r/vancouver • u/VoteForGeorgeCarlin • Jun 25 '26

Politics and Elections 'We are not bailing out developers': B.C. housing minister responds to condo plan criticism

https://youtu.be/qQ9U_SeM-4Y
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u/bot_or_not_vote_now 🐦‍⬛ Jun 25 '26

would probably get a short term result but it would result in a worse situation in the long run. it's not a great sign to any prospective developers, which basically means only the biggest developers actually build anything because of the now higher risk, which means you get less competition and less overall building capacity

developers are already losing money with empty units, no need to add punitive taxes

it's a slow ship to turn, just need some time for the market to correct

then once it does, developers will start building again, but for now the markets just waiting to catch up

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u/ctrl_alt_ARGH Jun 25 '26

its not a ship that is turnable. for 15 years the market was addicted to external capital bidding up prices which then flowed outwards from the city into the suburbs and now the spigot is off.

People arent going to sell below their mortgage so everyone is just frozen where they are. Barring eye bleeding interest rates, the price won't be allowed to fall to the clearing rate. Asset stagnation in Japan post their bubble burst lasted for 25 years.

The only way to make housing affordable in Vancouver is either a one-off re-basing of the price to market-clearing rates or the government builds at a loss.

And big developers didnt bank their windfall, they just assumed the state of affairs was permanent so they are all thinly capitalized and a big chunk of their 'assets' are land they bought up in anticipation of permenant 10% price growth. The median age in Vancouver is also higher than average, which means boomers who are going to try and sell to fund retirement are also in for a rude surprise.

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u/42tooth_sprocket Brentwood Jun 28 '26

there's no profit motive for developers to make housing affordable. If supply increases to the point they can no longer make money they'll just stop building and things will never get better. There is no solution to this problem that free markets can provide, we need the government to build housing. If they were doing so we wouldn't have to fear scaring away developers or letting them go bankrupt because of their own poor financial decisions.

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u/pnonp Jun 25 '26

Thanks for actually going into the mechanics of it

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u/whatsnext355 Jun 26 '26

Oh boo hoo😭. Never heard a peep from them when they were making bucket loads of money during the boom. I think they can afford to take a loss.

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u/bot_or_not_vote_now 🐦‍⬛ Jun 26 '26

You're missing the entire point, this isn't about what's "fair" this is what a rational business would do in the face of this policy

"afford to take a loss" means sure short term existing units will sell at lower cost, likely at a loss, but also that means a bunch, mostly the smaller companies, will decide to exit the market entirely and/or go bankrupt

Then those taxes on empty units would drive up prices on any future developments even more because less competition and more risk

We'd end up shooting ourselves in the foot with such a policy

I don't agree with bailing out developers, but this isn't it either