CityHallWatch comment: Elected councils have an obligation to look after the long-term well-being of their municipalities. One of their most important functions is regulating land use. Developers are the regulated, but also are consistently the top donors to political campaigns of Vision Vancouver and the NPA. For healthy government, regulators should not be funded by the regulated — to avoid conflicts of interest in Council decisions on rezonings and development. Now the Conference Board of Canada says that among other regions, Metro Vancouver, including Vancouver, is in for a decline in residential construction due to oversupply. We ask: Have our elected officials been too kind to certain developers?
Read full article in the Vancouver Sun here:
Excess of condos and townhouses will result in sharper decline for Lower Mainland, report says (Christopher Reynolds, Vancouver Sun, 26-Sept-2012)
Business in Vancouver has also covered the story: http://www.biv.com/article/20120925/BIV0111/120929952/bc-house-prices-dropping-will-drop-further-conference-board
Read news release and download Conference Board of Canada report here: Residential Construction Industry to Come in for a Soft Landing in Late 2012 and 2013 (25-Sept-2012)
The industry is “poised for a slowdown next year. … Regional markets that are exposed to more risks, such as Vancouver and Toronto, will feel more of an effect.”
Some major points of Vancouver Sun article, noted by CityHallWatch:
- Conference Board of Canada says Metro Vancouver will have a sharper decline in residential construction than other cities.
- Some Vancouver home builders disagree.
- The report cited an excess of supply – particularly of condominiums and townhouses – as well as modest job and income growth, lower consumer confidence, high household debt and tighter mortgage rules as factors in the predicted contraction of the industry across Canada.
- “Housing starts will actually fall below demographic demand in the next year or two, primarily due to the fact that we need to absorb unoccupied units,” said Michael Burt, industrial economic trends director at the Conference Board..
- Townhouses and other multi-unit homes now have higher vacancy rates in the Lower Mainland than in recent years.
- Peter Simpson, president and CEO of the Greater Vancouver Home Builders Association, disagrees with the Conference Board. He said: “It’s sort of a steady-as-she-goes market: no peaks, no valleys.”