Vancouver real estate developer Bob Rennie switched from interviewer to interviewee for the "affordability, density and building for the future" session at the Independent Contractors and Businesses Association of British Columbia's Industry Outlook. He was interviewed by former broadcaster and current Liberal candidate Jas Johal.
Rennie said all developers are working with very little in the way of supply, and that he is a "lightning rod" for comment on density and affordability. But he said there is political risk in committing to density, and yet it is important that it happen over the next 20 years.
The cost of land is astronomically high because we hang onto over 60 per cent single family housing, and that has to change or the core will continue to be unaffordable and hollow out, he said.
"We pretend we can solve this in any other way but supply, but we need political leadership," Rennie said. "We'll do anything but talk about supply."
Rennie added this isn't a problem that can be solved quickly, and that the path of affordable rental might be preferable to strict adherence to affordable housing.
Johal asked about speculation, and Rennie said once it hits the low end of the market it hurts the first-time buyer. But the 15 per cent tax will not be a deterrent he said, and it mostly isolated to the upper end of the market.
Further, it's political suicide to talk about reducing the cost of housing, despite affordability concerns, because 65 per cent of Vancouverites own a home and no-one wants to be told "we're going to halve the worth of your property."
Rennie added that in an unstable world people are looking to send their children to good schools and have a measure of stability, so "that money is coming and will keep coming."
Supply can be opened by using Agricultural Land Reserve land, Rennie said, but there is also money coming into the market because boomers are downsizing. Parents tend to give children or grandchildren money once they've downsized so they can get into the market, and that won't change and isn't foreign money, he said. O that money is going into the system and is also making affordability difficult.
Johal raised the idea of introducing a surcharge for those who don't spend a substantial amount of time in B.C., but Rennie said "we want to close Disneyland to the public and still run all the rides." He said those who have just entered the market, who may not have the highest wages, shouldn't be punished for ownership.
Rennie also compared blaming the real estate situation with Trump blaming foreigners, saying it was somewhat satisfying short term but doesn't solve anything.
Rennie finished by saying he couldn't see what the tipping point will be for the market, but to look at Surrey as a growth centre.