What roll for developers in affordability debate?

Often when it comes to real estate stories in the local media the people interviewed are developers, marketers or realtors. These are all professionals who deal with the market every day, so it makes sense for the media to seek their opinion on housing stories.

But should they be driving the ‘affordability’ debate?

Architect and professor Avi Friedman thinks not.

“Builders will not initiate innovative ideas because they are profit motivators, so the city needs to act as a catalyst,” he told CBC Radio One’s Rick Cluff on The Early Edition.

Friedman also criticized the idea offered by many in the real estate industry, like marketer Bob Rennie, that Vancouver isn’t going to be affordable for everyone and that young people should consider moving to the suburbs.

“People who grew up and live in a city should be able to buy a home in their city. The fear is that, some of these young people may leave Vancouver,” Friedman said.

“Once you see the departure of young people from the city, they take along their potential … to start new businesses, to create a vibrancy that young people bring to a place.”

Friedman says it is incumbent upon the city and its leadership to foster and implement new ideas that will allow young people to stay and thrive in Vancouver.

Read the full article over at the CBC.

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hoy-poloz
Guest
hoy-poloz

This is what happens when a country prostitutes itself for money.

Dave
Member

How come some of my posts are being held for moderation?

Dave
Member
With housing, prices are highly correlated with Months of Inventory (MOI). A stable market is around a 6 MOI. An appreciating market is around 3 MOI. Prices will start coming down with a 7 or 8 MOI. If we want prices to come down, we either have to kill demand or increase supply. I can’t imagine anybody is really pushing the demand side because we need housing for people. So, the only other option is increasing supply. If you build, it will increase supply (duh, by definition). And again, more supply puts downward pressure on prices. If you want to reject basic economics, then this conversation is hopeless. Sadly, the average person is economically clueless and more people will gravitate to somebody like Gregor than somebody who speaks the truth. If anybody thinks taxation people more is somehow going to… Read more »
Best place on meth
Member
Best place on meth

@39

“Softy, that’s not how free markets work. This is Economics 101 and basic supply and demand, which has been proven over and over again for hundreds of years.”

Dave, this is limited real estate we’re talking about – not unlimited Nike sneakers.

It doesn’t matter how low your input costs are, if there are more buyers than units available at any given time then prices will not come down.

I see you’re back to shamelessly shilling for developers and their profit margins after a brief period of making sensible posts.

UBC in crisis mode
Guest
UBC in crisis mode

From one of signed commentator on change.org:

I’m fed up with Bob Rennie and the politicians dismissing this issue as racism against Chinese. I’m Chinese, born in Vancouver and lived here my whole life, and I say foreign ownership needs to be stopped ASAP. It’s ruined the neighborhood I grew up in. For the longest time my parents’ house had empty houses on three sides, all purchased by absentee foreigner owners. I want to live in this city, but the odds of that just keep on diminishing.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@39

supply and demand is very simplistic and doesn’t capture the reality of the real estate market

Livid
Guest
Livid

Re #38 I think the one post in the comments section says it all.

“So, Quebec gets the money, we get screwed, and both levels of government pretend they don’t know about it. Business as usual.”

Who’s to blame? Is it the Quebec Provincial Liberal Party? Is it our own BC Liberal Party for not standing up to this? Don’t the Federal NDP have a majority in Quebec? What about The federal Conservatives for not pressing harder for the Quebec IIP to be stopped?

Just who is responsible for running or better still changing this nightmare scheme?! Provincial. Quebec Federal or national Federal?

Dave
Member

Softy, that’s not how free markets work. This is Economics 101 and basic supply and demand, which has been proven over and over again for hundreds of years.

What happens when you lower input costs and enable greater supply is you shift the supply curve, which lowers the equilibrium price.

The question of profit for the developer is more complicated, but it should be irrelevant to the consumer who only cares about absolute prices.

Livid
Guest
Livid
Perhaps the last unaddressed ‘Elephant in the room’ is the ridiculous Quebec Investor Scheme. Whereby investors ‘invest’ in Quebec whilst we pick up all bills and suffer the housing consequence. Until this is stopped then everything else may be futile. What’s worse is that its elitist. Those suffering more than most are would-be honest hard working skilled or working immigrants who just can’t afford to come here and work. They along with the BC middle-class (house prices) pay the price. And for what? For whom? We have to make this political – NOW, This article largely below (june 2nd) slipped under the radar. But it highlights the enormity of that scheme to our problems. If we don’t stop Quebec IIP NOTHING will change. Again, it’s a farce and lets make it political. Read on. —- B.C. immigration goes negative but… Read more »
Softy
Guest
Softy

@33

Everything you said would increase developer profits but do nothing to reduce the prices of real estate.

For example:

“give developers more density for free. Of course they’ll take it and build more product. Duh.”

This reduces developer costs and increases their profits. They will sell the real estate at the same price as before.

Corrupt in Canada
Guest
Corrupt in Canada
Dave
Member
I think we only have ourselves to blame for high real estate prices. We like to blame others but we rarely look at ourselves and root causes. Let’s face it, high prices are a consequence of our socialist thinking here. We think a freeze on agricultural land is a good thing, but it carries a price tag and we don’t acknowledge it when we make these decisions. We let the City of Vancouver run rampant with socialist ideas, but don’t count the costs because we push it onto developers. There are 9000 employees at the City of Vancouver. The City of Surrey, which has a similar population, has 3000 employees. If you think those extra 6,000 people are being employed from property taxes, you would be mistaken because property taxes are similar. Those people are being paid because of all… Read more »
Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
it’s been said that the anti-foriegn money movement is at a tipping point. we have all followed this and i don’t think i need to repeat what we all already know. but i also think that sinofication has reached a tipping point. it’s been said before that someone can live in the metro region and only speak chinese. now, i think we’ve reached the tipping point where speaking chinese is certianly catered too and may become necessary. long established english business in richmond have put up chinese signs and hired chinese speaking receptionists. the vancouver sun, vancouver’s english news paper, now hosts chinese articles. the brown guy in richmond costco demonstrating titaniam cooking pots even knows some chinese. we’ve passed the point where chinese is tolerated and we are entering the time where chinese is catered too. this will increase… Read more »
Corrupt in Canada
Guest
Corrupt in Canada

@24 it is all smoke and mirrors.

Mayor Moonbeam knew it would never go through but he wrote and publicly released the letters anyway.

This is all a ploy to try to gain some credibility.

Dave
Member
We overthink things in this City. Affordable housing isn’t a complicated issue despite what anybody says. The economics of supply and demand are well established. I find it so funny that Gregor is now the champion of affordable housing when he is one of the greatest culprits. The timeline for development approvals at the City is at ALL TIME HIGHS. The City demands for amenities for additional density are also at ALL TIME HIGHS. It’s so bold of him to go after the immigrant money to divert attention away from the real causes… the City itself. If we want cheaper housing, give developers more density for free. Of course they’ll take it and build more product. Duh. Chop the Property Transfer Tax in half as well. That would help. If you really wanted to help chop the prices of single… Read more »
patriotz
Member

@26:

FP is ignoring the fact that investors (in Vancouver and Toronto at least) are buying properties which lose money on the current account even at today’s low rates, which is a bubble by definition.

@19
Guest
@19

That would offend the international students renting this units.

George
Guest
George
I know it’s not real estate, but look at this story, look who’s running our province. These are the people we have to contend with when asking the government to do something about our real estate woes. The BC Liberals have been caught in bald-faced lies about an RCMP investigation that never happened. From the Vancouver Sun: “The records, obtained by The Vancouver Sun through the federal Access to Information Act, show that the B.C. government repeatedly pointed to an RCMP investigation over several years, while at the same time doing virtually nothing to inform police about the case and failing to provide any evidence of a crime. “Despite inferences in the media that the RCMP has undertaken an investigation or received information from the Province, this has not been the case,” wrote Const. Dean Miller from the RCMP’s Federal… Read more »
southseacompany
Member
southseacompany

“U.S. should delay rate hikes until 2016, IMF says”, CBC News

http://www.cbc.ca/news/business/u-s-should-delay-rate-hikes-until-2016-imf-says-1.3100012

“Global finance body says there’s no need to hike — yet”

“The International Monetary Fund is downgrading its outlook for the U.S. economy this year and says the Federal Reserve should wait until the first half of 2016 to start raising short-term interest rates.”

fanaticallybroke
Guest
fanaticallybroke

Find out your MLA’s nam and then e-mail them. It doesn’t get easier. Ask them what they intend to do in response to the 25,000 Vancouverites who are sick of their city being sold to the highest bidder.

list of e-mail addresses:

https://www.leg.bc.ca/mla/3-1-7.htm

fanaticallybroke
Guest
fanaticallybroke

We quietly broke over 25,000 on the petition.

Now to contact your MLA and ask them what they intend to do about it.

Even pathetic Gregor has got into action and passed the buck to the Provincial Government. Lets give the MLAs some heat too and send a message to this do-nothing premier

Link to petition

remember this petition and the rally probably got Gregor into doing something.

https://www.change.org/p/premier-christy-clark-mayor-gregor-robertson-mayors-and-city-councillors-of-the-gvrd-restrict-foreign-investment-in-greater-vancouver-s-residential-real-estate-market?tk=gs_vu7hFhzrtQo9DCFvO17gEkmrD4AKi6Hu5c5FE84g&utm_source=petition_update&utm_medium=email

southseacompany
Member
southseacompany
“Why the sky still isn’t falling on Canada’s real estate market”, Financial Post http://business.financialpost.com/investing/why-the-sky-is-still-not-falling-on-canadas-real-estate-market “For one thing, we like to think that bubbles are inflated by irrational behaviour. But is there anything really irrational about Canadians buying homes for unprecedented prices? Well, no. They are only doing what makes sense: borrowing money when money is cheap.” “Today, the overnight rate is 0.75 per cent. And you can get an 18-month mortgage from one southern Ontario credit union for 1.49 per cent.” “In 1990, the central bank raised rates to fight inflation, topping out in May of that year above 14 per cent. It was successful – too successful – in fighting inflation, which dropped well below its target of three per cent as the economy slipped into recession. It took a decade for the Toronto real estate market to recover.”… Read more »
say whaaaa?
Guest
say whaaaa?

@24

a) We have regularly scheduled elections.
b) Who would do better in power?

Go away.

patriotz
Member

Vancouver mayor pitches affordable housing idea

Vancouver Mayor Gregor Robertson is calling on the province to increase its property-transfer tax on the most expensive properties and invest the proceeds into affordable housing.

He makes the pitch in a newly disclosed letter to B.C. Premier Christy Clark, where he also asks the province to give municipalities more power to track property ownership and ensure the timely occupancy of vacant units.

The May 22 letter, released Wednesday by Mr. Robertson’s office, also proposes a speculation tax to discourage the quick resale of new housing. B.C. Finance Minister Mike de Jong publicly rejected that idea four days later.

Which confirms what has already been said here. If you want anything to happen on this front, the current provincial government has to go.

southseacompany
Member
southseacompany

” Interest rates: the musical – video”, The Guardian

http://www.theguardian.com/business/video/2015/jun/04/interest-rates-the-musical-video

“Ever wondered what monetary policy would sound like if it was a piece of music? No? Well, here it is anyway: 70 years of interest rates ups and downs, with one month represented by one beat, and quarter-point changes given by semitones. The sound reflects the sobriety of the postwar era and the volatility of boom-and-bust before resolving to a funeral dirge following the crash. It’ll grow on you”