Soaring assessments threaten B.C.’s most affordable homes

Modular home park owners consider selling as allowable rent increases trail higher property taxes

By
Times Colonist
April 24, 2017





B modular homes.jpg
Retiree Lothar Netzel holds a garage sale outside his home at Thetis Lake Campground and Trailer Park. The park’s residents are facing eviction to make way for a proposed high-density housing project. | Darren Stone, Times Colonist

 

Soaring assessments are threatening the viability of the most affordable housing option in British Columbia, warns the executive director of the Manufactured Home Park Owners’ Alliance of BC.

Manufactured homes on rented pads cost about one-tenth of what an average detached house in B.C. costs, and provide thousands of seniors and others with the lowest-cost homes in the province, said Al Kemp, the alliance’s executive director.

That security is in doubt, the alliance’s executive director said, because park owners are under annual rental restrictions while assessed values, and subsequent property taxes, are increasing dramatically.

“Owners are being squeezed,’, Kemp said. Assessment values on manufactured home parks have skyrocketed in the past year, but park owners can increase pad rents by only 3.7 per cent this year under B.C.’s Residential Tenancy Act. 

One owner of a Vancouver Island park appealed to Kemp for help after receiving their 2016 assessment. “We will be out of business soon as our low rent-controlled increases never allow us to catch up,” the owner wrote.

Kemp explained that BC Assessment “doesn’t have a clue” how to value manufactured home parks, which are a hybrid of commercial and residential real estate. The land-value sale of one park, for example, will raise the assessed value of neighbouring parks that may not have the same development potential, he noted. 

“There is a park in Nanaimo where [the assessed value] went up by $1.2 million because of the sale price of another park in the area,” Kemp said.

Some park owners, including longtime owners, are selling their parks for redevelopment, which means residents must scramble to find affordable housing somewhere else. 

Such is the case in View Royal near Victoria where the assessed value of the 18-unit Thetis Lake Campground and Trailer Park jumped by more than $400,000 in the past year, to $2.98 million. 

The owner of the park is now selling to a developer who wants to build 45 single-family homes and 14 townhouses on the 12.5-acre property. Residents are facing eviction by next fall. 

 “We don’t want to leave. It’s basically cheap living, close to a park and we’re comfortable here,” said Lothar Netzel,a retired watchmaker who has lived at the trailer park for 20 years. 

His 600-square-foot home was built in the 1970s, as were several others in the park. Netzel said he looked around at other mobile home parks, which are few and far between these days. Other houses are much more expensive.

The March benchmark price of a detached house in View Royal was $645,000, with a townhouse at $502,000, both up about 19 per cent from a year ago, according to real estate board data. Greater Victoria’s apartment rental vacancy rate is less than 1 per cent. 

The park has been owned and run by the same family for 40 years. Owner Eric Gieringer couldn’t be reached to comment on the future of the property.

But Netzel said a letter to residents in January laid out a plan and compensation.

They were told the park owners had entered into a sale agreement with the Limona Group, a developer that wants to build homes on the property that borders Thetis Lake Regional Park.

Density zoning 

The sale hinges on the development being approved for rezoning from the Town of View Royal. If it goes through, the owner of the campground trailer park has offered each mobile homeowner $10,000 as compensation.

 “What can we do with $10,000?” Netzel asked, pointing to steep house prices and a tight rental market throughout the capital region.

Don Dobbie said he bought his mobile home in 2007 for $44,000 – his foray into home ownership in his early 20s. Over the past 10 years, he has added new siding, installed a new heating system and renovated his kitchen. Last year, he tried to sell the home and had an offer for $89,000, but was told by the landowner no new tenants were being accepted due to the uncertain future of the park and zoning.

Dobbie said he worries about other owners in the park, some of whom are low-income and have disabilities, with few supports.

View Royal Mayor David Screech said that while he sympathizes with the owners, View Royal does not have any mobile home bylaws.

The Thetis Lake property is zoned as a campground and has been able to operate as a trailer park because it predates the town and its rules, he said.

“In my opinion, they have been given a generous offer, more than what’s required by law,” he said. 

Screech said council did direct the park owner to cover the cost of removing the mobile homes. He said that council has looked at the initial proposal from the developer for the property and offered feedback, namely looking for high-density housing and more green space.


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