Lovely Commercial Drive in Vancouver, BC.
Lovely Commercial Drive in Vancouver, BC. Charles Mudede

When I visited Vancouver, BC late last month, I had a conversation with a tech worker who had recently moved to that city from Montreal. The tech worker, who's also an old friend, was actually mad about the housing situation in Vancouver, the most beautiful city in the Pacific Northwest. He was nowhere near poor but the cost of a house or apartment was way out of his reach.

"I missed making my million," he said to me rather morosely (we were eating brunch at a spot on Commercial Drive, a street that still has a thriving community of small businesses—the same can not be said about Robson or Granville). "That's the only way you can live in this city. You had to have made a million dollars somewhere, somehow. I go to parities and people can tell I did not make that million. I'm not one of them."

This is a tech worker speaking.

In Seattle, we have gotten in the habit of blaming tech workers for making the city expensive. But what Vancouver makes clear is that even that prosperous class of wage earners can be priced out of a housing market. And so it is not a surprise to learn from the Seattle Times "that young tech workers are moving out" of Vancouver and "leaving worried business leaders behind." Why? Because "the price of an average house in the beautiful city nears $1.3 million Canadian."

The standard urbanist in Seattle will read this article and say to him/herself: The problem is that they're not building enough in that city! It is all a matter of supply and demand. The vacancy rate is indeed very low, and so demand is pushing up costs. So, we are to believe that building like crazy will crash property values and, in the aftermath, make the city affordable for the working classes. This sounds like a fantasy. One should, correct, increase density (I prefer developers to NIMBYs anyday) but housing prices are not solely determined by simple economic laws like supply and demand.

To begin with, the rich are so very rich they have little to no relationship with the realities of the base, the main economy, which in Vancouver provides an average income of $70,000. In physics, the effort to bring such extreme states or realities together causes nonsense to come out of the mathematics. Supply and demand, like Newtonian laws, makes sense in certain and very specific situations but not in others. And certainly not in one where there is a very large group with a scarcity of capital and a very tiny one with a surplus of it. Vancouver will solve its housing crisis not with economic laws but political ones.