A shortage of student housing was once a big problem for Waterloo.
Now, however, we're told the city may soon suffer from the only thing worse than a shortage of student beds — an oversupply. When will the calamities end?
According to a recent town and gown committee report for the City of Waterloo, current demand for student housing sits at 31,429 beds. Total supply of rental units is 32,625 beds, for a surplus of 1,200 beds. New projects in the planning or construction phase could push it even higher.
This potential tsunami of surplus student housing has local university officials worried.
"If we get into a situation where we've got a lot of oversupply, then you end up with empty rooms or situations where people living together don't know each other because they didn't intend to move in together," Chris Read, associate provost-students at the University of Waterloo, told The Record.
David McMurray, vice-president of student affairs at Wilfrid Laurier University, claimed student housing vacancies "would not contribute to the success of students."
Beyond the devastating prospect of students living lonely lives and failing exams, a Record editorial headlined "Beware of a glut of student housing" lamented that the entire Northdale neighbourhood near both campuses could become "a forest of towers with too few occupants."
It all sounds like some bizarre, end-of-days movie script in which the last student left on Earth battles mutant wolves in an abandoned city while struggling to maintain a grade-point average sufficient to get into grad school.
Then again, perhaps it's worth reminding everyone wringing their hands over too much student housing that such a thing is not a real problem.
Oversupply is not a problem for students. Or parents. Or anyone else who might be interested in the supply of affordable housing in our region. It's a good thing, folks!
Even if, as is predicted, there's a temporary mismatch between beds and bottoms, the housing market is perfectly capable of sorting this out by itself. In fact, recent data from the Canada Mortgage and Housing Corp. shows the apartment vacancy rate in Waterloo Region shrank from 3.6 per cent to 2.9 per cent over the past year. If anything, we're due for more supply.
Recall that just a few years ago, there was a serious shortage of student housing in Waterloo as the two local universities expanded rapidly. Given existing restrictive zoning laws, the private sector response was to focus on a variety of non-standard options, such as basement apartments and lodging homes.
This in turn led the city to impose new and even more restrictive zoning policies. Which prompted an Ontario Human Rights Commission inquiry into whether this discriminated against students. (It ruled it did.)
Then came the grand redesign of the entire Northdale neighbourhood in 2012, which allowed developers to construct new apartment buildings up to 25 storeys tall to accommodate students. To sweeten the pot, the city threw in attractive financial incentives.
The evidence of this strategy can be seen in the vast number of new buildings that have gone up in the past three years, as well as those still under construction.
But now we're told the whole thing has gone too far.
In fact, the real problem in Waterloo is not whether there's too much or not enough student housing, but the underlying assumption that nothing can happen without government deciding what the exact right amount should be.
It was city zoning laws that created the shortage in the first place. When new laws and subsidies sought to redress the problems created by the old laws, the result is complaints that we now have too much supply.
Less government would have solved this problem a lot quicker than more government. The private sector housing market, rather than any bureaucrat, is always better situated to decide where and how much to build.
As for the current situation, I have no idea what university representatives Read and McMurray mean when they fret that an oversupply will harm students. This complaint has no basis in economics or common sense. It appears to be administrative gibberish.
How exactly will building owners force students to move into empty buildings? In my experience, students are herd animals who seek out their own kind in large numbers.
And if it turns out there are more beds than students, the market is perfectly capable of repurposing student housing to other uses. Landlords always prefer full buildings and will inevitably market their product farther afield. Plus prices will come down.
Many of the student housing units I have seen consist of three, four or five individual bedrooms sharing a common kitchen and living room. Most have ensuite laundry facilities or other modern conveniences. Such a layout seems ideally suited for easy conversion to family-style apartment dwellings for young or immigrant families, two demographics most in need of cheap housing.
Perhaps some of the apartments currently built with students in mind will end up housing other folks. If so, then a lot more people will have access to affordable rental accommodations in Waterloo's urban core.
Repeat after me: this is not a problem.
