The count stood at 4,376. That is how many completed condos were sitting empty in Metro Vancouver last month, according to figures from the Canada Mortgage and Housing Corporation, a 76 per cent jump from a year earlier. Against that backdrop, Prime Minister Mark Carney and B.C. Premier David Eby announced a plan on Thursday to take over some of them.
Over the next 10 years, Ottawa will invest more than $5 billion in British Columbia’s local infrastructure through the Build Communities Strong Fund. One piece is a Canada-British Columbia Partnership on Condo Conversion, which will use “innovative financing tools” to turn more than 2,200 vacant condo units into affordable homes. The Prime Minister’s Office called it “one of the fastest and most efficient ways to increase housing supply.”
Carney said the government will use the “right financial mechanisms” to take condos that might otherwise stay empty “potentially for another couple of years.” He did not say whether units would be bought in bulk below market value. Eby said the program recognizes that built housing exists that people would love to make their first home but cannot afford.
The bailout charge
Conservative Leader Pierre Poilievre, speaking to reporters in Vancouver on Sunday, called the plan a “bailout” and said it should be cancelled immediately. “They decided they wanted to build those condos at a time when we were in a housing bubble,” he said. “But now they’re selling those homes at a time when the housing bubble has burst. So the risk did not pay off.” He said Carney “wants to privatize the profit and socialize the losses.”
Some housing experts and provincial parties have made a similar case. Andy Yan, director of Simon Fraser University’s City Program, asked how much of the plan “is really a way of helping out the industry versus, I think, a bailout in terms of bad business decisions by some of these developers?”
The answer may turn on price, and that is unknown. Mike Moffatt, founding director of the Missing Middle Initiative at the University of Ottawa, said the public does not yet know what governments will pay or what discount, if any, they will get against listing prices. The federal government has promised more detail in the months ahead. “If they’re paying something close to full price, then yeah, I think it would be fair to characterize that as a bailout,” Moffatt said. If governments force a steep discount while buying homes they would have built anyway, he said, the plan can make sense.
Moffatt also noted that private investment firms are already bulk-buying condo inventory at discounts in Vancouver and Toronto.
Developers and the toolkit
Brad Jones, chief development officer at Wesgroup Properties, rejected the label. “If the industry wanted a bailout we would have asked for it,” he said. Developers, he said, wanted something like the March deal between Ottawa and Ontario that removed the GST for first-time homebuyers and cut municipal development charges.
The B.C. agreement does include fee relief. Ottawa is putting up $1.6 billion over 10 years, matched by the province, to lower development charges for multi-unit housing in priority communities. Carney said cutting those charges by up to 50 per cent could save builders up to $40,000 per unit. Wendy McNeil, CEO of the Homebuilders Association Vancouver, said the fees can add as much as 30 per cent to the cost of building condos.
Housing Minister Gregor Robertson described the condo purchases as one tool in “the broader toolkit,” with Build Canada Homes as the main way to expand the stock of affordable homes. Yan raised another worry: what happens to the value of a unit when the government buys the one next door. He said the rise in unsold condos is recent enough that it may be better to let the market correct itself.
Sources
- Federal-B.C. plan to buy vacant condos just one tool to make affordable housing available: minister
- Mark Carney’s plan to bulk-buy unsold Vancouver condos might be a bailout, but it doesn’t have to be | RCI
- Poilievre slams federal-B.C. plan to buy vacant condos, calling it a 'bailout' for developers
