articles. For example, I started work on this series of articles in December. It's real work and just as tiring as any other job I've had. I hope that they help readers get a better understanding of the long-term issues facing the city. If you'd like to help me with this, why not subscribe on Patreon? Even as little as a dollar a month is helpful. (I'm now getting about 1500 "hits" a month. If all those people gave me a dollar, I'd be rich!) If you don't want to make a commitment, you can put something in the Tip Jar. If you are afraid of using money on the Internet, you can just mail "Bill Hulet" a cheque to "124-A Surrey Street East, Guelph, N1H 3P9".
&&&&
Hulet: So there's very little you can do other than allow developers to run wild---which would cause lots of problems too. It just seems to me that we are a city now and we're going to have to accept a certain number of apartment buildings---and big ones at that. Try squeezing that past an electorate!
Farbridge: We've had some success. I don't know if you remember---it was during the 90's---there was quite a struggle, you were either pro-growth or you were against growth. The problem was that we weren't talking about "how". There was "Smart Guelph" and then after Kate's term [Kate Quarrie, 2003-2006] there was a lot of engagement around our growth strategy, and we had an interactive tool where we could see that if we didn't grow "up" [ie: taller buildings versus suburban sprawl] we'd see how much land would get taken up [ie: paved over]. Then people saw how many natural areas and how much farmland was being consumed by sprawl, so we were able to get a good community consensus about building "up", and that's what you've seen in the downtown, right?
But we're back at needing to do that. The Clair/Maltby development, it's pitted "for" and "against"---there's more than just Clair/Maltby---but there hasn't been this re-engagement of people to look at what the data tells you about how we're growing and to build that consensus again. So we're getting this opposition to growing "up" again.
Hulet: What do you think about Clair/Maltby? It seems that the city wants to intensify there, but I hear people talking about preserving water, and parks---but I'm wondering if it's just a back-handed way of being opposed to intensification.
Farbridge: The problem is the intensification they're doing---the community form is basically a suburban form---squeezed. As opposed to being a true urban form. A suburban form that is high density as opposed to an urban form that is high density.
Hulet: So it's not forming a downtown?
Farbridge: Yeah. It should be forming a downtown. It almost should be a village onto itself. That's what they're not doing; it's an expansion of the suburban model. That's one of the things going on.
The other thing is that it's turned into a planning application. They're not doing policy planning and I had the sense that---you know I don't follow this closely, I just sort of watch from the distance, people talk to me about it, and I can connect the dots---my sense was that it sounds like they were going through a planning application as opposed to doing policy planning. That's when the planning applications come later---to respond to the policy. Right?
Hulet: So is this a question of the old culture reasserting itself?
Farbridge: No, I think this is a question of administrative leadership---it's the individuals more than anything. I don't think it's a Council-driven thing. I don't think it's political---I think the governance is absent, so they're able to do this.
So I asked a Councillor about this, and I said "We had articulated a vision for the secondary plan---it was to be an urban village---that's not what you're proposing for this." The response back was "But that's not what the developers are planning to build".
[Karen laughs.]
It's not about what the developers are planning to build---it's about what the policy that we are going to approve, and then they respond to that policy. And this Councillor had completely bought it---that we have to develop the policy to support what the developers want to build. We've seen subdivision plans for the areas that they own---and it's what they want to build.
So it's backward.
Hulet: This is the traditional culture of developers proposing and Council disposing.
Farbridge: Yeah. We created a plan for the downtown and we've had some incredible developers step into the space to deliver on our vision. Right?
Hopefully with the Guelph Innovation District they've got a good secondary plan there, we'll be seeing developers like Windmill. There's more those emerging---their still a minority---but they will step into the space and deliver once they know what the rules are.
But given their druthers---and particularly some of them in town like [name deleted]. ---Whoops! This is on the record, right?---some of the developers who have not made the switch to urban development would prefer to build in the suburban model because that's their business plan. Their whole supply chain serves that. Whereas Fusion---which I can say---
Hulet: The people at the old Woods site?
Farbridge: Yeah. They still do home building, started off as [single, detached houses] home builders---but they had to switch up their business model to do that.
Hulet: I thought they got pushed by the local community---.
Farbridge: No, the did a great job on engagement, but they were also responding to the secondary plan. The secondary plan said that's what we want there.
There were some secondary things that the community engagement helped with---such as access and bridges and things like that. But the main elements were from the secondary plan. That's an example of a developer who stepped up and delivered the vision of the secondary plan.
&&&&
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| This is the front of the Fusion Homes site on Arthur St, (the old Woods site.) Photo by Bill Hulet |
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| Here's a shot of the same property from the rear, facing the Speed River. The old stone building at the end of the lane is the Spring Mill Distillery. Photo by Bill Hulet |
Farbridge: Yup. Not all of them.
[Karen laughs.]
Some of them with bitch and complain to the end of days. But there will always be the clever businessman that recognizes an opportunity and switches up their business model to deliver.
I think this post is already a bit longer than some people like to read---and this is a good place to stop---so I'll leave off here. Farbridge still has some interesting things to say, but I'll leave that for the next post.
&&&&
Furthermore, I say to you---climate change must be dealt with!
