You know what, that’s a good idea, but what we really need is…
Demand Side Opinion
Foreign capital buying homes, pushing up land prices
Lack of government oversight in real estate
Greedy developers, builders and landowners
Supply Side Opinion
Not In My Back Yard (NIMBYs)
Opaque city policy and development application delays
Land Constraints, Limited by Water, Mountains & Border
Since I moved back to Vancouver in 2012, I have seen real estate article after real estate article talking about either supply or demand. These articles are typically very black and white and tend to fall on either a supply-side or demand-side emphasis.
As human beings, we make decisions first and foremost based on judgments. Even the most open-minded person needs to categorize the world into groups of preference and prejudice. I wake up in the morning; do I want coffee or tea, eggs, or peanut butter? I need to classify the world into good for me or bad for me, helpful or hurtful; otherwise, I will be unable to make any decisions. And I need to make these quickly, or I will experience analysis paralysis. So our choices are typically simple, black and white, dogmatic.
We say things like; It is KNOWN that Vancouver land prices have risen due to an inflow of foreign capital. Some of us are mad about this, the demand-side opinion. Others see opportunity and want to double down the supply-side opinion. The demand-side grieves the past and says it’s too late to build affordable housing in the city.
If only the government had implemented more oversight in the real estate business ten years ago, we could have saved the city. Now that it’s too late, we need massive overhauls to control greed through affordable housing policy designed to tie one’s income to ones’ access to housing and ensure people don’t need to spend more than 30% of their pre-tax income on housing.
The supply-side opinion REACTS and says, don’t be stupid; all of these policies will simply throttle supply and further push up prices, rents and cost of housing. We need more straightforward, faster-streamlined decision making from City hall. We need less pushback from the NIMBYs {Not In My Back Yard}.
After all, we are experiencing extreme physical limitations due to land constraints. No one can deny that we are limited by the water, the mountains, and the American border. Further, now that we are on the global map, we expect 40,000+ immigrants to British Columbia per year, nearly 10% of the total 400,000+ coming to Canada. So we need to keep building more, faster, bigger, better.
All of these perspectives are valid. We need to build more because how else will we accommodate more people? We need more people because of our aging population and our need to pay for our growing healthcare costs.
We also need to consider neighbourhood quality, maintain historical and heritage sites, and ensure current residents can continue to live well in their homes and places of business.
In a perfect world, we could achieve consensus. But we do not live in an ideal world; we will never get a consensus. The longer we wait for consensus, the more significant impact of our inaction will be on people trying to find homes.
Instead, we should focus on the common ground first and then trade back and forth for mutually satisfactory outcomes. Once a decision is made by stakeholders and authorized by the city’s, dissatisfied NIMBYs are better offer focusing their energy on the next project and trying to impact the result of the subsequent decision instead of trying to stop something that has already successfully been negotiated.
If we are unsuccessful at finding a compromise, there will be real consequences. Our region will lose new immigrants to other parts of the country. We are already seeing the impact of this. In 2021, the five fastest-growing areas in Canada were in BC, but none of these places were in the Lower Mainland. If this trend continues, our region will stagnate, and growth will shift towards Alberta, Saskatchewan, and Manitoba.
Hopefully, by placing action over inaction as our preference, we can all overcome our prejudices, whether they be fear of change, increasing costs of construction, traffic etc. We need to find agreement more often, more quickly, and we need to start now.
When I wake up in the morning, and after, I pick eggs over peanut butter and coffee over tea, the one thing that I prefer over anything else is finding a compromise. That is the true nature of what we do as brokers. From that perspective, I have learned a few things about these supply-side vs demand-side opinion disputes.
1. If you wait for consensus among stakeholders, nothing will ever get done
2. Focus on the common ground first, and then trade back and forth for compromise
3. Due not push responsibility for the lack of adequate shelter in our cities on someone else
In a perfect world, we could achieve consensus. We do not live in an ideal world, so we will not be getting consensus EVER. It will never happen. And the longer we wait for consensus, the more significant the impact of our inaction will be for people trying to find homes for their families and businesses.
Instead, we should focus on the common ground first and then trade back and forth for mutually satisfactory outcomes. Once a decision is made by stakeholders and authorized by the city, the dissatisfied NIMBYs are better offer focusing their energy on the next project and trying to impact the result of the subsequent decision instead of trying to stop something that has already successfully been negotiated.
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