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Landlords, tenants facing new reality

Olympics have contributed to abundance of rental units now available

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Iain Ross has been looking for the right tenants for three months now. The Vancouver resident maintains a luxury house in Bayshores for his friends - the owners - who live abroad. The two suites in the house were rented out for the six months prior to the Olympics. But since the Games ended the suites, which were going for $5,000 per month for the upstairs suite and $4,000 for the downstairs, have been vacant.

Ross has received only six calls and had no takers.

"I've shown the house to a few people but a lot of people see pictures of the house and when I tell them how much it is, they say, 'My budget's $300,'" he said with a laugh. "Well, obviously it's not going to be $300 a month.

He reduced the rent by $1,000 on each suite to see if he would get any more response. He hasn't received a single call.

The suites Ross is managing may be exceptional, but his experience is fairly typical right now.

Whistler is in the midst of what may be the largest surge in availability of rental accommodation in two decades. It's a drastic reversal in Whistler's rental market from the mad and frantic dash to find accommodation; when stories of people paying $1,200 for a shared room were not uncommon.

"We definitely have more available rental units than we've seen, easily , in the last five years," said Marla Zucht, general manager of the Whistler Housing Authority.

Ross says his friends are financially stable enough that they can absorb the losses from vacant suites without serious repercussions. For many Whistler families however, empty suites mean difficulty paying the mortgage.

"I know a few other people who have higher end places in Whistler who try to rent them out full time and they've been having a hard time," he said.

Nicole Thompson, owner of the Hat Gallery, put the one-bedroom suite in her Nordic Estates home up for rent two months ago. She didn't get a call.

"We were a little bit panicky," she said. "We're young, and in order to pay the mortgage we need that money."

She said that her space, at $1,000-per-month, is on the "lower end" for suites in Whistler.

And that may be precisely why many landlords have had a difficult time renting out their rooms.

"For this season, (rents) are out of whack for the availability versus the prices that are still being asked," said Zucht. "Come winter, will these landlords be able to get those rents? It's hard to say."

"The price definitely needs to come down a bit more," said Whistler resident Lynzee Davies. "People need to understand that it's a renter's market now. They (landlords) don't have the upper hand anymore."

Davies and her boyfriend have been looking for a one-bedroom unit to rent for around $1,200 for Aug. 1. They have viewed a dozen suites so far. A few of these have been quasi-suitable units but they're either too small or located under a family home with children running around overhead.

And all these landlords are looking for someone immediately.

"No one will take anything in advance," Davies said. "They need someone in there to pay their mortgage.

"It's like they want us to sign a lease, like, immediately. They think we're going to take it because that's how it's been in the past, when people were fighting for a place. Now, we just have the pick of them."

Zucht says most of the complaints she hears are from people unable to find a suitable home, despite the amount of availability. The suites are generally too expensive. If they're affordable they're probably inadequate.

"Hopefully, this additional pressure and availability will, yeah, put some pressure on landlords to either spruce up their places or bring down the prices," she said.

 

The Olympic effect

The wide-open renter's market is due in part to the Olympics. This past winter, many of the units that would have been held for longer-term rentals were held back for people who were looking to rent during the Olympics. There was a sudden decrease in room availability starting in October and leading up to the Olympics. Zucht heard a number of calls from tenants reporting landlords who weren't renewing leases.

Most of those suites were released earlier than the WHA had expected. Zucht says they saw "more units than normal" come available in April.

But that's only part of it. Zucht says that many of the people moving into the athletes' village/Cheakamus Crossing - both those who bought and those who are renting - are moving out of rented suites starting Aug. 1.

"We're very clearly seeing the impact of all the purchasers that are going into Cheakamus and Rainbow. A clear majority of those are coming out of Whistler rentals, probably 80 per cent, for Cheakamus crossing," Zucht said.

It also has to do with the 400 new ownership units for sale, not just at Cheakamus Crossing but at Fitzsimmons Walk and Rainbow. Most of those units are available through the WHA and aimed at locals.

Zucht said the WHA had intended three-to-four years ago to stagger when each development was ready. It didn't happen that way and there will likely be an exodus from rental properties, since a majority of new buyers are coming out of rentals.

"The opportunity for locals to be buying their own unit rather than just look for a rental, I think that's had a huge impact."

And there's the economy. Ross manages higher end homes in Mexico and New York as well as in Whistler and he says those have been slow to rent out as well.

"It's tough all over," he said.

"It's indicative of the economy. People who rent higher end houses - and I'd certainly do it too if I was going to be spending that kind of money - would be to just get a room at the Four Seasons, get someone to do my laundry and get a foot rub as opposed to just getting the house."

Zucht says that it's still too early to comment on whether this widespread availability of rental units is a new reality in Whistler or merely an anomaly given the uniqueness of the previous winter season.

"It's going to be the end of September, following Labour Day, and October that's going to be the tell-tale time. If landlords haven't filled their units by September 1 st , it's going to be tougher for them - at least until November, when the next surge of winter employees arrive."

Zucht says that the WHA, which focuses its statistical information on long-term accommodations, has seen rent in Whistler increase "consistently and steadily" over the last decade. She adds that accommodation for locals - particularly for new employees - has been an issue since the early 1990s.

As the town grew and as businesses grew, so too did the need for employee housing. The municipality brought in a bylaw that required any new commercial development to provide housing for employees or cash in lieu. Most of those commercial entities couldn't provide staff housing on site and so paid cash, which went into a housing fund.

That fund grew, and from that the municipality built rental housing and also created the WHA in 1998 to tackle the issue of housing for local employees.

Zucht says the conversation at the Welcome Week dinner in the fall has always been dominated by housing - new arrivals finding work but no home. Some have paid over $1,000 to share a room. Others are forced to share beds.

"I'm hoping that come November when I host the table, I'm not going to hear those desperate stories," she said.