Our family has lived in some pretty diverse neighborhoods both in Canada and Australia, and typically, we’ve found that those with the highest diversity have also been the most vibrant. The idea that single family housing is the norm is a product of cheap oil and the spread of the baby boomers across the suburbs…
In reality, healthy cities and economies must finely balance the need for diversity and the requirement for sameness. A shift in equilibrium in either direction can be detrimental, increasing exponentially as one reaches an extreme.
With regards to housing, the discussion of affordability is directly connected to issues of urban diversity at a number of different levels. As we all know, Vancouver’s prosperity has forced upward pressures on housing costs for decades. In recent years, the surge in real estate prices, the declining share of rental housing stock, and the disappearance of senior governments in building new social housing, have compounded Vancouver’s affordability problems. While there has been a prolonged residential construction boom, much of this is aimed at the high end of the market, thus serving to exacerbate affordability trends.
Affordability requires a strong market demand for housing to offset the cost of developing the more affordable housing stock. Without an offset, profits will be lower or non-existant – and if you were a private developer would you be investing in a high or low return investment? Admittedly, one could say that affordable housing is a lower risk option for investment in real estate development, as the demand will always be there, but the risk of cost overruns on the development would preclude this from being a viable investment strategy for “low risk”.
Some municipalities have required that developers provide a proportion of the housing stock in a development to be “affordable”, this may help with a small percentage of the required housing and with the necessary diversity, but more incentives are required to encourage developers to create truly affordable housing in places of meaningful work and lifestyle.