Hashtag #itssupplystupid may simplify the presentation that Urban Analytics’ Michael Ferreira gave to a sold-out crowd at UDI’s latest industry lunch on October 20, 2016 … but it certainly makes the point.
The Foreign Buyers Tax, in Ferreira’s eyes, was a political move intended to fuel a Clark/Liberal Party re-election. He goes on to point that there was little to no industry consultation on the policy and calls the initiation of the tax without a grandfather clause for unconditional deals caught in the timeline a “cash grab”.
The tax itself has had little impact on slowing down the market. Perhaps there are some spin off effects now causing a “standoff” between buyers and sellers where-in sellers are holding firm to their prices and buyers are holding off looking for price reductions. In the end, Ferreira still believes that demand is being driven by low interest rates, great currency exchange for foreign buyers, and a world-class city.
What is perhaps a nastier culprit is the Federal Government’s new mortgage rules that now quash those buyers most affected by affordability; entry level / first time buyers are essentially seeing their buying power squeezed more than ever before.
Commenting on the City of Vancouver’s Vacant Home Tax, Ferreira stated, “How about adding more supply?!” Urban Analytics’ numbers show that Metro Vancouver currently has only 1.4 months’ worth of new multi-family supply available.
How can we increase the supply of multi-family homes to the market? = Expedite the Municipal process and collectively say YES to adding to the housing continuum. “It’s really simple,” he says. “This place is awesome. I want to see us build more homes for more kinds of people so we can keep it that way” – Michael Ferreira.
To read more on Michael’s presentation visit the UDI website HERE