condos bad for housing market?

Question

I have seen it mentioned in the press, but I don't quite understand how having condos makes it harder for people to make living cost meet.

http://www.connect2edmonton.ca/forum/viewtopic.php?p=45053
[Vote Homeless
Rally calls for affordable housing for province's 2,600 homeless

Amanda Ferguson, edmontonjournal.com
Published: Wednesday, June 27, 2007

About 100 people gathered today on the steps of the Alberta legislature to call for more affordable housing and give the province's estimated 2,600 homeless a chance to get off the street.

The Vote for the Homeless Rally drew homeless people from past and present, as well as a variety of social service workers and volunteers who see the affects of skyrocketing rent prices daily.

The event was organized by Albertans Demanding Affordable Housing and self-proclaimed street pastor Pedro Schultz.

Protesters held signs saying "Homes for all, equality for all" and "Less condos, more homes" and marched around the grounds before stopping to hear speeches from homeless advocates and those living on the street. ]

Answer 1

Not sure if your question is about social responsibility to provide afforable house or more about, if condominiums are a good real este investment or housing option.

Affordable house is a very big problem all over the world, more so in areas of big gaps between the lower income levels and the avarage cost of living.

Living in Victoria BC, we have similar issues her as in the text you have in your question.

To put it bluntly, to expect developers to build affordable housing is like hoping to find a winning lottery ticket, not happening.

Why not, easy, they can afford to do it, and there is no money in it.

first off can't afford it, the land cost in higher density areas, are so high that it is all but impossible to built anything affordable. then most if not all cities, charge very high fees, to obtain permits to built anything which adds to the costs,

then there is the simple concept of supply and demand, any property is worth what a ready willing and able buyer will pay for a property and the lowest price a seller is willing to let the property go for.

Now does that mean we can't do anything about affordable housing, off course not.

Obviously we need the combined community, political and infractructure willingness and ability to get past some big issues.

In the 70' and early 80' we had federal tax incentives to allow investors to move losses from designated investments to offset profits in other, and by doing so lower their taxes in real estate we called them MURB's they where a great incentive for investors to build rental housing.

In other areas in north America, cities are offering some of their own land in partnership with builders to build affordable rental housing,

there are a good number of old buildings in towns owned by the cities and or some level of government (school boards), that could easily be converted to social or afforable housing.

Locally in Vicotria, manufactured homes are about the most affordable housing ownership option, however we have a number of towns that actually have bylaws banning the building, installing and creating of manufactured home sites.
So most of the manufactured home parks are in fact on native land.

which in its own right is a very interesting observation, that native bands in fact have become a great resource for affordable housing......... makes you think does it not,

I personally feel that we can learn a lot from social housing options available in Europe, where, for example, larger pension funds, and big employers are very often in partnerships to build and provide low cost housing for current and former employees

so when political will and savy creative socially responsible will meet, there are many options and opportunities to build and provide affordable housing.

Now on the other topic, are condo's good housing investments, the short answer is simple.

they are for those that have no other financial option, they tend to be more affordable than single family homes, and there are less responsibilities attached to them. they therefore offer one of many housing options.

I hope I have shed some light on some aspects to your question.

Answer 2

For SELLERS of typical housing, condos can dilute the housing market with a lower priced, more affordable alternative to typical housing. This can ultimately put a downward pressure on the market value of all housing in an area which can be bad for sellers.

For BUYERS, condos can be a double-edged sword. They can be good for the very reasons just mentioned above. BUT, if over-built, condos may not appreciate in value as well as a typical home and can be difficult to sell at all in a condo saturated market. That's why so many condos eventually become rental properties. And too many rental properties in a given area can, itself, be harmful to the overall housing market.