For more than a dozen years, Bob Rennie, Vancouver’s real estate guru, has annually taken the temperature of the city’s housing market and offered a numbers-numbing report to the Urban Development Institute.
This year he’s calling quits to his annual UDI updates, but not before he delivered a bare-all speech Thursday as Vancouver continues to wither under white hot sales that have made “housing affordability” two empty words. (He’s not getting out of the real estate business, just his annual updates to UDI.)
Under his mantra of “it’s seriously time to change the narrative,” here’s five things Rennie said at the lunch.
1. Forget thinking homes in Vancouver can be affordable any more. Last year only 26 houses sold in Vancouver went for under $750,000, compared to 10,325 in Metro Vancouver. This year, 26 homes in East Vancouver sold for under $1 million, and only three on the west side sold for under $1.7 million. “The City of Vancouver should get out of the affordable ownership business.”
2. If not there, then where? It’s in the burbs, folks. “You know where the affordability is? It’s in our region. It’s in Burnaby, at 50 per cent of Vancouver prices, and it’s in Coquitlam, at 40 per cent of Vancouver prices, and it’s in Surrey, at 30 to 35 per cent of Vancouver prices.” Oh, and by the way, build more transit-oriented developments. “Any density solution in isolation of a transit solution won’t solve our problem.”
3. Vancouver neighbourhood groups are too white, too old and too resistant. “Neighbourhood groups seem to have lost their way and are prepared to sacrifice future generations by choking off supply and hurting affordability,” Rennie said. “The majority of participants in our planning processes are white male homeowners over the age of 55. Maybe it’s time to bring in some new stakeholders into the conversation. Neighbourhood groups require more diversity.”
4. Don’t blame China, and don’t tax foreign ownership. But a speculation tax? That’s OK. “China buys $6 billion a year in British Columbia exports. Are we going to tamper with those jobs and our economy? … A foreign ownership tax of 10 per cent on a $5-million home will not stop a sale or create affordability … It will only cause racially charged conversations to go beyond where they are now.” Rennie says he still believes a speculation tax aimed at buyers who flip a home would cool the market at the lower end.
5. There’s a glut of money heading for the market. With $197 billion in mortgage-free properties held by people over 55 ($66 billion of that with people over 75), there’s a lot of money available to help their children buy homes. But there’s no market or supply, so the result? Surging prices as people bid up those scarce listings.