Im­mi­gra­tion tax­ing hous­ing mar­ket

There can be not doubt about the pres­sure im­mi­grants put on hous­ing costs, stats show

Vancouver Sun - - NEWS - DOU­GLAS TODD [email protected]­media.com @dou­glas­todd

The B.C. as­so­ci­a­tion that fights for hous­ing de­vel­op­ers has ex­pressed its ap­pre­ci­a­tion for my re­port­ing on the grow­ing num­ber of in­ter­na­tional stu­dents and im­mi­grants ar­riv­ing in Metro Van­cou­ver.

The Ur­ban De­vel­op­ment In­sti­tute says my ar­ti­cles high­light the need for sup­ply­ing more new homes to keep up with de­mand, mostly from off­shore. And they are right to point to rapid pop­u­la­tion ex­pan­sion as a sig­nif­i­cant part of the hous­ing af­ford­abil­ity story in Metro Van­cou­ver.

So what’s to be done? Should Metro Van­cou­ver politi­cians in­crease the sup­ply of hous­ing, as the UDI urges? Or should they work on try­ing to re­duce de­mand? That’s the nu­cleus of the re­gion’s of­ten ill-na­tured de­bate.

“Over the next 25 years, our prov­ince is ex­pected to grow by more than 1.4 mil­lion peo­ple, partly as a re­sult of the fed­eral gov­ern­ment’s plan to raise im­mi­gra­tion 13 per cent by 2020,” UDI pres­i­dent Anne McMullin wrote this year.

“That means we must work to­gether to cre­ate new homes if we want our chil­dren and grand­chil­dren to have a fu­ture in B.C.”

While it’s hard to ac­cu­rately fore­cast pop­u­la­tion trends, we do know that Metro Van­cou­ver has ex­panded by an av­er­age of al­most 30,000 new im­mi­grants an­nu­ally since 2005.

Mean­while, the pro­por­tion of peo­ple mov­ing to Metro Van­cou­ver from other Cana­dian prov­inces is min­i­mal; it de­clined to about 3,000 last year. And peo­ple are def­i­nitely not driv­ing in from Camp­bell River or Prince Ge­orge to buy prop­erty in Metro.

Ten thou­sand more peo­ple a year are mov­ing out of Metro Van­cou­ver to other parts of the prov­ince than are com­ing here from else­where in B.C. All in all, tak­ing into ac­count deaths and births, Metro Van­cou­ver has ex­panded by 30,000 to 40,000 per­ma­nent new peo­ple a year for the past decade.

These Metro Van­cou­ver fig­ures do not in­clude the many for­eign stu­dents and other non-per­ma­nent res­i­dents flow­ing into Metro Van­cou­ver, need­ing to rent or buy dwellings through fam­ily mem­bers. De­mog­ra­phers con­sider them a wild card.

That stream of non-per­ma­nent new­com­ers is a re­al­ity that few politi­cians, schol­ars, or ed­u­ca­tion of­fi­cials ex­plore. The UDI can­not be blamed for high­light­ing this big de­mo­graphic slice, which an­nu­ally adds more than 140,000 stu­dents and visa-per­mit work­ers to this city of 2.4 mil­lion.

What are the im­pli­ca­tions of such un­prece­dented global mo­bil­ity, of both hu­mans and in many cases their trans-na­tional wealth, for B.C. hous­ing pol­icy? For im­mi­gra­tion pol­icy? For for­eign­stu­dent pol­icy?

De­spite a dire hous­ing cri­sis in Metro Van­cou­ver, Toronto and other ma­jor Cana­dian cities, the in­ti­mate links be­tween hous­ing, im­mi­gra­tion and non-per­ma­nent res­i­dents is rarely ad­dressed, typ­i­cally be­cause of fear of be­ing ac­cused of xeno­pho­bia. But we need a more so­phis­ti­cated de­bate about mi­gra­tion and its in­flu­ence on hous­ing.

A re­lated prob­lem is that politi­cians are fail­ing to co-op­er­ate with each other. City coun­cils de­ter­mine prop­erty zon­ing. Pro­vin­cial gov­ern­ments set tax pol­icy on hous­ing. The fed­eral gov­ern­ment con­trols im­mi­gra­tion. Ed­u­ca­tion of­fi­cials, both pub­lic and pri­vate, wel­come for­eign stu­dents. But all op­er­ate in their own si­los, of­ten work­ing against one an­other on af­ford­abil­ity.

It won’t be ef­fec­tive to just build more hous­ing sup­ply in re­sponse to high in-mi­gra­tion, says Si­mon Fraser Univer­sity po­lit­i­cal sci­en­tist San­jay Jeram.

“Many key voices on this is­sue have demon­strated that hous­ing prices have be­come very dis­con­nected from lo­cal in­comes. Only fo­cus­ing on sup­ply doesn’t work if the Lower Main­land hap­pens to at­tract im­mi­grants with wellabove av­er­age lev­els of for­eign­sourced wealth,” Jeram said.

“If this pat­tern con­tin­ues and be­comes more prom­i­nent, hous­ing prices will con­tinue to rise and shut out of the hous­ing mar­ket those who earn their in­comes and pay their taxes in Metro. Any so­lu­tion has to fo­cus on sup­ply and de­mand.”

Like other schol­ars, Jeram points to the dif­fi­cult-to-grasp fact that Metro Van­cou­ver hous­ing costs have soared in part be­cause a por­tion of the re­gion’s hous­ing sup­ply, es­pe­cially at the high end, is be­ing pur­chased with money that wealthy trans-na­tion­als make out­side the coun­try, where Canada can­not tax their in­come.

“Van­cou­ver is not a pop­u­lar des­ti­na­tion with mi­grants from within Canada. So, on one hand, im­mi­gra­tion is needed to sus­tain and boost the pop­u­la­tion,” Jeram said. “How­ever, the cor­re­la­tion, not nec­es­sar­ily the cau­sa­tion, be­tween for­eign im­mi­gra­tion and ris­ing hous­ing prices is some­thing to take note of. It is not a sim­ple mat­ter of (ad­just­ing im­mi­gra­tion) lev­els, but of how for­eign-sourced money is finding its way into the Van­cou­ver hous­ing mar­ket.”

There is no sta­tis­ti­cal doubt, how­ever, that im­mi­grants put pres­sure on hous­ing costs, par­tic­u­larly in Metro Van­cou­ver and Toronto.

UBC geog­ra­phy pro­fes­sor Daniel Hiebert has found most im­mi­grants show greater de­ter­mi­na­tion than Cana­dian-born cit­i­zens to buy hous­ing in Canada’s three ma­jor cities. Hiebert’s peer­re­viewed study en­hances ear­lier re­search by UBC ge­og­ra­pher David Ley, as well as the Con­fer­ence Board of Canada, that has shown a strong cor­re­la­tion be­tween rapid im­mi­gra­tion and pricey hous­ing in Van­cou­ver and Toronto.

“First and fore­most, im­mi­gra­tion pol­icy is, es­sen­tially, also a form of hous­ing pol­icy,” Hiebert says in his com­pre­hen­sive pa­per in the Cana­dian Jour­nal of Ur­ban Re­search.

“Metropoli­tan hous­ing in Canada would, very likely, look to­tally dif­fer­ent if the scale of im­mi­gra­tion were to change dra­mat­i­cally in ei­ther di­rec­tion. The re­cent de­ci­sion ( by Prime Minister Justin Trudeau) to raise per­ma­nent im­mi­gra­tion ad­mis­sion lev­els from ap­prox­i­mately 270,000 in 2015 to 340,000 in 2020 will surely have a sig­nif­i­cant im­pact.”

The Ur­ban De­vel­op­ment In­sti­tute and the B.C. Busi­ness Coun­cil, mean­while, en­cour­age gov­ern­ments to bring in im­mi­grants and for­eign stu­dents and in­crease den­sity by ar­gu­ing it is ben­e­fi­cial for the econ­omy.

But oth­ers cau­tion that, while the real es­tate in­dus­try and the over­all econ­omy might be win­ning be­cause of high im­mi­gra­tion, too many in­di­vid­u­als are los­ing. Many renters and would-be home­own­ers are be­ing squeezed out of de­cent hous­ing in a city that De­mographia ranks among the three most un­af­ford­able cities out of more than 400 sur­veyed.

Are we mak­ing any progress at un­rav­el­ling the knots formed by the many links be­tween hous­ing and mi­gra­tion?

It is not a sim­ple mat­ter of (ad­just­ing im­mi­gra­tion) lev­els, but of how for­eign-sourced money is finding its way into the Van­cou­ver hous­ing mar­ket. San­jay Jeram, Si­mon Fraser Univer­sity po­lit­i­cal sci­en­tist Metro Van­cou­ver has ex­panded by an av­er­age of al­most 30,000 new im­mi­grants an­nu­ally.

Next week, I’ll look at the num­ber ■ of hous­ing units be­ing built in Metro Van­cou­ver, why the last prime minister to lower im­mi­gra­tion rates did so, and whether it is pos­si­ble to change the pat­tern that sees the vast ma­jor­ity of mi­grants fun­nelling into Canada’s big­gest cities.

Ur­ban De­vel­op­ment In­sti­tute pres­i­dent Anne McMullin says B.C.’s pop­u­la­tion will grow by 1.4 mil­lion peo­ple over the next 25 years.

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