Housing is expensive in Vancouver – exorbitantly expensive. Prices are dropping but purchasing a single-family home on their own remains out of reach for most residents. Other major cities face similar problems when it comes to affordability – San Francisco, Toronto, Seattle, New York and Boston to name just a few in North America. Faced with this unfortunate reality, what is a young person to do – especially someone who loves city life and is not content to seek refuge in the suburbs? The answer is to get creative and devise and embrace new concepts that confront the housing affordability problem head-on.
Here are a few of the more creative housing concepts that have emerged recently:
1. Vehicle Ranching
In Seattle, a city that has declared a state of emergency with respect to its homeless population, the Seattle Times recently reported on landlords who rent recreational vehicles (RVs) and other vehicles parked throughout industrial neighbourhoods to the homeless. This practice of “vehicle ranching” may be indicative of the times, but the City has plans to fight this unregulated, underground economy that is “drawing anger from business owners and residents alike.” Purchasing your own, non-derelict RV is another way to keep a roof over your head when the cost of home ownership and/or renting is prohibitive.
2. Collective Housing Arrangement
As the demand for affordable housing grows, collective housing arrangements among unrelated adults are increasing in popularity in Vancouver. A group of friends or like-minded adults get together to split the rent and utilities. In most instances, the mutual support spills over into their personal and social lives and these new-age roommates often end up supporting one another much like any loving family. The problem with collective housing in Vancouver is that outdated bylaws that restrict housing among unrelated individuals remain on the books and are subject to inconsistent enforcement.
3. Split Ownership of Vacation Homes
There are, of course, folks with enough income and assets to afford a city like Vancouver, but the high cost of housing here leaves them short on funds when it comes to owning a vacation home. A few millennials are solving this problem by investing in second homes with friends and families in co-ownership arrangements – sharing the down payment, expenses and chores that accompany a second home. Money/Consumer Global News reports that “Split ownership of vacation homes – call them cottages, cabins or camps – is not new. But the arrangement is becoming very popular with millennials…” In addition to the obvious economic advantages, Romana King, Director of Content at Zolo Realty, believes that “One of the biggest pros to owning vacation properties with family and friends is replicating that extended family feel that I don’t think a lot of North Americans get anymore.”
4. Empty Nesters and Empty Rooms
While everyone waits for the arrival of affordable housing units, one solution is for empty nesters and others with rooms to spare to rent out rooms and secondary suites where local rules allow. In theory, this arrangement can serve as a financial perk for both the landlord and tenant.
5. Life in a Truck
In his blog, “Thoughts from Inside the Box“, “Brandon”, a 25-year old Bay Area engineer writes of his decision to purchase and live in a $10,000 16-foot box truck as an alternative to plunking down $2,000/month to share a room in the area’s overheated market. Brandon notes that “The truck is always forcing me to learn new things, both about myself and the world I live in. Stuff like how to live more simply, or figure out what makes me happy or organize my finances to (attempt to) retire early.” This lifestyle certainly is not for everyone, but hey, keep on truckin’ Brandon.
6. New Wave Proptech
The world of real estate and real estate investment is in an era of revolutionary change. You may not be ready to live in an RV, truck or houseboat, but you may be open to other concepts of collective ownership and sharing. Tiny houses, pallet houses, container-living and eco capsules are just a few of the new housing concepts that are already a reality for some folks.
Just as people and planners need to rethink the way we house ourselves; investors need to recognize that times are changing, and opportunities exist to reinvent real estate investment norms and practices. Start-up proptech (property technology) companies are shaking up the real estate world, disrupting the old order and rewriting the rules for buying and selling real estate.
As many urban dwellers are looking into shared, collective living arrangements, so must investors through vehicles such as IMBY that promote real estate investing for as little or as much as your budget allows. If you can’t afford to buy the whole pie, why not have a slice? In fact, maybe a slice is all you really need. And isn’t a delicious slice of pie best enjoyed when shared in the company of others?