Developer says foreign buyers tax distracts from key housing issue: supply
Supply concerns continue to grow, says developer
While British Columbians continue to grapple with concerns over foreign home buyers, local developers say the real issue is a lack of supply in the housing market.
The B.C. government has brought in a 15 per cent tax on foreign nationals purchasing properties in Metro Vancouver, but Jon Stovell with the Urban Development Institute says the move distracts from the low supply of housing.
"It's easy to blame a constituency who are faceless and voteless and pretend that it's all their fault and that the buyers are causing the problem," Stovell said.
"Ten per cent of the buyers are causing the problem, mathematically it makes no sense."
- New B.C. property tax for foreign buyers hurts province, say insiders
- B.C. to tax foreign buyers of Metro Vancouver homes
Vancouver Real Estate marketer Bob Rennie says there's a need for real solutions, not political or race relation solutions.
"We need a solution that goes toward affordability," Rennie said.
"I think the 15 per cent tax on foreign buyers is one corner of trying to curb demand but we have to watch it holistically about what are we going to do on the supply side," he said.
Development permits can be tied up at city hall for years.
Permit waits are long: developer
Stovell believes it takes four to seven years in Vancouver to approve a project or community plan.
"We have very complicated approval processes that have built up over decades adding more and more regulations to do with liveability and sustainability and safety.
"All these things are good in their own right and they're all important but over time they just build up," said Stovell.
He says municipalities are struggling with budgeting and staffing problems and so local governments have not been able to keep permits moving along.
Stovell said consultation periods are taking too long.
"I think people need to have their say, but it can be done quickly and efficiently," he said. "Do it with the goal in mind of getting it done in a timely fashion."
Critics have said developers asking for supply are only thinking about their own interests.
"It doesn't make sense to say developers will benefit," Stovell said.
More homes will lower prices, says developer
"Developers make the most money when there's a lack of supply, yet we're arguing most strenuously for more supply."
Both he and Rennie believe bringing in more homes will help push home prices down.
"To cool demand, it's increasing supply because right now people don't have a lot to choose from especially in the city of Vancouver," said Rennie.
Metro Vancouver's population is expected to increase significantly over the next 25 years. Stovell thinks there are about 70,000 homes tied up in approval processes in the region right now but 30 or 40,000 need to be approved every year to keep up with what's expected.
"We're encouraging the province to work with local governments to try and set what we would like to see as mandatory growth targets for municipalities," Stovell said.
He said the lack of conversation around supply has been frustrating, and he hopes it will change.
Vancouver City Councillor Geoff Meggs said that despite the complaints there have been record numbers of permit approvals in the past two decades.
"We're trying to maintain that public oversight that protects the quality of the [housing] stock going forward," said Meggs.
"All of these rules that [they] find onerous have to be double-checked," he added.