(This post was originally made on 14-Feb-2013.) When it comes to housing affordability, foreign ownership is not only the elephant in the room, “it’s the elephant crushing the table.” Those are the words of Brent Toderian, Vancouver’s former director of planning at a keynote panel discussion on “Living Affordably in Greater Vancouver” at the February 2013 BUILDEX (convention on designing, building and managing real estate), at the Vancouver Convention Centre West. See further below for details of the panel.
Responding to a question from the audience about limiting foreign ownership, Toderian said it is “something the Mayor’s Task Force on Housing Affordability dropped the ball on. The competition between external demand and local demand — that’s the nicest way I can put it — is one of the reasons that, barring a collapse and a crash, we are going to remain a very expensive city to own in.”
Panel moderator, David Beers, editor of The Tyee, agreed, saying his publication tried to look into foreign ownership, but there is no clear way of measuring it. “So step number one might be to devise such a way,” he said. Another panelist commented that land speculation along the Cambie Line (Translink Canada Line on Cambie Street) is going to cut into a lot of the affordability that could have happened.
Speaking from the audience, Randy Helten, for CityHallWatch.ca, said, “The biggest take-away point today is that the largest elephant in the room is foreign speculation. We should all be asking our media, academics, public servants, and elected officials to put more attention into this. Other municipalities around the world have looked into this, have got the data, and have measures in place to deal with land speculation. The fact that ‘no data is available’ is not an adequate answer to that question.”
He also asked if the Short Term Incentives for Rental Housing (STIR) and other policies of municipal governments may actually be promoting speculation and inflating land prices, making our land less affordable. He cited a recent discovery that some bare land lots in the West End as well as sites just rezoned recently under the STIR program, and about to be rezoned (Beach Towers, public hearing on February 19, 2013), inflated in land value by 28% to 38% from 2012 to 2013.
In response, Toderian said, “The short answer is that some buyers are stupid …
there are always speculators and people willing to overpay. The STIR program didn’t create speculation. Speculation happens with or without the STIR program.”
2008 Mayoral candidate and founder of Business in Vancouver Peter Ladner builds on the topic of foreign money affecting housing prices, in Business in Vancouver on February 12, in “Fiscal reality continues to elude Vancouver real estate market.”
- He writes that much of the imported money flowing into contenders for the “most unaffordable city”(Hong Kong, Singapore, Sydney, Vancouver), is coming from China. He cites the January 20, 2013, Bloomberg “chart of the day”showing “an uncanny match” between China’s GDP growth and Vancouver’s housing prices.
- He says other “most unaffordable” cities have taken steps to dampen investor demand. Hong Kong just introduced a 15% stamp duty on homebuyers without a permanent resident’s, card, and Sydney doesn’t allow foreign purchases of existing housing stock. (CityHallWatch has written on Hong Kong’s measures here.)
- He cites the Mayor’s Academic Working Group on foreign investment in real estate [under the politically-appointed Mayor’s Task Force on Housing Affordability] having recommended that “the City learn more about nature, scale and impact of foreign buyers on the local housing market … prior to taking any particular actions.” ]The MTFHA, meanwhile, wrote off the need to look into foreign investment.]
- Ladner concludes, “… until those on the losing end make some noise, our politicians and builders will focus exclusively on building more condos and imagining that one day, somehow, prices will magically align with local incomes.” [Update in May 2015: Eveline Xia of #donthave1million is exactly what Peter Ladner may have been referring to here. Is he a prophet?]
CityHallWatch notes that in a November 2011 mayoral debate on housing affordability, panel member Frances Bula asked: “If elected, will you look into the impacts of foreign investment on housing affordability?” Both candidates — Gregor Robertson and Suzanne Anton — answered with one word: “No.”
CONCLUSION: As CityHallWatch has written elsewhere, it’s up to citizens (renters, owners, everyone) to initiate changes, as no one inside the system is motivated to do so. We urge everyone concerned about housing affordability in the Metro Vancouver region to ask media, academics, public servants, and elected officials to put more attention into foreign investment and ownership in our region. In fact, perhaps a failure of our elected officials to look into this matter (data, causes, solutions) may even be a cause for challenge under the Code of Conduct as an error of omission. Our civic system is failing us.
A summary of the panel is here. Many other interesting points were raised about housing affordability. Please read on.
Journal of Commerce (www.journalofcommerce.com)
February 14, 2013, 10:30 to 12:30, Vancouver Convention Centre West
Buildex Architectural Keynote Panel: Living Affordably in Greater Vancouver
Moderator: David Beers, Editor, The Tyee
- Dane Jansen, Architect AIBC, R.A. State of Washington, LEED AP, Principal, DYS Architecture
- Sean McEwen, Architect AIBC, S.R. McEwen Architect
- Brent Toderian, MCIP, President of TODERIAN UrbanWORKs, President of the Council for Canadian Urbanism in Vancouver, former City of Vancouver Director of City Planning
- Heather Tremain, Principal, Urban Fabric Group
This session provides a rare opportunity to dialogue openly with an expert panel of
professionals involved in the affordability of Greater Vancouver housing. Join
architects, designers, members of government, media, and advocacy representatives in
this spirited discussion. Discover what`s currently being done – and join the
conversation on what we might be able to do better. Is affordable livability in
greater Vancouver a real possibility or an ever-receding horizon?
Read full article on the keynote panel here: http://www.joconl.com/article/id54037?search_term=buildex
Whether this is accurate or not, we note a Globe and Mail story (Real estate firm apologizes after employees pose as buyers in news stories, 14-Feb-2013) stating that “According to 2011 data by the Landcor Data Corporation, 75 per cent of those who purchased Metro Vancouver condos as investment properties are from Metro Vancouver. About 3 per cent are from the U.S. and 2 per cent are from other countries.”