Jeffrey Ho, owner of Blight's Home Hardware, has noticed that several of the neighbours along his section of Dunbar Street have moved out, their storefronts remaining empty.

His business is long established, so he's in good shape, but he does wonder what's happening around him.

"The convenience store across the street shut down. We have a couple of empty stores on the next block that used to be furniture places and they've moved on," he says. "I don't know if it's the landlords not giving a reasonable rent or the stores are not getting business. It's a bit weird. But I can't dwell on the past, or I'd be in trouble," he adds, laughing.

Story continues below advertisement

Real estate agent John Gust sold a large commercial property up the block a year ago, but the building's four retail spaces remain unrented. Even the large Starbucks across the street, at Dunbar and 18th Avenue, moved out, and its space remains empty.

"There's just not a lot of flow through that section of Dunbar," Mr. Gust says.

West side neighbourhoods such as Dunbar and Kerrisdale are feeling the effects of the massive housing transformation around them, says David Wachsmuth, an urban geographer who arrived in Vancouver a month ago. As houses are purchased to only stand empty, the spin-off problems are slowly making their way through communities. Empty houses are bad for neighbours, and they're especially bad for business. Without foot traffic, how is a mom-and-pop shop to survive?

"It's perverse for a big city like Vancouver to be sapping its own strength by allowing houses to be vacant," he says.

Mr. Wachsmuth has worked with affordable housing groups in Toronto, and most recently he completed his PhD at New York University, where he studied cities such as Detroit, Baltimore and Philadelphia.

But those American cities are suffering from abandonment due to a depressed economy. In Vancouver, the vacancy problem is due to a major real estate boom, which has its own set of problems.

"Every house that's vacant is one less customer, so there is no doubt that there's a connection there," says Mr. Wachsmuth, who is a post-doctoral researcher on issues such as house vacancy at the University of British Columbia. "Cities are vital and economically healthy because of density. When a lot of people are on the streets, and they interact with each other, buy things, sell things – that density is the strength. The more vacant housing you have, the more you are stopping that strength. A mom-and-pop shop fundamentally relies on having a customer base in the immediate area."

Story continues below advertisement

Vancouver's empty-house syndrome is caused by speculation, or treating houses as commodities, without regard for community livability.

"Speculation fuels vacancy," he says. "Investment pulls housing off the market, and then the demand problem becomes worse. And that can be corrosive."

The numbers of vacant houses are not yet known. But the anecdotal evidence is clear to see. Anybody who lives on Vancouver's west side will know of a vacant house in their neighbourhood.

James Macdonald, an urban planner who works around the world, helped start the Beautiful Empty Homes blog to document the vacant Vancouver houses. The city's vacancy rate is low – and yet perfectly livable houses are boarded up and empty. After a period of time, as the house falls derelict, it is ultimately demolished to make way for a bigger house, which often stands empty as well.

"On my street, there are houses built in the last 10 years, and they are definitely empty. A lot of them get sold every year or two. It's an asset class, and people are moving money in and out," says Mr. Macdonald, who rents a house in Dunbar. "Absentee landowners pay property tax, but that's a fraction of the tax base and also all the community and business opportunities – all the things that matter for the economic vitality of the city."

Mr. Gust puts it this way: "People who live here are going to restaurants and hockey games and everything else – they are contributing. But a lot of wealthy people are treating us as a resort town. Big money wants to go where it wants to, and Vancouver is on the list. And it's a shame for people who live here. I think 10 years from now, we will regret it if we don't do something."

Story continues below advertisement

It's not just empty houses that are bad for small business – the big new houses that replace them are bad, too. When a house gets torn down on the city's west side, the house that replaces it is much larger. On average, it is 77 per cent larger, according to data provided by Landcor Data Corp. In Kerrisdale, the average new house built is 85 per cent bigger. Oftentimes, that huge house will sit empty, or only occasionally used.

And if it is used, even part of the year, the big house phenomenon alters the demographic that supports small business. Studies have shown there is a correlation between people who buy big houses and their tendency to travel by car to shopping malls and big box retailers, says Mr. Wachsmuth.

"If you look at the trend toward tearing down houses and making them bigger, that's a trend that moves in the opposite direction of walkability of neighbourhoods," he says. "Small retailers generally rely on foot traffic. In neighbourhoods where the houses are getting bigger, people do more driving. There is a strong correlation between people who have more money and people who drive more."

As well, sparsification – his word for the opposite of densification – occurs when multifamily housing, such as a house with a basement suite, is converted to single-family housing. That trend also means less foot traffic.

"There are a whole host of factors that correlate with empty houses and demolitions."

When the demographic no longer values the mom-and-pop shop, the big chain retailer moves in. Kerrisdale is seeing that trend get under way. Mr. Gust says rents have become unaffordable as a result – as high as a whopping $60 a square foot, including tax. That kind of rent makes it difficult for the mom-and-pop business to survive.

Story continues below advertisement

What can be done to help save small businesses, keep neighbourhoods livable, walkable and thriving? That is a matter for the city – and it's not difficult, Mr. Wachsmuth says. They just need to address the problem, like so many other cities have.

The city could easily adopt a "use it or lose it" bylaw to deter homeowners from leaving their houses abandoned for years on end.

"The big, low-hanging fruit is a vacancy fee. Other cities have done this successfully and it's not a crazy idea," he says.

It's standard now for cities with empty house issues to charge an escalating annual registration fee for vacant properties, Mr. Wachsmuth says.

So far, during this election time, only the Green Party and COPE have made a vacant home fee part of their campaign platforms. Neither the Non-Partisan Association nor Vision Vancouver has announced a plan to combat the problem.

"Developers are always very powerful in city politics," he says. "For politicians to push back against them, they need to know there is support from the community."

Story continues below advertisement

There are many other deterrents, he adds. San Diego imposes fines every 90 days for vacant properties that don't have a rehabilitation plan registered with the city. Portland conducts quarterly inspections at the property owner's expense. Winnipeg homeowners must keep a vacant property clean and in good shape, and if they apply for a vacancy permit, they pay a higher fee each time they re-apply. Los Angeles keeps an interactive database of vacant homes.

Vancouver could implement any of these ideas to offset a problem that will continue to grow and impact both community and small business.

"It doesn't have to be hard to deal with," Mr. Wachsmuth says. "If you switch things around so that keeping your building vacant takes some work, and some expense, you are making it a little less likely that absentee homeowners will want to do that. And in the meantime, the city generates revenue. It's a win-win."