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Originally Posted by whatnext
That's malarkey.
There isn't demand for those units now. Virtually every project is completing now with unsold units. It amazes me how clueless some people really are about how far off a cliff Vancouver real estate is set to fall.
The only kernel of truth in this argument is that we do need more rental supply. Unfortunately greedy developers have largely bid up land prices to such a point that building rental becomes tenuous.
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Actually I agree with your first point except for the cliff argument. Vancouver prices cannot go down a cliff because demand here is too high, we're a growing city. Unless supply magically increases or something big happens to push people out people will need to live somewhere. Scaring off investment will only drop prices a bit, not a lot. The mortgage crisis in America didn't drop our prices like a cliff, and you'd assume this can reflect what happens when investment dries up as it would have shifted to buying cheap American real estate. What we have now is prices that are still high with buyers waiting to see what happens or unable to afford them and most sellers unwilling to drop prices unless they are desperate.
I totally disagree with the greedy developers argument. Its like people expect businesses to do things that lose them money? Would you work a job you had to pay to do? Why isn't McDonalds, Walmart, Microsoft, etc. being called greedy for trying to make a profit? We all work for money. Why don't you take out a huge mortgage to develop a property and take a loss? Are you greedy too because you don't do this? We can't simultaneously insult developers than expect them to keep doing business here. One business isn't worse or "evil" or greedier than the other. If you want rental developments then make a case so that developers can make money. Rental is extremely difficult to make a case for because payoff isn't for 20+ years. You need 20-40 million minimum to make most rental buildings work which is a big chunk of change to invest long-term. No one's going to invest that in an unstable climate. Long-term no one trusts Vancouver to not put in stronger rent controls so that rent can't increase at all for a few years or even more real estate taxes/laws.
You forget that we have super strong rent controls and tenant protection laws which scares the fuck out of rental investors/developers. Were literally saying why don't you build here, we will increase rental laws so you have a hard time making money from rental, we will increase taxes to make it hard to make money, and we will decrease property values so your investment goes down in value, but your greedy for not accepting getting shafted! Why should they build rental here where they legally get shafted with an uncertain future when they can build rental in Alberta? To attract businesses we need to create an environment they can feel safe in, that they can make a profit in. Instead we're talking about more rent controls, increased corporate taxes, more real estate taxes, illegal money investigations, banning foreign money, etc. We've created an unstable environment for investment and are yelling at investors for being greedy by running away instead of staying and taking a loss. We could have worked with foreign money, developers, investors, etc. Instead we decided to say you are to blame for all our problems, get out. There's a difference between asking that investors lower their profit margins in order to build more housing or rental and telling them to take a loss so that rents are lower. Right now the government is saying they may be changing policies so that 100% (from 70-80%) of the increase in property values from building more housing for rental and strata on Broadway goes to them which leaves developers 0 incentive to build more. In the end our real estate legislation and laws are so unstable that no one trusts BC as a place to invest anymore. If you want people to invest in shit then stop being so damn unstable with legislation.
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Our understanding is that the City’s proposed DCEs represent 100% of the lift in the
value of land from rezonings, which is substantially higher than past practice. It is
noted in a City of Vancouver brochure, Rezoning & Community Amenity
Contributions: Negotiating for a More Livable City, that “CACs typically represent 70-
80 per cent of the increase in property value.”
We are concerned that the City may seek to charge Community Amenity
Contributions on rental housing projects and/or increase the Commercial Linkage
Targets on new job spaces. Both strategies would significantly undermine the City’s
efforts to improve housing affordability and enhance economic development.
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http://udi.bc.ca/june-20-2018-letter...nning-process/
https://business.financialpost.com/o...rals-took-over
https://www.cbc.ca/news/canada/briti...-tax-1.4398594