The federal and British Columbia governments are developing a program to purchase more than 2,200 condos in B.C. to turn into affordable housing, though the financial mechanism that will be used to make the acquisitions is still up in the air.
Nearly 4,000 newly built condos are sitting empty in the Vancouver region, according to data from Zonda Urban, as investors shy away from buying real estate that has become increasingly unprofitable.
Prime Minister Mark Carney’s government is looking for ways to unfreeze the condo markets in B.C. and in the Greater Toronto Area where preconstruction condo sales have dropped sharply.
On Tuesday, the federal housing and infrastructure department provided a few more details, and confirmed the units will be acquired.
“Build Canada Homes and the B.C. government are working on a plan to acquire and convert more than 2,200 existing condo units into affordable homes,” Steve Cloutier, manager of media and issues management for Housing, Infrastructure and Communities Canada, said in an e-mailed statement.
He did not provide a total amount of funding that will be set aside for the purchases.
Vancouver East NDP MP Jenny Kwan is urging Ottawa and the province to reconsider the plan.
She said the funding appears to direct substantial public resources toward supporting private developers, who made the decision to build during a period of rapidly rising prices and profits.
“While those profits accrued privately during the boom years, taxpayers are now being asked to shoulder the consequences of a cooling market,” Ms. Kwan said in a June 23 letter addressed to the federal and provincial housing ministers.
B.C. developers had been publicly urging the province to follow Ontario’s policies and expand the sales tax rebate on new homes. One developer, Wesgroup Properties, said the industry was surprised by last week’s announcement.
“We did not advocate for it. We did not ask for it,” said Beau Jarvis, Wesgroup’s chief executive. Mr. Jarvis said he wasn’t aware of anyone in his industry that was consulted on the government’s plan.
