Sam Sullivan: High house prices—foreign buyer fact or fiction?
For the sake of our economy and young people, we must address the house-price crisis. But we must first identify the problem.
For the last couple of years, a debate has pitted non-economists against economists. The non-economists claim foreigners are to blame. The economists claim we Canadians are to blame.
NDP politician David Eby has led the anti-foreigner group. A study he initiated indicated up to 70 percent of West Side Vancouver houses were purchased by foreigners. Just last month Stats Canada researchers and Government of Canada housing economists finally released their report. They found 3.2 percent of all single detached homes in Metro Vancouver were owned by nonresidents. This includes Americans and British Columbian snowbirds who live south of the border most of the year.
Most foreign ownership was in condos (7.9 percent) which have seen the lowest price rises. The foreigners tend to own newer, smaller, more expensive condos downtown where many have business relations or have "pied-à-terres".
This report seems to have solved nothing. The theory that foreigners are responsible is popular among British Columbians. The non-economists claim that foreigners are hiding their ownership. Government researchers and economists are now researching this claim. This will not deal with the other accusation that the statisticians are deliberately misleading the public.
British Columbia has always had non-resident owned housing. The poet Rudyard Kipling bought lots in Vancouver in 1890. The Vancouver streets Westminster and Ninth were changed to Main and Broadway to increase sales to U.S. investors. World-renowned neighbourhoods such as False Creek North and Coal Harbour were built by Asian investors.
Let us hope that the new numbers will settle this issue. If the researchers uncover a massive conspiracy of foreigners buying our houses and pushing up prices then we need to take corrective action.
But if not we need to take action to deal with our own problems.
In Vancouver, since the 1970s, it has been practically impossible to convert suburban areas to high density. Today, almost 70 percent of residential land continues to be in suburban form. Many of these neighbourhoods have fewer people living there today than the 1970s.
My plan will deal with the bottleneck in the creation of housing. I will remove elected politicians from public hearings. Legislators should not be acting as judges in a properly designed government. Judicial tribunals should be responsible for judicial functions.
I have created the following video which describes my analysis of the problem and how we can solve it: