Rents aren't going up because of condo conversions: report
Hamilton’s recent plethora of condo conversions isn’t boosting rent prices or putting a pinch on apartment availability. But the city should keep an eye on it.
That’s the gist of a staff report coming to the city’s emergency and community services committee Monday afternoon.
Rents aren’t higher, and there are still plenty of apartments out there despite nearly 2,000 units being converted to condominiums in the last decade. But it’s important that the market stays that way, said Dave Brodati, manager of investment in affordable housing.
“Average rents in Hamilton have remained relatively affordable,” he said. “Obviously for people with very low incomes, they’re not affordable. But there hasn’t been a very high inflationary impact as a result of condominium conversions.”
The report stemmed from a request by Coun. Terry Whitehead of Ward 8, who worried that condo conversions are putting a pinch on the rental market. He also worries that better rental stock is becoming condos, leaving lower-quality units for renters.
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Whitehead is still worried about that.
“The choice of quality rental spots is becoming very limited,” he said.
Since 2003, the city has approved 20 applications to convert rental housing to condos, amounting to 1,354 units.
It’s given draft approval to another eight applications, totaling 572 units.
Staff is also considering three applications, or 141 units, for condo conversions.
The benchmark for available housing stock is a two-per cent vacancy rate. Hamilton’s rate has been over three per cent for years, Brodati said.
Hamilton’s rents are also affordable compared to other cities.
The city is experiencing an upswing in condo developments, which is sure to result in more owners wanting to convert apartments to condos. That’s why it’s important to keep assessing, he said.
And Hamilton does have a shortage of affordable housing.
“There has not been a sufficient increase in the supply of new rental housing to meet the projected growth in the city of Hamilton,” he said. “So any loss of rental housing is a concern.”
The city's emergency and community services committee will hear the report at a meeting Monday afternoon.
Condo conversions by the numbers:
1,354: Number of rental units converted to condos from 2003 to 2013.
572: Number of units that have received draft approval but haven't been converted yet.
141: Number of units the city is considering.
629: Number of new rental units the city needs each year. 377 need to be affordable. Currently, the city is seeing about one-sixth of that.
$724: Average rent in Hamilton per month for a one bedroom in 2013. The average rent for a two bedroom is $867.
3.9 per cent: Apartment vacancy rate in 2013.
$66,405: The amount of tax dollars the city lost when 206 apartments were converted to condos.