Vancouver can't force house prices down or make room for everyone without drastic changes – so people should adjust to the reality that the suburbs will be the only affordable choice, prominent condo marketer Bob Rennie says.
Mr. Rennie, in his annual speech to the Urban Development Institute, said the City of Vancouver should give up on plans to spend hundreds of thousands of dollars on affordable home-ownership programs that will serve only a few hundred people.
"The City of Vancouver cannot offer a discount that will bring in housing at less cost than what is already available in the region," Mr. Rennie told a crowd of about 1,000 people.
He said there are 197,000 more people working in the city than there is room for. It would take 76,000 new units to house them, which would mean building 380 condo towers or mowing down 12,000 single-family houses and replacing each one with six townhouses.
Mr. Rennie said the province should buckle down and figure out a transit funding solution, so people can get easily to the parts of the region that are affordable.
He spoke directly to the province's Community Minister, Peter Fassbender, who was in the audience.
"Any density solution in isolation of transit won't solve our affordability problem, Mr. Fassbender," Mr. Rennie said.
In a speech filled with numbers, exhortations and sometimes obscure jokes, Mr. Rennie painted a picture of a region filled with wealthy local homeowners and a steady stream of new buyers, all jostling each other to buy in a region without enough supply.
Mr. Rennie said 55-and-over boomers are now sitting on $197-billion in clear-title equity, with $60-billion of that owned by people over 75.
They will start injecting that into the real estate market at increasing rates, as they die or start to fear new federal inheritance taxes.
Every $10-billion of their money will fuel $40-billion in house purchases for their millennial or older children, he said, keeping the market going.
Mr. Rennie didn't discount the impact of Chinese buyers – a topic of hot debate in Vancouver – saying they are in every city in the world.
But he didn't talk about them as a major driver and he insisted they are coming here to live, not just invest.
Mr. Rennie, who claims he doesn't market any projects offshore because there's no need with the local market so strong, argued that putting an extra tax on foreign-investor houses or condos won't slow them down at all.
"And, after six months, when a foreign-ownership tax has failed, it will only cause racially charged conversations to go beyond where they are now."
Mr. Rennie said that China buys $6-billion a year of B.C.'s exports, and that the tuition Chinese citizens pay at B.C. universities is keeping those institutions afloat.
Foreign-student tuition now accounts for 26 per cent of revenue at the University of British Columbia, 24 per cent at Simon Fraser University and more than 41 per cent at Emily Carr University, he said
"Are we going to tamper with those jobs and our economy?"
Mr. Rennie reiterated his support for a speculation tax, however.
Mr. Rennie's speeches are closely followed because he is the most outspoken member of the region's huge development industry. As well, he has headed up fundraising campaigns for a variety of political parties and initiatives.
He is now the head fundraiser for the B.C. Liberals, although he says he will end that after next year's election. He also has been a prime fundraiser for Vision Vancouver, the civic party led by Mayor Gregor Robertson.
That gives Mr. Rennie the ear of politicians, although not always with results. The province has proven itself unwilling to find a solution to transit funding for the region, even though Mr. Rennie and developers are big transit fans.
The speech was Mr. Rennie's last one to the Urban Development Institute, he said, after 14 years.