103: The Housing Market's Not Crashing, The Industry Is with Urban Development Institute's Anne McMullin

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Welcome back to the Colonial Real
Estate Podcast.

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I'm your mortgage broker host,
Taylor Atkinson.

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And I'm your real estate agent
host, Matt Glenn.

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What's cooking today, Taylor?
Oh, cooking.

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Yeah, we went to Lake House last
night for a little cooking class.

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It was incredible, man.

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Really cool spot.

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Your Instagram was popping off.

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It looked awesome.

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Yeah.

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I mean, you walk out of there with

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tons of confidence.

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We cooked paella.

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Oh, yeah.

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You know, so you're like, oh, I

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could definitely cook this at
home.

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But they do a bunch of the prep
work and coach you through it.

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It was awesome.

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I think Emily and I were the only

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ones that didn't walk away with
leftovers.

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We ate it all.

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Such a cool experience and

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beautiful venue.

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Like if anyone hasn't been there,

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book a class.

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It is a little bit more expensive.

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But when you think about like.

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the cost of that kitchen and the

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chef and the ingredients and
everything, it's well worth it.

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There's good value there.

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Yeah, Chef Travis Pye runs a good

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ship there.

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runs a good ship there.

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He's doing good things.

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That's just one of the fun

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activities we've done this summer
locally.

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Nice.

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We want to jump into talking about

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the show.

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It was an awesome show today, Anne

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McMullen.

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She is the president and CEO of

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UDI, so Urban Development
Institute.

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If you're part of... their program
or have listened to them or seen

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her on LinkedIn, like just an
awesome organization.

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Basically, they're like the voice
of, you know, mostly a group of

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developers and professionals in
the industry.

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Pretty big group of developers,
though, like most of them.

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Yeah, there's 850 members and they
advocate, you know, at like a BC

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provincial level with the housing
minister and EB and like she's

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really.

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just like a great voice and hard

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to be in like a balancing act in
that position, right?

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Like most of us just sit here and
kind of complain about

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legislation.

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She's actually providing like

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solutions at a government level.

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Well, she's talking to everyone

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that's affected by all these
swinging rule changes and not very

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well conceived rules and laws that
come out.

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Yeah.

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We go into quite a few different

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ones in this episode and she lays
out the reasons pretty well.

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Yeah.

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I mean, one that like I thought

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was, hilarious in like a bad
policy she highlighted that

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developments in vancouver have to
have a million dollar allocation

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to artwork for a building which is
just humorous if we're talking

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about affordability and putting
units out there.

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And like, I love Vancouver, like
the artwork around those buildings

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is incredible.

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And now it kind of makes sense.

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You're forcing a developer to
spend a million dollars on art.

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It just goes down to the end
consumer.

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You know, let's say like a 50 unit
building, that's 20 grand a pop.

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Like if someone is out there
buying, would you rather have like

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20 grand off your purchase price
or like a really cool statue when

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you walk into the lobby?
into the lobby?

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I don't know.

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Well, it's funny.

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Like the art idea is a good idea,
but then you're also talking about

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affordability.

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It's like, okay, well, where can

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we cut costs?
The other one that she highlights

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here is a 20 % social housing
aspect and the new buildings.

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And then we went into quite a bit
of detail in the pod about this.

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And then I heard the story about
Curve, the big building in

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Vancouver that just went into
basically foreclosing and

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receivership now.

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And then you read the stories and

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like...

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Just check this out.

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The project was approved by City
in Vancouver in 2022, but has yet

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to reach the construction stage.

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Earlier this year, the developers

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secured approval to cut the
planned social housing units in

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exchange for a $55 million cash in
lieu payment.

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So they had to pay $55 million to
the city to not have social

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housing, like a luxury building
right in probably the richest part

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in Vancouver.

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And then now it's a receivership.

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Wonder why.

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That is insane.

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is insane.

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Like that is just kind of the

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theme of this show is like one
person's not speaking to the other

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person.

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You know, like we need to build

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units.

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We need developers to like be part

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of this solution.

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And they're just being handcuffed

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with like crazy policy.

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That is so crazy.

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Like $55 billion.

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So that ups the price of all those

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units.

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On one hand, you're going to bitch

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that the units are too expensive,
but then you're also going to up

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them all by, what is that?
How many?

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I don't even know how many units
are in that project, but it's got

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to be three or $400 ,000 a unit
just to pay for that.

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pay for that.

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But then where does that money go?

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It gets allocated to social
housing elsewhere in the city.

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Yeah, I know.

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I'm not sure about that.

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That was a tug -of -cheek.

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But now that the economy is

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getting tighter and things are
getting squeezed, we get to hear

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all these crazy stories and pay
attention to them.

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And it's just like, wow.

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Another funny thing about this

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curve is it was just vacant lots
before.

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It wasn't like they kicked anyone
out.

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It was just a vacant house.

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They're putting more housing in.

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And government, in this case, the
city of Vancouver, says 55 million

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bucks to not have social housing
where it doesn't really fit in

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anyway.

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I wonder how they came up with

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that number.

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Yeah, honestly.

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50 was two rounds, so just tack on
another five.

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After a couple of beers, After a
couple of beers, like, just double

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it, man.

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Yeah, the other point, you know,

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we kind of spoke about, which
you've spoken about, you know,

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fairly passionately a bunch, is
the foreign buyer ban.

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It does not make any sense.

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It does not make any sense.

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Like, especially, I understand
maybe back when, I guess, Chinese

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people were buying all the
expensive houses and keeping them

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vacant.

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But now we have a vacant house tax

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and a foreign buyer ban.

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Like, just think about this

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foreign buyer ban.

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Like, A, what's going down in the

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U .S.?
We have basically an opportunity

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to brain drain so much of the US
so they can come to Canada, but

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they can't buy a house when they
get here.

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Thanks for that.

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Also, she said it in the show, but

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it is kind of racist to say
Chinese or Asians can't buy houses

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in Canada.

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If you just look at a map, look

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how big our country is.

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And can't buy a house here unless

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you live here.

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Like what?

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Yeah.

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And she highlighted like it's kind

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of geographical.

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So, you know, in certain parts of

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greater Vancouver is really where
it's being affected most.

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But one, like, you know, who cares
if they're buying pre

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-construction development?
Like that's great.

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It's investment to our economy,
which we need.

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And then the other fact would be,
you know, luxury homes in like

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North Vancouver or something,
which is like, again, who cares?

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You're pumping cash into the
economy.

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cash into the economy.

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Why are we just saying no to that

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money?
Even if it's like 100 transactions

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a year, it's absolutely a drop in
the bucket.

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But it's not even just like the
capital being invested in the

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economy, it's the confidence.

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Like who internationally was even

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interested in investing in
anything in Canada right now, let

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alone housing, if like we're
restricting them to.

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So it was a really cool show.

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it was a really cool show.

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Okay, let's just stick on these
pre -sales.

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Agreed.

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So like we talk about this, like

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the pre -sales, like how they get
off the ground.

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We've talked about it on the show,
like many episodes, developers

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have to hit a certain amount of
sales before they can even get the

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financing to build these projects.

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So like when you're buying a pre

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-sale, you're basically paying
money to finance a project to put

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more units on.

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Right.

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So when you just make it hard as
possible to do this, we need more

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housing.

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We need more housing.

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Everyone says it.

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Everyone knows it.

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The path should be cleared for you
to do this and not just roadblock

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after roadblock after roadblock to
get these projects off the ground.

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It just does not make any sense.

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Yeah.

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There was also a post.

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I mean, there's a bunch of

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different municipalities across
Canada, but I think Vancouver,

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like new single family home sales
were down like 58 % from last

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year.

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It's like.

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no one is building homes because
no one's buying these homes

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because they just cannot afford
like DCC fees or like artwork or

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like any of these policies.

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So anyways, I guess like, you

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know, Anne's kind of in the weeds.

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Speaking to developers, speaking

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to government, she's kind of the
middle person, you know, trying to

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find a middle ground that works.

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Yeah, a lot of great stuff in this

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show.

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So I think you guys are going to

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enjoy it.

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All right.

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This episode, like every episode,
sponsored by Century 21 Insurance

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Realty, the best brokerage in the
interior of BC.

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We're in it.

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We are putting offices in

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Salmonar, Vernon, Creston,
Castlegar.

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Kamloops.

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We're all over the interior.

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So if you're a buyer or seller
looking for an agent, give us a

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call.

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Or if you're an agent looking for

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a brokerage, give us a call and
enjoy the episode.

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It's a good one.

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Okay.

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Anne, welcome to the show.

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So grateful to have you here

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today.

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Pleasure to be here.

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Thank you.

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First of all, can you just kind of

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give us a real high level who you
are and what you do?

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Yes.

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My name is Anne McMullen and I'm

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the president and CEO of the Urban
Development Institute.

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which is an organization that
represents the commercial,

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residential and industrial
developers in British Columbia.

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And we advocate on behalf of the
industry and also provide

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00:07:42,830 --> 00:07:43,650
opportunities for networking and
education for our membership.

263
00:07:43,650 --> 00:07:44,930
Our membership is about 850
companies.

264
00:07:44,930 --> 00:07:50,170
You join UDI as a company, not as
an individual.

265
00:07:50,570 --> 00:07:53,510
And we represent what is the
development industry.

266
00:07:53,510 --> 00:07:55,810
So it'd be all the major
developers in British Columbia, as

267
00:07:55,810 --> 00:07:57,030
well as architectural firms,
engineering firms, accounting

268
00:07:57,030 --> 00:07:57,210
firms.

269
00:07:57,210 --> 00:07:58,250
company that is related to the

270
00:07:58,250 --> 00:08:00,250
process of development.

271
00:08:00,250 --> 00:08:01,690
Yeah, we represent literally

272
00:08:01,690 --> 00:08:03,990
hundreds of thousands of people
throughout British Columbia.

273
00:08:03,990 --> 00:08:04,370
Awesome.

274
00:08:04,370 --> 00:08:05,990
Well, so yeah, you guys are

275
00:08:05,990 --> 00:08:08,220
obviously have, what do you call
them?

276
00:08:08,220 --> 00:08:11,460
Like an event, like in Kelowna,
you're based in Kelowna,

277
00:08:11,460 --> 00:08:14,320
Vancouver, where else in BC?
And Victoria.

278
00:08:14,320 --> 00:08:16,240
And Victoria?
We have an office in Victoria, And

279
00:08:16,240 --> 00:08:16,540
Victoria.

280
00:08:16,540 --> 00:08:17,460
And Victoria?

281
00:08:17,460 --> 00:08:23,840
We have an office in Victoria, an
office, as you said, in Kelowna,

282
00:08:23,840 --> 00:08:27,140
our main office, I guess, or our
head office, downtown Vancouver.

283
00:08:27,140 --> 00:08:30,760
I didn't know that you guys were
so intertwined at a government

284
00:08:30,760 --> 00:08:31,320
level, advocating and giving
feedback.

285
00:08:31,320 --> 00:08:33,820
And that communication line is so
well open.

286
00:08:33,820 --> 00:08:39,820
So I guess is that one of your
main jobs is to take feedback from

287
00:08:39,820 --> 00:08:42,039
developers and provide a backup.

288
00:08:42,039 --> 00:08:43,940
a government level and vice versa,

289
00:08:43,940 --> 00:08:46,940
you know, when you hear policy
coming down the pipeline, like

290
00:08:46,940 --> 00:08:48,860
provide that to developers?
Yeah, that's exactly what we do.

291
00:08:49,180 --> 00:08:51,900
You know, I have a large board,
but then we have a tighter

292
00:08:52,460 --> 00:08:54,660
executive committee made up of
nine people and we meet monthly.

293
00:08:52,460 --> 00:08:54,980
In fact, we probably meet and talk
almost every day, many of them.

294
00:08:55,020 --> 00:08:57,060
That is our job is to advocate on
behalf of the industry.

295
00:08:57,060 --> 00:09:00,580
And we work with all three levels
of government at the municipal

296
00:09:00,580 --> 00:09:03,400
level, the provincial level and
the federal level.

297
00:09:03,620 --> 00:09:05,820
And we work both with elected
officials.

298
00:09:05,820 --> 00:09:07,720
and the regulators, the
bureaucracy.

299
00:09:07,720 --> 00:09:10,800
And it's just exactly as you say,
whether it's policy that is being

300
00:09:10,800 --> 00:09:14,140
developed by government or more
often, we've got recommendations

301
00:09:14,140 --> 00:09:15,150
of how to improve policy.

302
00:09:15,150 --> 00:09:17,070
And so that is a huge part of what

303
00:09:17,070 --> 00:09:17,510
we do.

304
00:09:17,510 --> 00:09:19,050
And we have very strong working

305
00:09:19,050 --> 00:09:21,230
relationships with all levels of
government and with bureaucracy.

306
00:09:21,230 --> 00:09:23,730
We've been at it a long time and
our information is always factual,

307
00:09:23,730 --> 00:09:26,150
data -driven, and we come up with
solid solutions.

308
00:09:26,150 --> 00:09:26,750
And so really...

309
00:09:26,910 --> 00:09:28,210
Our job is to advocate on behalf

310
00:09:28,210 --> 00:09:30,290
of the industry, but also to help
the government as well.

311
00:09:30,290 --> 00:09:32,830
But also really, it's about
creating great communities.

312
00:09:32,830 --> 00:09:33,250
Yeah.

313
00:09:33,250 --> 00:09:35,030
I mean, one of your most recent

314
00:09:35,030 --> 00:09:37,990
posts, it's a little bit, I don't
want to say depressing, but there

315
00:09:37,990 --> 00:09:41,210
are obviously a lot of developers
being vocal about having layoffs

316
00:09:41,210 --> 00:09:42,970
and struggling right now.

317
00:09:42,970 --> 00:09:44,810
Do you want to try and summarize

318
00:09:44,810 --> 00:09:46,010
that post a little bit?
Yes.

319
00:09:46,010 --> 00:09:51,130
And I think that's the crux of the
issue that we have right now is

320
00:09:51,330 --> 00:09:52,810
the cost of building.

321
00:09:52,810 --> 00:09:53,690
homes is more expensive than the

322
00:09:53,690 --> 00:09:54,950
average person in British Columbia
can afford.

323
00:09:54,950 --> 00:09:57,990
And as a result, we're seeing Less
projects launching.

324
00:09:57,990 --> 00:09:59,610
We're seeing less starts, less
applications.

325
00:09:59,610 --> 00:10:02,990
And as a result, we're going to
start seeing layoffs, which we've

326
00:10:02,990 --> 00:10:04,090
already started to see.

327
00:10:04,090 --> 00:10:05,850
So we've had enormous pressures,

328
00:10:05,850 --> 00:10:06,530
of course.

329
00:10:06,790 --> 00:10:08,290
We've seen rising interest rates,

330
00:10:08,290 --> 00:10:09,490
although they've come down a bit.

331
00:10:09,490 --> 00:10:10,470
We've had escalation in

332
00:10:10,470 --> 00:10:10,970
construction costs.

333
00:10:10,970 --> 00:10:12,030
And of course, labor costs always

334
00:10:12,030 --> 00:10:15,170
go up due to inflation and cost of
living increases.

335
00:10:15,170 --> 00:10:17,330
And we can't do anything about
those.

336
00:10:17,330 --> 00:10:19,650
But what government can play a
role in is production of policies

337
00:10:19,650 --> 00:10:21,610
and taxation and fees and charges.

338
00:10:21,610 --> 00:10:24,870
And so now in some cases, it's

339
00:10:25,070 --> 00:10:27,390
fees, taxes, charges, and even
sort of cost of waiting for

340
00:10:27,390 --> 00:10:30,730
processing can add up to 30 % of
the cost of building a new home.

341
00:10:30,730 --> 00:10:34,110
And when median incomes in this
province, household incomes are

342
00:10:34,110 --> 00:10:38,450
about $100 ,000, when you get up
to a certain price point, the

343
00:10:38,610 --> 00:10:39,570
buyer can't afford it.

344
00:10:39,770 --> 00:10:42,470
And we've been warning all levels

345
00:10:42,470 --> 00:10:45,510
of government that we're getting
to that point.

346
00:10:45,510 --> 00:10:48,230
You can't keep adding fees and
charges and costs and all these

347
00:10:48,230 --> 00:10:48,570
things.

348
00:10:48,570 --> 00:10:50,350
We're going to hit the ceiling.

349
00:10:50,350 --> 00:10:53,610
And we've hit that ceiling for 80
% of the population can only

350
00:10:53,610 --> 00:10:55,510
afford up to about $850 ,000.

351
00:10:55,510 --> 00:10:57,490
So that's why we're seeing a real

352
00:10:57,490 --> 00:10:57,810
slowdown.

353
00:10:57,810 --> 00:11:00,170
And the repercussions of that are

354
00:11:00,170 --> 00:11:02,490
just starting to be felt because
these things, unfortunately, take

355
00:11:02,490 --> 00:11:02,970
time.

356
00:11:02,970 --> 00:11:05,210
If a developer puts an application

357
00:11:05,210 --> 00:11:07,010
in or maybe slows down on a
project.

358
00:11:07,010 --> 00:11:11,100
or got a building permit but
doesn't go ahead with that

359
00:11:11,100 --> 00:11:14,300
project, then the people that were
working on it, you know, is the

360
00:11:14,300 --> 00:11:15,600
potential of layoffs.

361
00:11:15,600 --> 00:11:18,420
So we have seen layoffs at West

362
00:11:18,420 --> 00:11:19,840
Group, at Rennie, and at other
companies.

363
00:11:19,840 --> 00:11:24,220
And I know that engineering firms
and architectural firms are all

364
00:11:24,220 --> 00:11:27,480
waiting and wondering when is this
going to fall.

365
00:11:27,480 --> 00:11:30,520
And the industry really isn't in a
state of crises, but it's that

366
00:11:30,520 --> 00:11:33,700
cost of how much it costs to build
and what people can afford.

367
00:11:33,820 --> 00:11:36,240
So it's complicated, but in a way,
it's just simple arithmetic.

368
00:11:36,240 --> 00:11:37,180
It's just simple math.

369
00:11:37,180 --> 00:11:37,580
When you're producing something

370
00:11:37,580 --> 00:11:39,760
that people want but can't afford.

371
00:11:39,760 --> 00:11:42,080
It doesn't get sold, so then you

372
00:11:42,080 --> 00:11:42,980
don't build it.

373
00:11:42,980 --> 00:11:44,560
They don't make it.

374
00:11:45,080 --> 00:11:47,560
The government's been receptive to
any of your suggestions or

375
00:11:47,560 --> 00:11:50,340
anything?
Yes, but this isn't a criticism of

376
00:11:50,340 --> 00:11:53,220
government, and I don't want to
come across it, but government is

377
00:11:53,220 --> 00:11:53,980
very slow.

378
00:11:53,980 --> 00:11:55,420
They've got many competing

379
00:11:55,420 --> 00:11:55,700
interests.

380
00:11:55,700 --> 00:11:57,060
And the latest announcement, which

381
00:11:57,340 --> 00:11:59,600
was paying the majority of the
development cost charges at

382
00:11:59,600 --> 00:12:01,620
occupancy rather than a building
permit, you're saving the interest

383
00:12:01,620 --> 00:12:03,220
on that money over that three or
four year period.

384
00:12:03,360 --> 00:12:04,420
You know, we've been working on
that.

385
00:12:04,420 --> 00:12:06,960
We had to demonstrate it from a
financial viability perspective.

386
00:12:06,960 --> 00:12:09,960
The government need to figure out,
you know, what's it going to cost

387
00:12:09,960 --> 00:12:11,500
the government or not going to
cost the government.

388
00:12:11,500 --> 00:12:13,260
And then it's got to go to
cabinet.

389
00:12:13,260 --> 00:12:15,120
You know, so these things just
take time.

390
00:12:15,120 --> 00:12:15,800
And so it's unfortunate.

391
00:12:15,800 --> 00:12:17,380
because it took time to get here

392
00:12:17,560 --> 00:12:19,380
and not take time to unwind.

393
00:12:19,380 --> 00:12:20,280
But there is receptivity.

394
00:12:20,280 --> 00:12:21,620
Yes, very much so.

395
00:12:21,620 --> 00:12:23,160
And some municipalities are better

396
00:12:23,160 --> 00:12:23,900
than others.

397
00:12:23,900 --> 00:12:26,560
And the provincial government is

398
00:12:26,560 --> 00:12:28,380
not receptive to it because they
don't want to see layoffs.

399
00:12:28,380 --> 00:12:31,560
But now we've got to go back to
the drawing board.

400
00:12:31,560 --> 00:12:35,300
Okay, how do we do this?
How do we unwind that?

401
00:12:35,300 --> 00:12:36,260
You know, what are the unintended
consequences?

402
00:12:36,260 --> 00:12:38,820
So it's, well, frustrating, I
guess, because I don't like the

403
00:12:38,820 --> 00:12:43,140
phrase, but I do feel a little
bit, we told you so, but here we

404
00:12:43,140 --> 00:12:43,220
are.

405
00:12:43,220 --> 00:12:46,160
So the DCC is being paid at

406
00:12:46,160 --> 00:12:46,300
occupancy.

407
00:12:46,300 --> 00:12:48,280
DCC is being paid at occupancy.

408
00:12:48,280 --> 00:12:49,200
That's not in Kelowna.

409
00:12:49,200 --> 00:12:50,000
Is that a Vancouver thing?

410
00:12:50,000 --> 00:12:51,380
No, it's a British Columbia thing.

411
00:12:51,380 --> 00:12:52,620
I think it starts January, 2026.

412
00:12:52,620 --> 00:12:56,260
So you can pay 25 % of your DCC at
building permit, and then you can

413
00:12:56,260 --> 00:12:58,780
hold off 75 % of the rest of it
for four years or at occupancy,

414
00:12:58,780 --> 00:12:59,180
whichever comes first.

415
00:12:59,180 --> 00:13:00,420
The developer has to take out a

416
00:13:00,420 --> 00:13:03,540
surety bond to guarantee that that
money is paid.

417
00:13:03,540 --> 00:13:05,460
So the municipalities are left
whole.

418
00:13:05,460 --> 00:13:07,360
So it's no cost to municipalities
because they also have the

419
00:13:07,360 --> 00:13:09,440
guarantee that it will get paid.

420
00:13:09,440 --> 00:13:11,420
For the developer, what it is, is

421
00:13:11,420 --> 00:13:11,880
it's saving.

422
00:13:11,880 --> 00:13:13,460
the interest on that money that

423
00:13:13,460 --> 00:13:15,840
they would have to borrow to pay
for the DCC because they don't get

424
00:13:15,840 --> 00:13:17,100
paid for the building, in a sense,
until you occupy.

425
00:13:17,100 --> 00:13:18,340
When you close, then you as a
buyer pay.

426
00:13:18,340 --> 00:13:22,600
So the development cost charge, it
could be like $30 or $40 million.

427
00:13:22,640 --> 00:13:25,200
So you're saving, let's say, 4 .5
% on $30 million or $40 million.

428
00:13:25,200 --> 00:13:25,880
It all adds up.

429
00:13:25,880 --> 00:13:27,240
Will this get things moving?

430
00:13:27,240 --> 00:13:28,980
It might for some.

431
00:13:28,980 --> 00:13:28,980
But there's been so many fees,

432
00:13:28,980 --> 00:13:31,260
charges, taxes, policies that have
been layered on over the last

433
00:13:31,260 --> 00:13:31,700
number of years.

434
00:13:31,700 --> 00:13:33,560
We need to change about 15 things

435
00:13:33,720 --> 00:13:34,460
to really make a difference.

436
00:13:34,620 --> 00:13:36,920
I mean, we've brought this up a

437
00:13:36,920 --> 00:13:40,060
few times over the last two years,
probably like, yeah, let's delay

438
00:13:40,060 --> 00:13:41,000
DCCs until occupancy.

439
00:13:41,000 --> 00:13:41,780
Seems like a no -brainer.

440
00:13:41,780 --> 00:13:48,680
I guess my only question in
regards to that is, is the DCC, is

441
00:13:48,680 --> 00:13:50,920
it locked in at the time of the
application?

442
00:13:50,920 --> 00:13:55,480
Like, that's how much you pay?
Or is it, you know, let's say...

443
00:13:55,480 --> 00:13:59,020
They pay 25 % of the DCCs now, and
then in three years, they have

444
00:13:59,020 --> 00:13:59,420
occupancy.

445
00:13:59,620 --> 00:14:01,520
Is it based on the new DCC fees in

446
00:14:01,850 --> 00:14:03,490
like 2028?
That's right.

447
00:14:03,490 --> 00:14:03,690
right.

448
00:14:03,690 --> 00:14:04,610
It will depend on the

449
00:14:04,610 --> 00:14:06,710
municipality, right?
So, you know, like Surrey, for

450
00:14:06,710 --> 00:14:08,690
instance, said they're not raising
their DCC fees.

451
00:14:08,690 --> 00:14:10,610
So it will depend on the
municipality.

452
00:14:10,610 --> 00:14:13,530
Have you been dealing with this
new GST for some home buyers?

453
00:14:13,530 --> 00:14:15,330
That is a rebate and not an
exemption.

454
00:14:15,330 --> 00:14:19,070
It's confusing because I had a
buyer walk out of a deal recently

455
00:14:19,070 --> 00:14:23,450
because they just didn't have the
cash to pay for it to get the

456
00:14:23,450 --> 00:14:24,270
rebate in the future.

457
00:14:24,270 --> 00:14:26,240
Almost seems it's not really

458
00:14:26,240 --> 00:14:27,540
helping the right people.

459
00:14:27,680 --> 00:14:29,400
Do you have any thoughts on that?

460
00:14:29,400 --> 00:14:29,940
I agree.

461
00:14:29,940 --> 00:14:30,920
You know, governments have often

462
00:14:30,920 --> 00:14:34,200
well -intentioned policies, but in
practice, so it depends, you know,

463
00:14:34,200 --> 00:14:36,480
the ability of a developer too, to
say, okay, well, we'll pay it.

464
00:14:36,480 --> 00:14:38,980
There's a way of almost loaning it
to the buyer.

465
00:14:38,980 --> 00:14:42,780
So sort of creative solutions in
that regard, because yeah, you've

466
00:14:42,780 --> 00:14:44,640
got to come up with the money.

467
00:14:44,640 --> 00:14:47,380
Can you go to your bank and borrow

468
00:14:47,380 --> 00:14:49,980
it through a line of credit?
But often as first -time

469
00:14:49,980 --> 00:14:52,320
homebuyers, they're using their
very last penny.

470
00:14:52,320 --> 00:14:57,050
Like, I don't even have any money
to give you so that you can give

471
00:14:57,050 --> 00:14:57,770
me back.

472
00:14:57,890 --> 00:15:00,160
Like, I don't have the five bucks,

473
00:15:00,160 --> 00:15:01,880
I don't have the five bucks,
right?

474
00:15:01,880 --> 00:15:04,580
If you have the money, you don't
need to help.

475
00:15:04,580 --> 00:15:07,100
Yeah, it's like, can you loan me
five bucks?

476
00:15:07,100 --> 00:15:08,260
you don't need to help.

477
00:15:08,260 --> 00:15:10,140
Yeah, it's like, can you loan me

478
00:15:10,140 --> 00:15:12,180
five bucks?
I don't have five bucks to loan

479
00:15:12,180 --> 00:15:12,340
you.

480
00:15:12,340 --> 00:15:15,020
So even if you're going to give it

481
00:15:15,020 --> 00:15:17,240
back to me, I don't have it.

482
00:15:17,240 --> 00:15:18,600
But yeah, so there are sort of

483
00:15:18,600 --> 00:15:20,520
creative ways of looking at, can
the developer help the first -time

484
00:15:20,520 --> 00:15:21,720
homebuyer?
And so once they close, you know,

485
00:15:21,720 --> 00:15:22,240
then it's deducted.

486
00:15:22,240 --> 00:15:23,940
So even if you're going to give it

487
00:15:23,940 --> 00:15:25,830
back to me, I don't it.

488
00:15:25,830 --> 00:15:26,390
So there's creative ways.

489
00:15:26,570 --> 00:15:28,530
But it's a huge amount of money.

490
00:15:28,530 --> 00:15:32,110
So it's you and me that are

491
00:15:32,110 --> 00:15:33,590
ultimately paying for it through
our taxes.

492
00:15:33,590 --> 00:15:36,710
But, you know, we have lobbied
for... that it be a GST rebate on

493
00:15:36,710 --> 00:15:38,130
all new homes under a million
dollars.

494
00:15:38,130 --> 00:15:41,490
Because for the first time home
buyer, it's one thing, but it's

495
00:15:41,490 --> 00:15:43,310
like to say you've got two people
or two apartments and they've come

496
00:15:43,310 --> 00:15:43,410
together.

497
00:15:43,410 --> 00:15:44,810
Well, they're not first time home

498
00:15:44,810 --> 00:15:48,080
buyers now, but they want to buy
something bigger and it doesn't

499
00:15:48,080 --> 00:15:50,460
allow them to move out of or move
out their housing continuum.

500
00:15:50,460 --> 00:15:51,740
Taylor and I have been talking a
lot about it.

501
00:15:51,740 --> 00:15:53,460
It should be for all principal
residences under a million.

502
00:15:52,400 --> 00:15:54,680
It makes sense to GST investors, I
guess, but like... I agree.

503
00:15:54,680 --> 00:15:55,160
It Yeah.

504
00:15:55,160 --> 00:15:55,740
I mean, can you give us some

505
00:15:55,760 --> 00:15:55,160
insight on some of the
conversations you're having at

506
00:15:55,160 --> 00:15:55,740
government level?
Like what suggestions or solutions

507
00:15:55,760 --> 00:15:56,800
are you guys discussing with them
or urging?

508
00:15:56,800 --> 00:15:58,800
Well, there's a number, both at
the municipal level and at the

509
00:15:58,800 --> 00:15:58,900
provincial level.

510
00:15:58,900 --> 00:16:00,160
So one of the ones that is a

511
00:16:00,160 --> 00:16:03,040
really big one is in building,
you're required to have a certain

512
00:16:03,040 --> 00:16:03,240
percentage.

513
00:16:03,240 --> 00:16:04,580
In fact, it's 20 % of below market

514
00:16:04,580 --> 00:16:05,540
rental units in a building.

515
00:16:05,540 --> 00:16:07,080
So the new renter is subsidizing

516
00:15:58,220 --> 00:15:59,120
essentially 20 % of inclusionary
zoning in a building.

517
00:15:59,120 --> 00:16:08,760
And at this stage, when the
builder can't even afford to build

518
00:16:08,760 --> 00:16:09,880
at what the going rents are.

519
00:16:10,040 --> 00:16:10,840
to lower that.

520
00:16:10,840 --> 00:16:12,500
We can even lower it to 5%.

521
00:16:12,500 --> 00:16:13,760
And it sounds like a great idea,

522
00:16:13,800 --> 00:16:17,940
but when the cost of delivering a
unit is more than what the average

523
00:16:17,940 --> 00:16:21,700
person can pay in rent, and then
you've got to further add more

524
00:16:21,940 --> 00:16:23,460
costs because you've got to now
subsidize 20%.

525
00:16:23,460 --> 00:16:24,300
So that's a big one.

526
00:16:24,300 --> 00:16:26,080
You know, I don't want to put any

527
00:16:26,160 --> 00:16:26,600
sort of subjectivity on.

528
00:16:26,600 --> 00:16:27,240
Sir, inclusionary zoning sounds

529
00:16:27,240 --> 00:16:27,340
great.

530
00:16:27,340 --> 00:16:28,340
Let's have all the high rent

531
00:16:28,340 --> 00:16:29,500
people pay for the low rent
people.

532
00:16:29,500 --> 00:16:29,740
Great.

533
00:16:29,740 --> 00:16:30,820
But if the money's not there,

534
00:16:30,820 --> 00:16:33,120
again, if you don't have the $5 to
loan, then we're not going to get

535
00:16:33,120 --> 00:16:33,760
anything built.

536
00:16:33,760 --> 00:16:37,440
And so the next thing I want to

537
00:16:37,440 --> 00:16:41,050
just talk about is the rapidly
advancing green building

538
00:16:41,050 --> 00:16:41,270
standards.

539
00:16:36,480 --> 00:16:42,290
Again, I'm not putting any

540
00:16:42,290 --> 00:16:44,390
subjectivity to it, but it adds an
enormous amount of cost.

541
00:16:44,390 --> 00:16:47,050
So we're talking to the provincial
government about that extensively.

542
00:16:47,050 --> 00:16:51,860
So when you look at green building
initiatives or what they call the

543
00:16:51,860 --> 00:16:54,140
step code three, the new building
code, it's adding upwards.

544
00:16:54,140 --> 00:16:56,220
$50 ,000 to $60 ,000 a door.

545
00:16:56,220 --> 00:16:57,840
And the savings to the home buyer

546
00:16:57,840 --> 00:17:01,000
or the homeowner is about $5 ,000
to $10 a month.

547
00:17:01,000 --> 00:17:04,380
Now, you could argue that it's
saving things and embodied carbon

548
00:17:04,380 --> 00:17:05,260
and those sort of things.

549
00:17:05,260 --> 00:17:09,460
But we say, look, we need to do a

550
00:17:09,460 --> 00:17:09,920
cost -benefit analysis.

551
00:17:10,099 --> 00:17:11,060
What is this costing?

552
00:17:11,280 --> 00:17:13,819
And what is the benefit?
And as a society, that's what

553
00:17:13,819 --> 00:17:14,579
we're calling for.

554
00:17:14,579 --> 00:17:16,450
Well, then there's got to be

555
00:17:16,450 --> 00:17:18,349
offsets, whether it's the auto
industry or other industries,

556
00:17:18,349 --> 00:17:19,910
whether it's government subsidies
or tax -free.

557
00:17:19,910 --> 00:17:22,349
You keep adding and adding and
adding, you know, whether it's

558
00:17:22,349 --> 00:17:24,750
triple glazing the windows and it
sort of goes on and on are the

559
00:17:24,750 --> 00:17:26,730
building requirements that are in
place now.

560
00:17:26,730 --> 00:17:30,490
The buildings that were around,
you know, that built 15 years ago

561
00:17:30,590 --> 00:17:30,790
don't have those.

562
00:17:30,790 --> 00:17:31,330
you could have those.

563
00:17:31,330 --> 00:17:34,890
So are they less safe or are they
less green?

564
00:17:34,890 --> 00:17:37,310
You know, so I think that when we
bring in these initiatives, we

565
00:17:37,490 --> 00:17:39,710
really need to be mindful of what
the costs are.

566
00:17:39,710 --> 00:17:41,110
So we're adding $100 ,000 a door.

567
00:17:41,410 --> 00:17:42,010
What benefit are we getting?

568
00:17:42,010 --> 00:17:44,570
So the provincial government and
the environment minister have

569
00:17:44,570 --> 00:17:45,670
agreed, yes, let's look at this.

570
00:17:45,670 --> 00:17:48,570
Let's examine this, what is really

571
00:17:48,570 --> 00:17:51,590
required and where can we perhaps
lower the cost.

572
00:17:51,590 --> 00:17:53,850
You know, it's the mandatory
electrification buildings, no use

573
00:17:53,850 --> 00:17:56,410
of natural gas, you know, EV
charging stations, saving existing

574
00:17:56,410 --> 00:17:56,650
trees.

575
00:17:56,650 --> 00:17:59,030
So then we have to change the

576
00:17:59,030 --> 00:18:01,450
routing of the parking lot or the
driveway and all that.

577
00:18:01,630 --> 00:18:05,380
Then that adds more carbon from
concrete and things.

578
00:18:05,380 --> 00:18:10,480
So then we've got to pay for that
because we've added more carbon,

579
00:18:10,480 --> 00:18:13,040
but it's because of a requirement
to save one tree.

580
00:18:13,040 --> 00:18:16,300
So again, I don't have to say
whether these things are good or

581
00:18:16,300 --> 00:18:16,660
bad.

582
00:18:16,660 --> 00:18:17,940
My job is to say whether the

583
00:18:17,940 --> 00:18:20,820
impact and the cost it has on
housing and that delivery of

584
00:18:21,080 --> 00:18:21,420
housing.

585
00:18:21,420 --> 00:18:23,200
It's their job to figure out

586
00:18:23,200 --> 00:18:26,540
whether this is necessary for the
environment or not.

587
00:18:26,540 --> 00:18:29,720
And if it is, at what cost?
If it's costing so much that we're

588
00:18:29,720 --> 00:18:32,840
not getting housing built, that's
what we need to think about.

589
00:18:32,840 --> 00:18:37,600
And the new building code as well
is requiring the 20 % of units be

590
00:18:37,600 --> 00:18:37,920
adaptable.

591
00:18:37,920 --> 00:18:39,100
Again, that adds cost.

592
00:18:39,100 --> 00:18:40,300
And often they don't get rented or
purchased.

593
00:18:40,300 --> 00:18:43,320
So then you're holding them for
when somebody may or may not.

594
00:18:43,320 --> 00:18:43,980
want those units.

595
00:18:43,980 --> 00:18:45,140
So when you have an adaptable

596
00:18:45,140 --> 00:18:46,280
unit, it has to be bigger.

597
00:18:46,280 --> 00:18:48,300
There's all the changes to it that

598
00:18:48,300 --> 00:18:49,820
you can imagine that go into that.

599
00:18:49,820 --> 00:18:51,580
And when 20 % of them have to be,

600
00:18:51,580 --> 00:18:52,520
you're adding costs.

601
00:18:52,520 --> 00:18:53,980
Those are the three sort of big

602
00:18:53,980 --> 00:18:55,100
ones that we're talking about.

603
00:18:55,100 --> 00:18:57,640
I could rattle up a whole bunch

604
00:18:57,640 --> 00:18:57,860
more.

605
00:18:58,080 --> 00:18:59,600
Like in the city of Vancouver,

606
00:18:59,600 --> 00:19:02,270
there's a public art fee of a
million dollars a building.

607
00:19:02,270 --> 00:19:04,530
I saw that in one of your emails.

608
00:19:04,530 --> 00:19:06,170
What is the public art fee?

609
00:19:06,330 --> 00:19:11,550
You pay a million dollars to the
city towards public art, or you

610
00:19:11,810 --> 00:19:15,390
can put... A million dollar art
installation in your building, one

611
00:19:15,390 --> 00:19:15,830
or the other.

612
00:19:15,830 --> 00:19:17,310
Most developers will choose to do

613
00:19:17,310 --> 00:19:19,810
it themselves just because, I
don't know, I want to have some

614
00:19:19,810 --> 00:19:20,470
control.

615
00:19:20,470 --> 00:19:22,230
Like affordable housing, 20 % of

616
00:19:22,230 --> 00:19:25,070
these places have to be under
rent, but you need to pay a

617
00:19:25,070 --> 00:19:26,070
million dollars for a statue.

618
00:19:26,070 --> 00:19:26,230
Yeah.

619
00:19:26,230 --> 00:19:28,090
What's going on with that?
Yeah, who came up with that?

620
00:19:28,090 --> 00:19:29,990
Like, when was that implemented?
Like, I don't understand.

621
00:19:29,990 --> 00:19:31,750
It's got to get passed, right?
Quite a while ago.

622
00:19:31,750 --> 00:19:32,350
a while ago.

623
00:19:32,350 --> 00:19:32,670
Yeah.

624
00:19:32,670 --> 00:19:35,690
You know, and then saying, OK,
well, we're going to reduce

625
00:19:35,690 --> 00:19:38,490
parking, but you have to now give
everybody a bus path.

626
00:19:38,490 --> 00:19:41,250
Well, if they're going to go into
this building, then they probably

627
00:19:41,250 --> 00:19:41,810
don't have a car.

628
00:19:41,810 --> 00:19:43,170
So why is it our responsibility to

629
00:19:43,170 --> 00:19:45,450
give them a bus path?
At like the developer level, like

630
00:19:45,450 --> 00:19:47,110
is there feedback?
You know what?

631
00:19:47,110 --> 00:19:51,350
Like we're just going to put
things on pause or are they

632
00:19:51,350 --> 00:19:54,370
leaving to Alberta or the states?
Like what are developers doing

633
00:19:54,370 --> 00:19:55,630
right now if it just doesn't
pencil?

634
00:19:55,630 --> 00:19:56,840
Well, of the above.

635
00:19:56,840 --> 00:19:58,220
So pre -sale projects, wood frame,

636
00:19:58,220 --> 00:20:00,740
concrete townhomes are tracking
well below pace of sales, which is

637
00:20:00,740 --> 00:20:02,360
needed to get to the 70 % pre
-sale threshold.

638
00:20:02,360 --> 00:20:03,460
And some projects are just on
pause.

639
00:20:03,460 --> 00:20:04,080
Many projects are on pause.

640
00:20:04,160 --> 00:20:05,680
In Kelowna, most are on pause.

641
00:20:05,680 --> 00:20:07,380
I don't know if there's any new
ones coming for sale.

642
00:20:07,380 --> 00:20:09,000
It's a tough one right now for the
pre -sales.

643
00:20:09,000 --> 00:20:10,960
Building permits in Metro
Vancouver and I think around the

644
00:20:10,960 --> 00:20:11,980
province have dropped by about
10%.

645
00:20:11,980 --> 00:20:13,780
Some of them have actually
experienced declines of 40 % and

646
00:20:13,780 --> 00:20:14,660
even as high as 85%.

647
00:20:14,980 --> 00:20:17,040
permits in Metro Vancouver and I

648
00:20:17,040 --> 00:20:19,840
think around the province have
dropped by about 10%.

649
00:20:19,840 --> 00:20:23,210
Some of them have actually
experienced declines of 40 % and

650
00:20:23,210 --> 00:20:24,370
even as high as 85%.

651
00:20:24,370 --> 00:20:25,930
In your opinion, do you think this

652
00:20:25,930 --> 00:20:29,690
is going to actually raise prices
in the next five years because of

653
00:20:29,690 --> 00:20:31,330
all this slowdown?
That's the sad part.

654
00:20:31,330 --> 00:20:31,670
the sad part.

655
00:20:31,670 --> 00:20:33,310
There's only 20 % of the people

656
00:20:33,310 --> 00:20:34,110
that can afford it.

657
00:20:34,110 --> 00:20:36,290
And if there's less supply, so

658
00:20:36,290 --> 00:20:38,470
then that 20 % will then be
competing for that short supply.

659
00:20:38,470 --> 00:20:40,230
So then the prices will go up.

660
00:20:40,230 --> 00:20:41,650
And then you're creating a bigger

661
00:20:41,650 --> 00:20:42,950
delta between what's available and
what's for sale.

662
00:20:43,210 --> 00:20:43,430
Yeah.

663
00:20:43,430 --> 00:20:44,710
I mean, you cure it frequently

664
00:20:44,850 --> 00:20:46,390
from a small amount of the
population that's... probably

665
00:20:46,390 --> 00:20:48,850
hoping that the market's going to
crash, but they're like, you know,

666
00:20:48,850 --> 00:20:49,250
it's not sustainable.

667
00:20:49,250 --> 00:20:50,430
These prices aren't affordable.

668
00:20:50,430 --> 00:20:51,390
Like it's going to crash.

669
00:20:51,590 --> 00:20:53,090
And you're like, yeah, I see where

670
00:20:53,090 --> 00:20:53,350
you're coming from.

671
00:20:53,350 --> 00:20:54,430
However, like supply and demand

672
00:20:54,430 --> 00:20:56,010
would argue that point.

673
00:20:56,010 --> 00:20:57,570
Well, I think that it's not going

674
00:20:57,570 --> 00:20:57,810
to crash.

675
00:20:57,810 --> 00:20:59,150
What is crashing is our ability to

676
00:20:59,150 --> 00:20:59,270
build.

677
00:20:59,270 --> 00:21:01,410
So it's not that the prices are

678
00:21:01,410 --> 00:21:03,830
going to come way, way down
because the cost of delivery

679
00:21:03,830 --> 00:21:05,170
hasn't come way, way down.

680
00:21:05,390 --> 00:21:07,750
So you're not going to flood the

681
00:21:07,750 --> 00:21:09,390
market and lose money.

682
00:21:09,390 --> 00:21:11,370
Why would you do that?

683
00:21:11,370 --> 00:21:14,390
Why would you build a bunch of
buildings when it's costing you $1

684
00:21:14,390 --> 00:21:17,870
,000 a square foot to build, but
people can only afford $1 ,850 a

685
00:21:18,170 --> 00:21:19,570
square foot?
So it doesn't make sense.

686
00:21:19,570 --> 00:21:20,670
It's not the market's crashing,
the industry's crashing.

687
00:21:20,670 --> 00:21:23,050
So are prices going to come off a
little bit?

688
00:21:23,050 --> 00:21:23,150
Sure.

689
00:21:23,150 --> 00:21:24,850
Because with rent, the prices are

690
00:21:24,850 --> 00:21:27,250
coming off for sure because
buildings got built and they need

691
00:21:27,250 --> 00:21:28,730
to be rented.

692
00:21:28,730 --> 00:21:30,470
And so developers or builders are

693
00:21:30,470 --> 00:21:31,870
renting at a loss.

694
00:21:31,870 --> 00:21:24,590
And over time, the value of that

695
00:21:24,590 --> 00:21:27,470
building will go up and the equity
in it will be paid down.

696
00:21:27,470 --> 00:21:30,590
And rents will go up a little bit
each year.

697
00:21:30,590 --> 00:21:34,520
So over time, if you're building a
building and you need to collect

698
00:21:34,520 --> 00:21:38,120
$5 or $6 a square foot for rent to
cover your costs, you're not doing

699
00:21:38,120 --> 00:21:38,660
that very often.

700
00:21:38,660 --> 00:21:40,440
Rents is sort of as a $3 .50 to $4

701
00:21:40,440 --> 00:21:41,100
.50 a square foot.

702
00:21:41,100 --> 00:21:42,880
I mean, it's obvious people would

703
00:21:43,000 --> 00:21:45,520
pay less than that, but you're
getting up there at that price.

704
00:21:45,520 --> 00:21:49,180
If you think it's $5 a square foot
and you're living in a thousand

705
00:21:49,180 --> 00:21:50,700
per feet, you're paying $5 ,000.

706
00:21:50,700 --> 00:21:53,480
But they can't come down that

707
00:21:53,480 --> 00:21:53,720
much.

708
00:21:53,720 --> 00:21:55,380
And it's so much based on income.

709
00:21:55,380 --> 00:22:00,010
Like I said, when there was room
in the market, when you could

710
00:22:00,010 --> 00:22:02,410
build for $350 a square foot and
incomes were at that $100 ,000

711
00:22:02,410 --> 00:22:03,830
level, there was a room.

712
00:22:03,830 --> 00:22:04,890
And so governments just kept

713
00:22:04,890 --> 00:22:05,370
adding costs.

714
00:22:05,370 --> 00:22:07,130
And frankly, in a way, seeing the

715
00:22:07,130 --> 00:22:10,810
industry like an ATM just kept
taking and taking.

716
00:22:10,810 --> 00:22:12,510
And we said, there's a limit here.

717
00:22:12,510 --> 00:22:13,230
There's a limit.

718
00:22:13,230 --> 00:22:14,270
We've reached the limit.

719
00:22:14,270 --> 00:22:15,830
Oh, no, you haven't.

720
00:22:15,830 --> 00:22:17,410
You keep on building.

721
00:22:17,410 --> 00:22:18,630
You say that all the time.

722
00:22:18,630 --> 00:22:19,130
I'm warning you.

723
00:22:19,230 --> 00:22:19,890
There's a limit.

724
00:22:19,890 --> 00:22:21,130
Here are the incomes.

725
00:22:21,130 --> 00:22:22,290
Here are the costs.

726
00:22:22,290 --> 00:22:25,290
Many of them are like, oh, I see.

727
00:22:25,290 --> 00:22:27,680
OK, so how do we reduce costs?

728
00:22:27,680 --> 00:22:28,760
Or governments lower income tax.

729
00:22:28,760 --> 00:22:30,940
Interest rates can come down a bit

730
00:22:30,940 --> 00:22:32,940
more, whether they will or not.

731
00:22:32,940 --> 00:22:33,840
I don't know.

732
00:22:34,000 --> 00:22:36,220
Income tax is going to come down.

733
00:22:36,220 --> 00:22:37,180
I don't know.

734
00:22:37,340 --> 00:22:38,900
PST going to come down.

735
00:22:39,060 --> 00:22:39,960
I don't think so.

736
00:22:39,960 --> 00:22:44,780
So unless you have more money in
your jeans or more money in the

737
00:22:44,780 --> 00:22:49,360
bank or more money coming in every
month, salaries are going to tick

738
00:22:49,360 --> 00:22:51,340
up a little bit each year.

739
00:22:51,340 --> 00:22:53,100
You know, the cost of living

740
00:22:53,100 --> 00:22:57,300
allowance are going to go up 2 %
per year, your salaries.

741
00:22:57,320 --> 00:23:02,320
And can costs come off 2 % or 3%,
3 % or 4 % over the next couple of

742
00:23:02,320 --> 00:23:03,360
years?
Then maybe there's some room for

743
00:23:03,360 --> 00:23:07,000
some profit that you have to
demonstrate to the banks that you

744
00:23:07,000 --> 00:23:09,240
can realize a profit, then you
will get financing.

745
00:23:09,240 --> 00:23:12,580
But you can't get financing from
the bank unless you can

746
00:23:12,580 --> 00:23:14,460
demonstrate that a project is
going to be profitable.

747
00:23:14,460 --> 00:23:16,720
Banks are not in the business of
losing your money or my money.

748
00:23:16,720 --> 00:23:19,300
You know, they're not going to
loan you that money if they think

749
00:23:19,300 --> 00:23:20,480
that you're going to go
underwater.

750
00:23:21,660 --> 00:23:24,620
The salary is an interesting one
to me because, yeah, it does make

751
00:23:24,620 --> 00:23:24,900
more sense.

752
00:23:24,900 --> 00:23:26,760
Like people do need to earn more

753
00:23:26,760 --> 00:23:27,880
money compared to the expenses we
have.

754
00:23:27,940 --> 00:23:28,800
But where does the salary come
from?

755
00:23:28,800 --> 00:23:31,520
Like, I feel like in Kelowna, we
have a lot of small businesses,

756
00:23:31,520 --> 00:23:31,720
entrepreneurs.

757
00:23:31,720 --> 00:23:34,900
So, you know, if a store down the

758
00:23:34,900 --> 00:23:37,540
street needs to pay their employee
four bucks an hour more.

759
00:23:37,540 --> 00:23:40,340
Well, who owns that store?
You know, that's a direct expense

760
00:23:40,480 --> 00:23:40,620
to them.

761
00:23:40,620 --> 00:23:42,200
So we're just kind of like chasing

762
00:23:42,200 --> 00:23:43,420
our tail in that scenario.

763
00:23:43,580 --> 00:23:44,340
Well, that's how inflation...

764
00:23:44,340 --> 00:23:46,900
Kind of works as everything gets
more expensive, then wages have to

765
00:23:47,000 --> 00:23:48,820
go up, then things get more
expensive, then wages go up.

766
00:23:48,820 --> 00:23:50,400
And it's just kind of, yeah,
exactly.

767
00:23:50,580 --> 00:23:52,970
Or can you lower income tax?
can you lower income tax?

768
00:23:52,970 --> 00:23:54,850
But then that's less money for the
government.

769
00:23:55,610 --> 00:23:59,790
And the government needs to look
at their spending and how they

770
00:23:59,790 --> 00:24:00,250
spend.

771
00:24:00,250 --> 00:24:02,250
And are they spending way more of

772
00:24:02,250 --> 00:24:03,390
our money than they should be?
Everything's connected.

773
00:24:03,390 --> 00:24:06,410
Yeah, to me, that one is like
staring us right in the face.

774
00:24:06,410 --> 00:24:08,670
Like the spending needs to be
under control a little bit.

775
00:24:08,670 --> 00:24:10,830
Like that seems like the easiest
part of this.

776
00:24:10,830 --> 00:24:12,770
But I guess when was the writing
on the wall?

777
00:24:12,770 --> 00:24:15,330
Like hindsight, what year was this
kind of developing where people

778
00:24:15,330 --> 00:24:17,010
were like, okay, this is a serious
problem.

779
00:24:17,350 --> 00:24:18,930
Like it seems like we've been
talking about it forever.

780
00:24:18,930 --> 00:24:23,060
Two years ago, years ago, two and
a half years ago, when we started

781
00:24:23,060 --> 00:24:25,940
saying, look, incomes are at this
level and it's now costing us this

782
00:24:25,940 --> 00:24:26,380
to build.

783
00:24:26,380 --> 00:24:29,480
And it was two or three years ago

784
00:24:29,480 --> 00:24:31,900
when projects had been launched or
sales had been started and

785
00:24:31,900 --> 00:24:35,800
construction costs during COVID
started to go up like this.

786
00:24:35,800 --> 00:24:38,580
And those buildings, they sold at
this level, you know, 2021 level,

787
00:24:38,580 --> 00:24:40,280
and they're building at 2023
prices and it doesn't work.

788
00:24:40,280 --> 00:24:42,740
And so we've seen foreclosures,
seen companies go under.

789
00:24:42,740 --> 00:24:43,760
You've probably heard about the
foreclosures.

790
00:24:43,760 --> 00:24:44,980
There's been buildings that aren't
getting finished, buildings that

791
00:24:44,980 --> 00:24:46,720
aren't going ahead, buildings that
have started, maybe digging a hole

792
00:24:46,720 --> 00:24:47,160
and it's stopped.

793
00:24:47,300 --> 00:24:48,880
And people say, oh, I see cranes

794
00:24:48,880 --> 00:24:49,700
in the air.

795
00:24:49,740 --> 00:24:50,880
Well, yeah, those were cranes of

796
00:24:50,880 --> 00:24:53,400
projects that were sold, you know,
three years ago, let's say.

797
00:24:53,400 --> 00:24:56,060
And then they got their building
permit and then they started

798
00:24:56,180 --> 00:24:56,300
construction.

799
00:24:56,300 --> 00:24:57,940
And those projects may or may not

800
00:24:57,940 --> 00:24:58,340
be underwater depending.

801
00:24:58,340 --> 00:25:00,600
on what they sold for and what

802
00:25:00,600 --> 00:25:02,020
contracts that they had in place
for construction costs.

803
00:25:02,020 --> 00:25:06,450
So the ones that are midway, the
big companies are able to hold on.

804
00:25:06,450 --> 00:25:08,610
One developer I know well,
speaking with him last week, he

805
00:25:08,610 --> 00:25:11,610
said 25 to 30 % of people are not
closing on the project.

806
00:25:11,610 --> 00:25:14,090
So he's going to have 30 % of his
units.

807
00:25:14,090 --> 00:25:15,850
He's going to have to pay GST on
those.

808
00:25:15,850 --> 00:25:17,690
You know, he's going to get the
deposit back, but the deposit's a

809
00:25:17,910 --> 00:25:19,490
fraction of what it cost him.

810
00:25:19,490 --> 00:25:20,250
And he's going to try to sell them

811
00:25:20,250 --> 00:25:20,670
in this market.

812
00:25:20,670 --> 00:25:21,590
And people just can't afford that

813
00:25:21,590 --> 00:25:22,470
because interest rates went up.

814
00:25:22,470 --> 00:25:23,290
They lost their job.

815
00:25:23,290 --> 00:25:25,110
And so people are backing out on
their purchases.

816
00:25:25,110 --> 00:25:25,770
We're seeing that as well.

817
00:25:25,770 --> 00:25:28,670
I guess, like, is there a light at

818
00:25:28,670 --> 00:25:30,970
the end of the tunnel?
I don't want to fully blame the

819
00:25:30,970 --> 00:25:31,350
government.

820
00:25:31,350 --> 00:25:32,990
I know that's not what we're doing

821
00:25:32,990 --> 00:25:33,170
here.

822
00:25:33,290 --> 00:25:34,610
But like, obviously, you know, we

823
00:25:34,610 --> 00:25:36,450
kind of went through COVID.

824
00:25:36,450 --> 00:25:37,430
We went through, like,

825
00:25:37,430 --> 00:25:37,630
essentially.

826
00:25:37,630 --> 00:25:38,290
Getting close to hyperinflation,

827
00:25:38,290 --> 00:25:42,750
like, you know, some of the things
were kind of out of their hands,

828
00:25:42,890 --> 00:25:43,370
obviously, globally.

829
00:25:43,370 --> 00:25:44,990
Are there some solutions that are

830
00:25:44,990 --> 00:25:46,670
being implemented where it's
alleviating some of this pain?

831
00:25:46,670 --> 00:25:48,010
And, you know, you guys in your
organization or developers are

832
00:25:48,190 --> 00:25:51,410
going, yeah, if we hang tight for
the next couple of years, like we

833
00:25:51,410 --> 00:25:54,390
feel there's some optimism at the
end of this.

834
00:25:54,390 --> 00:25:57,910
Well, I think what I would say is
that we are working extremely hard

835
00:25:57,910 --> 00:26:00,890
over the next year, 18 months to
make substantial changes.

836
00:26:00,890 --> 00:26:02,790
Am I optimistic?
I have to be.

837
00:26:02,790 --> 00:26:07,970
I have to be optimistic that we
will get change and that all of us

838
00:26:07,970 --> 00:26:13,410
pulling together, that our
companies and our employees and

839
00:26:13,410 --> 00:26:17,250
everybody is speaking with the
government, doing the research,

840
00:26:17,250 --> 00:26:19,810
getting the information, sitting
down with regulators saying, this

841
00:26:19,810 --> 00:26:21,270
is what we can do.

842
00:26:21,270 --> 00:26:23,310
So yes, I think there will be, but

843
00:26:23,330 --> 00:26:24,490
it's going to take time.

844
00:26:24,490 --> 00:26:26,370
It's going to take a year to 18

845
00:26:26,370 --> 00:26:26,690
months.

846
00:26:26,690 --> 00:26:28,050
Like I said, the DCC change is not

847
00:26:28,050 --> 00:26:30,330
going to be in effect right away.

848
00:26:30,830 --> 00:26:33,210
It takes a bit of time for it to

849
00:26:33,210 --> 00:26:33,690
be implemented.

850
00:26:33,690 --> 00:26:36,830
So the light at the end of the...

851
00:26:36,830 --> 00:26:40,860
tunnel is that we do get some
substantial massive changes in

852
00:26:40,860 --> 00:26:44,380
policy that income levels do go up
by cost of living and that

853
00:26:44,380 --> 00:26:46,720
interest rates perhaps come down a
bit.

854
00:26:46,720 --> 00:26:48,920
That's the only thing that we've
got.

855
00:26:48,920 --> 00:26:51,880
That's probably two years before
there's any substantial feeling of

856
00:26:52,020 --> 00:26:54,060
relief for projects to say, okay,
we got this.

857
00:26:54,060 --> 00:26:55,580
It's going to take time.

858
00:26:55,580 --> 00:26:58,280
But this is also a year of a

859
00:26:58,280 --> 00:26:58,760
massive slowdown this year.

860
00:26:58,760 --> 00:27:00,080
So then you've got to catch up.

861
00:27:00,080 --> 00:27:01,860
And people say, well, where is
everybody living?

862
00:27:01,860 --> 00:27:03,300
Well, they're living with
roommates and in basement suites.

863
00:27:03,420 --> 00:27:05,060
And there's couples living with
other couples and people staying

864
00:27:05,060 --> 00:27:06,800
at home, living at home longer,
moving away from Vancouver, moving

865
00:27:06,800 --> 00:27:07,740
away from BC.

866
00:27:07,740 --> 00:27:09,040
Yeah, we're seeing a population

867
00:27:09,040 --> 00:27:10,260
decline in BC, which is crazy.

868
00:27:10,260 --> 00:27:12,020
And so when you have a population

869
00:27:12,020 --> 00:27:14,320
decline, you have less people
paying income tax.

870
00:27:14,320 --> 00:27:15,320
You're building less homes.

871
00:27:15,320 --> 00:27:16,660
You've got less people paying

872
00:27:16,660 --> 00:27:16,940
property tax.

873
00:27:16,940 --> 00:27:17,800
Property transfer tax alone is, I

874
00:27:17,800 --> 00:27:19,680
think, I'd have to go back and
look.

875
00:27:19,860 --> 00:27:20,600
I should have had that stat.

876
00:27:20,600 --> 00:27:22,960
But I think it was at one point as

877
00:27:22,960 --> 00:27:27,180
high as $3 billion that they would
receive in property transfer tax.

878
00:27:27,180 --> 00:27:28,520
Well, they're not going to get
that.

879
00:27:28,520 --> 00:27:29,500
They're going to get probably half
that.

880
00:27:29,500 --> 00:27:31,680
So that's a huge hole in the
government budget.

881
00:27:31,680 --> 00:27:35,000
And then if there's a slowdown in
construction, if construction's at

882
00:27:35,000 --> 00:27:37,760
30 % in Kelowna or Vancouver or
wherever, then those are job

883
00:27:37,760 --> 00:27:38,020
losses.

884
00:27:38,020 --> 00:27:39,780
And that's less income tax being

885
00:27:39,780 --> 00:27:40,000
paid.

886
00:27:40,000 --> 00:27:40,840
And that's less product being

887
00:27:40,840 --> 00:27:40,960
paid.

888
00:27:40,960 --> 00:27:42,460
And that's less people working.

889
00:27:42,460 --> 00:27:43,620
It's a cascading.

890
00:27:43,620 --> 00:27:45,760
I don't have to explain it to you

891
00:27:45,760 --> 00:27:46,580
or your viewers.

892
00:27:46,580 --> 00:27:48,480
We all know what happens.

893
00:27:48,480 --> 00:27:51,980
We think, oh, well, the
developers, no, they're just not

894
00:27:51,980 --> 00:27:52,960
getting rich.

895
00:27:52,960 --> 00:27:56,040
That's not the point.

896
00:27:56,060 --> 00:27:59,740
The developers will figure out
where to go and build or they just

897
00:27:59,740 --> 00:28:00,400
won't build.

898
00:28:00,400 --> 00:28:02,480
But what does that mean to you and

899
00:28:02,480 --> 00:28:05,520
me and our families and children
and people with jobs in the

900
00:28:05,520 --> 00:28:06,720
construction sector or engineering
or architects?

901
00:28:06,720 --> 00:28:09,080
It's hard to turn it around.

902
00:28:09,080 --> 00:28:09,280
Yeah.

903
00:28:09,440 --> 00:28:11,280
With property transfer tax, I'm
curious, have you heard any

904
00:28:11,280 --> 00:28:13,480
Rimbling?
Like, do we need it in BC?

905
00:28:13,480 --> 00:28:16,100
Obviously it's BC and Ontario, but
like - Two or $3 billion.

906
00:28:16,100 --> 00:28:18,600
I know, but like, is that not
something we can take away?

907
00:28:18,600 --> 00:28:19,820
Well, I don't disagree with you.

908
00:28:19,820 --> 00:28:20,860
However, it goes back to, can the

909
00:28:20,860 --> 00:28:22,980
government reduce their costs by a
billion dollars?

910
00:28:22,980 --> 00:28:25,460
Maybe we wouldn't need the
property transfer tax or maybe

911
00:28:25,460 --> 00:28:29,600
that could be lowered, but they
rely on it.

912
00:28:29,600 --> 00:28:32,500
It's a cash cow, right?
You know, you get GST on new

913
00:28:32,500 --> 00:28:32,880
homes.

914
00:28:32,880 --> 00:28:34,100
There's a property transfer tax.

915
00:28:34,100 --> 00:28:36,700
It's incredible the amount of
taxation that's put on housing.

916
00:28:36,700 --> 00:28:37,000
Yeah.

917
00:28:37,000 --> 00:28:40,720
And people don't see it because

918
00:28:40,720 --> 00:28:42,280
people could afford something,
right?

919
00:28:42,280 --> 00:28:45,300
But now it's even hard to afford,
you know, an 800 square foot condo

920
00:28:45,300 --> 00:28:48,380
in Kelowna or Victoria and the
markets, you know, and the cost of

921
00:28:48,380 --> 00:28:49,940
construction probably is more
expensive in Kelowna than in the

922
00:28:49,980 --> 00:28:50,240
lower mainland.

923
00:28:50,240 --> 00:28:51,440
What about something like the

924
00:28:51,440 --> 00:28:54,300
foreign buyer's ban?
When I look at this and I think

925
00:28:54,300 --> 00:28:56,780
about what the beefing right now
with the U .S.

926
00:28:57,000 --> 00:29:00,040
and what's happening, it feels
like it's a massive opportunity

927
00:29:00,040 --> 00:29:04,140
for us to brain drain the USA, but
they're not allowed to come here

928
00:29:04,140 --> 00:29:05,520
and buy a house.

929
00:29:05,520 --> 00:29:07,060
It just doesn't make any sense to

930
00:29:07,060 --> 00:29:08,780
me, at least from south of the
border.

931
00:29:08,780 --> 00:29:12,590
I don't know about East or West,
but what's your opinion on this?

932
00:29:12,590 --> 00:29:14,090
We've been opposed to foreign
buyers tax since Christy Clark

933
00:29:14,090 --> 00:29:14,970
brought it in all those years ago.

934
00:29:14,970 --> 00:29:15,690
It doesn't do anything.

935
00:29:15,690 --> 00:29:18,290
First of all, in our opinion, it
was a racist thing to do because

936
00:29:18,290 --> 00:29:22,010
they were seeing certain people
buying up these big single family

937
00:29:22,010 --> 00:29:23,110
homes on the West side of
Vancouver.

938
00:29:23,110 --> 00:29:23,250
Yeah.

939
00:29:23,250 --> 00:29:23,850
It's ridiculous.

940
00:29:24,030 --> 00:29:24,970
It didn't help.

941
00:29:24,970 --> 00:29:26,030
In fact, it hindered.

942
00:29:26,030 --> 00:29:27,350
None of these taxes helped.

943
00:29:27,350 --> 00:29:28,390
We warned them.

944
00:29:28,390 --> 00:29:32,310
You add on all these taxes,
whether it's foreign buyers tax,

945
00:29:32,310 --> 00:29:34,250
speculation tax, additional school
tax.

946
00:29:34,250 --> 00:29:35,670
You can't tax your way to
affordability.

947
00:29:35,670 --> 00:29:38,450
And we told them, you're just
going to raise prices because it's

948
00:29:38,940 --> 00:29:39,780
going to limit supply.

949
00:29:39,780 --> 00:29:40,180
Yeah.

950
00:29:40,340 --> 00:29:42,240
But with the foreign buyers tax or
the foreign buyers ban.

951
00:29:42,240 --> 00:29:43,760
with the foreign buyers tax or the
foreign buyers ban.

952
00:29:43,880 --> 00:29:44,560
Yeah, Yeah, it's a ban.

953
00:29:44,560 --> 00:29:45,640
It's not even a tax.

954
00:29:45,640 --> 00:29:46,680
It's a ban.

955
00:29:46,680 --> 00:29:47,400
It's access to equity.

956
00:29:47,400 --> 00:29:48,160
access to equity.

957
00:29:48,160 --> 00:29:49,380
Why are we banning equity in the

958
00:29:49,380 --> 00:29:51,360
development of housing?
It's a huge risk to develop.

959
00:29:51,360 --> 00:29:55,460
we a tall building or a building,
you know, you build a single

960
00:29:55,460 --> 00:29:59,100
family home, it's a risk, but
think about the tens of millions

961
00:29:59,100 --> 00:30:01,540
of dollars that go into a
multifamily development.

962
00:30:01,540 --> 00:30:04,800
And if we're only allowed to use
Canadian money, and it's just

963
00:30:04,920 --> 00:30:07,260
Canadian money swirling around,
you know, we need to have an

964
00:30:07,260 --> 00:30:09,720
influx of an investment in our
country, an investment in our

965
00:30:09,820 --> 00:30:11,340
industries, you know, an
investment, whether it's natural

966
00:30:11,340 --> 00:30:15,860
gas or, you know, forestry or
mining or whatever it is.

967
00:30:16,100 --> 00:30:19,200
You know, the auto industry, the
steel industry, you need foreign

968
00:30:19,200 --> 00:30:19,400
investment.

969
00:30:19,400 --> 00:30:21,740
You need money to come to our

970
00:30:21,740 --> 00:30:21,880
country.

971
00:30:21,880 --> 00:30:23,000
You know, our leaders go on trade

972
00:30:23,000 --> 00:30:25,760
missions to other countries to
encourage them to invest in this

973
00:30:25,760 --> 00:30:26,040
country.

974
00:30:26,260 --> 00:30:27,680
Yeah, but don't buy a house.

975
00:30:27,680 --> 00:30:30,160
Don't invest in the multi -billion
dollar housing industry because

976
00:30:30,160 --> 00:30:31,280
somehow that's wrong.

977
00:30:31,280 --> 00:30:32,700
because somehow that's wrong.

978
00:30:32,700 --> 00:30:34,400
I agree with you.

979
00:30:34,400 --> 00:30:36,180
I honestly, I've tried to figure

980
00:30:36,180 --> 00:30:38,920
it out and it just makes no sense
at all.

981
00:30:38,920 --> 00:30:40,160
And then politicians will say,
well, it's popular.

982
00:30:40,160 --> 00:30:42,180
You know, the public is supportive
of it.

983
00:30:42,180 --> 00:30:44,640
Well, is that how we make policy
in this country, in this world?

984
00:30:44,640 --> 00:30:46,840
If we always went with what's
popular, maybe we wouldn't be

985
00:30:46,840 --> 00:30:49,940
making decisions for the
minorities or the least

986
00:30:49,940 --> 00:30:50,040
advantaged.

987
00:30:50,040 --> 00:30:50,940
Policy should not necessarily be

988
00:30:50,940 --> 00:30:51,480
about what's popular.

989
00:30:51,480 --> 00:30:53,320
And if it's the right thing to do,

990
00:30:53,440 --> 00:30:56,000
and if that's what we need, we
need foreign capital in our

991
00:30:56,000 --> 00:30:56,160
market.

992
00:30:56,160 --> 00:30:59,180
I talked about all these policies

993
00:30:59,180 --> 00:30:59,880
and regulations.

994
00:30:59,880 --> 00:31:00,680
Access to capital is the biggest

995
00:31:00,680 --> 00:31:02,360
stumbling block because if you
can't get your financing, you

996
00:31:02,360 --> 00:31:03,440
can't get your project.

997
00:31:03,440 --> 00:31:04,280
And you've got to sell a

998
00:31:04,280 --> 00:31:05,560
multifamily building within 12 to
18 months.

999
00:31:05,560 --> 00:31:07,420
And if it's a large, tall
building, it's almost impossible

1000
00:31:07,420 --> 00:31:09,580
right now to sell 70 % or 80 % of
it.

1001
00:31:09,580 --> 00:31:11,640
And you have no other way to
access capital.

1002
00:31:11,640 --> 00:31:13,860
Like it seems like in the last few
years, everything's been purpose

1003
00:31:13,860 --> 00:31:14,680
-built rentals, MI Select.

1004
00:31:14,680 --> 00:31:15,920
that type of funding.

1005
00:31:15,920 --> 00:31:16,860
I guess two questions.

1006
00:31:16,860 --> 00:31:18,000
Do you feel that that's maybe been

1007
00:31:18,000 --> 00:31:21,310
a little oversaturated and they've
really just focused on that?

1008
00:31:21,530 --> 00:31:24,330
Or is there asset class that they
are not focusing on that they

1009
00:31:24,330 --> 00:31:25,150
should be?
Stratified condo properties,

1010
00:31:25,530 --> 00:31:26,090
single family homes.

1011
00:31:26,090 --> 00:31:27,910
There's no creative type funding

1012
00:31:27,910 --> 00:31:30,110
by the government to support
developers on those asset classes.

1013
00:31:30,250 --> 00:31:31,190
Should there be?
And is there anything coming down

1014
00:31:31,190 --> 00:31:33,430
the pipe on that?
Yeah, I don't know if it's

1015
00:31:33,590 --> 00:31:35,810
oversaturated, the rental market,
but, you know, took advantage of

1016
00:31:35,810 --> 00:31:36,070
it.

1017
00:31:36,070 --> 00:31:35,070
We hadn't built rental in this

1018
00:31:35,070 --> 00:31:36,810
country or in this province for
decades properly.

1019
00:31:36,870 --> 00:31:38,350
But, you know, now the MLA select
program has changed again.

1020
00:31:38,350 --> 00:31:41,150
And now the charges for that
insurance have gone way, way up.

1021
00:31:41,150 --> 00:31:43,030
Something that program is done.

1022
00:31:43,030 --> 00:31:44,710
We've said that to the government,

1023
00:31:44,710 --> 00:31:46,300
you know, even if they're
investors.

1024
00:31:46,300 --> 00:31:48,600
So, you know, again, the investor
is bad to buy a condo and sort of

1025
00:31:48,600 --> 00:31:49,260
profit from it.

1026
00:31:49,260 --> 00:31:50,060
was seen as bad.

1027
00:31:50,060 --> 00:31:54,340
Whereas you buy a condo and you
put it into the rental pool and

1028
00:31:54,340 --> 00:31:55,880
you leave in the rental pool for
20 years.

1029
00:31:55,880 --> 00:31:59,680
Yes, you made some money on it,
but I don't see why we demonize

1030
00:31:59,680 --> 00:31:59,860
that.

1031
00:31:59,860 --> 00:32:02,920
So we said, okay, if you really

1032
00:32:02,920 --> 00:32:05,940
don't want people flipping, what
if investors could purchase?

1033
00:32:05,940 --> 00:32:10,340
And they would get the GST rebate
as long as it stayed in the rental

1034
00:32:10,420 --> 00:32:12,120
pool for a certain number of
years.

1035
00:32:12,300 --> 00:32:15,840
So we did get the GST rebate on
purpose -built rental, but only if

1036
00:32:15,840 --> 00:32:18,400
you're building it for a certain
number of units.

1037
00:32:18,400 --> 00:32:22,460
But if you bought a couple of
units and you're renting them out

1038
00:32:22,460 --> 00:32:25,260
and there's a small mom and pop
operation, what's wrong with that?

1039
00:32:25,260 --> 00:32:28,480
But somehow we don't want that,
but nor do we want the big REITs

1040
00:32:28,480 --> 00:32:29,440
or the big foreign investments.

1041
00:32:29,440 --> 00:32:30,440
So where's the money coming from?

1042
00:32:30,440 --> 00:32:32,780
So yes, there are ways we believe
that you can.

1043
00:32:32,780 --> 00:32:34,000
incentivize all forms of housing.

1044
00:32:34,400 --> 00:32:36,180
A lot of it is getting the

1045
00:32:36,180 --> 00:32:38,000
policies, the layering and
layering of policies out of the

1046
00:32:38,000 --> 00:32:38,300
way.

1047
00:32:38,300 --> 00:32:39,460
You don't have so many of these

1048
00:32:39,460 --> 00:32:39,660
requirements.

1049
00:32:39,660 --> 00:32:41,400
You've got so many of these

1050
00:32:41,400 --> 00:32:43,800
requirements, like I said, whether
it's green building initiatives,

1051
00:32:43,800 --> 00:32:47,080
EV charging, when we don't even
have access to the power.

1052
00:32:47,240 --> 00:32:47,780
we did Yeah.

1053
00:32:47,780 --> 00:32:49,700
I mean, that's been a topic in

1054
00:32:49,700 --> 00:32:53,570
Kelowna is like, are we going to
have enough power in the next

1055
00:32:53,570 --> 00:32:55,830
couple of years to fulfill any of
these projects?

1056
00:32:55,830 --> 00:32:57,690
So yeah, EV charging may not be
necessary.

1057
00:32:57,690 --> 00:32:58,670
may not be necessary.

1058
00:32:58,670 --> 00:32:59,950
And then soil relocation.

1059
00:32:59,950 --> 00:33:01,390
These things to the average
person.

1060
00:33:01,390 --> 00:33:04,410
They just want a nice home with a
nice fixtures and things.

1061
00:33:04,410 --> 00:33:08,230
But these are the things that we
have to deal with is now we have

1062
00:33:08,230 --> 00:33:10,370
nowhere to dump soil because on
the agricultural land, it doesn't

1063
00:33:10,370 --> 00:33:12,790
meet the requirements, even though
it's clean soil or we don't have

1064
00:33:12,790 --> 00:33:13,290
enough dumping sites.

1065
00:33:13,290 --> 00:33:15,970
So now you're having to truck

1066
00:33:15,970 --> 00:33:20,010
stuff for 30, 40 kilometers or
there's nowhere to dump it.

1067
00:33:20,010 --> 00:33:21,890
And how is that stating the
environment?

1068
00:33:21,890 --> 00:33:23,850
And so we have had a meeting.

1069
00:33:23,850 --> 00:33:25,730
We did just have a meeting with

1070
00:33:25,730 --> 00:33:26,890
the minister last week.

1071
00:33:26,890 --> 00:33:27,150
It's OK.

1072
00:33:27,150 --> 00:33:28,410
We see the problem.

1073
00:33:28,410 --> 00:33:31,050
And, you know, we need to create

1074
00:33:31,050 --> 00:33:35,950
more dumping sites on Crown land
or in other areas because that

1075
00:33:35,950 --> 00:33:36,930
adds costs.

1076
00:33:36,930 --> 00:33:39,730
You know, you've got to hire the

1077
00:33:39,890 --> 00:33:39,990
truck.

1078
00:33:39,990 --> 00:33:41,130
The truck is driving for literally

1079
00:33:41,130 --> 00:33:41,310
hours.

1080
00:33:41,310 --> 00:33:42,270
And then you've got to dump it

1081
00:33:42,270 --> 00:33:43,990
somewhere else in the Okanagan and
someplace.

1082
00:33:44,030 --> 00:33:45,070
They don't have any dumping sites.

1083
00:33:45,130 --> 00:33:46,170
I mean, on the island, they're

1084
00:33:46,170 --> 00:33:49,710
having to truck it up and over the
Malahat, you know, for a couple of

1085
00:33:49,710 --> 00:33:49,930
hours.

1086
00:33:49,930 --> 00:33:51,650
So those are sort of things like

1087
00:33:51,650 --> 00:33:53,550
it sounds like a really good idea.

1088
00:33:53,650 --> 00:33:53,990
Oh, yes.

1089
00:33:54,050 --> 00:33:56,230
Well, that soil doesn't match that
soil or this.

1090
00:33:56,230 --> 00:33:58,690
So you can only dump soil on the
agricultural land if it's.

1091
00:33:58,690 --> 00:34:01,130
soil fit for food production, even
though the soil is actually

1092
00:34:01,130 --> 00:34:04,650
probably completely fine, but it
might be just 0 .01 % more

1093
00:34:04,650 --> 00:34:05,790
salinity that or something like
that.

1094
00:34:05,790 --> 00:34:06,390
There isn't that subjectivity.

1095
00:34:06,390 --> 00:34:07,210
Salinity levels, you know, the

1096
00:34:07,210 --> 00:34:07,670
soil can't go there.

1097
00:34:07,670 --> 00:34:08,969
Well, it just came from here.

1098
00:34:08,969 --> 00:34:12,090
Why can't I put it over there?
Well, you know, so those are the

1099
00:34:12,310 --> 00:34:15,570
kind of rules that you're up
against that you say, who came up

1100
00:34:15,570 --> 00:34:17,880
with these?
You know, good intention, but not

1101
00:34:17,880 --> 00:34:19,480
looking at the cost.

1102
00:34:19,480 --> 00:34:20,860
And when there was, as I say, room

1103
00:34:20,860 --> 00:34:23,639
in the system, when there was
enough profit, I suppose, in the

1104
00:34:23,639 --> 00:34:25,320
system that could pay for that
stuff.

1105
00:34:25,320 --> 00:34:27,000
But those days are gone.

1106
00:34:27,000 --> 00:34:27,260
Yeah.

1107
00:34:27,260 --> 00:34:29,060
At the federal level and
provincial, you know, in the last

1108
00:34:29,060 --> 00:34:31,120
year, we've had new leadership,
not new parties, but new

1109
00:34:31,120 --> 00:34:31,360
leadership.

1110
00:34:31,360 --> 00:34:32,679
Do you feel that that leadership

1111
00:34:32,679 --> 00:34:36,060
in their campaigns, like the
promises they've made are now

1112
00:34:36,060 --> 00:34:37,139
following through with those
promises?

1113
00:34:37,139 --> 00:34:38,639
Like, is it still going in the
direction that?

1114
00:34:38,639 --> 00:34:40,420
people voted for?
At the federal level, it's too

1115
00:34:40,420 --> 00:34:41,739
early to tell.

1116
00:34:41,739 --> 00:34:43,520
But the wheels and the machines of

1117
00:34:43,520 --> 00:34:46,159
government are going in that
direction.

1118
00:34:46,159 --> 00:34:48,380
They're not huge changes, right?
The GFT relaxation talked about,

1119
00:34:48,380 --> 00:34:51,400
you know, and then the
infrastructure sort of paying for

1120
00:34:51,400 --> 00:34:53,139
half of the DCC, half the
development cost charge.

1121
00:34:53,139 --> 00:34:56,840
But the amount of money that was
earmarked in the federal budget

1122
00:34:56,840 --> 00:34:59,500
wouldn't pay for even half of what
that is.

1123
00:34:59,660 --> 00:34:23,460
So at the provincial level, there
was a lot of really substantial

1124
00:35:01,620 --> 00:35:03,340
and good work that was done on
changes in legislation.

1125
00:35:03,340 --> 00:35:06,360
But then at the same time, you
know, interest rates went up.

1126
00:35:06,360 --> 00:35:10,060
And the cost of housing delivery
went up, as well as the new

1127
00:35:10,200 --> 00:35:13,070
building code that came in, which
is adding 10 to 15 percent.

1128
00:35:13,070 --> 00:35:15,610
Building step code three,
increasing the DCCs at all levels.

1129
00:35:15,710 --> 00:35:16,610
There was some good work done.

1130
00:35:16,610 --> 00:35:18,370
But now in order to have that

1131
00:35:18,370 --> 00:35:20,310
legislation work, we need to take
a lot of the costs out of the

1132
00:35:20,310 --> 00:35:20,390
system.

1133
00:35:20,390 --> 00:35:21,330
Provincial government is saying,

1134
00:35:21,330 --> 00:35:22,590
oh, we didn't realize.

1135
00:35:22,590 --> 00:35:25,570
I guess they were told that people

1136
00:35:25,570 --> 00:35:26,870
were still making money.

1137
00:35:26,870 --> 00:35:28,330
So how could it possibly be a

1138
00:35:28,510 --> 00:35:29,810
problem?
And I said to once, the deputy

1139
00:35:29,810 --> 00:35:31,390
minister says, it's just math.

1140
00:35:31,390 --> 00:35:31,930
It's just money.

1141
00:35:31,930 --> 00:35:35,210
And I said, you know, if it costs
more to build than someone can

1142
00:35:35,210 --> 00:35:36,010
afford, it doesn't get built.

1143
00:35:36,010 --> 00:35:37,150
And they went, OK, OK, you know,

1144
00:35:37,150 --> 00:35:39,850
so people complicate housing.

1145
00:35:39,950 --> 00:35:41,310
You know, it's an answer to

1146
00:35:41,310 --> 00:35:41,330
homelessness.

1147
00:35:41,430 --> 00:35:42,590
It's the answer to adaptability.

1148
00:35:42,590 --> 00:35:44,930
It's the answer to the state and
the environment.

1149
00:35:44,930 --> 00:35:48,090
Now, we're just trying to get
housing built.

1150
00:35:48,150 --> 00:35:50,430
Let's make housing a priority and
ensure that it is safe, you know,

1151
00:35:50,430 --> 00:35:51,370
sustainable, accessible.

1152
00:35:51,370 --> 00:35:51,990
But if we're bringing the policies

1153
00:35:51,990 --> 00:35:54,230
to achieve those things and it
costs more to get it built.

1154
00:35:54,230 --> 00:35:55,350
then we need to look at that.

1155
00:35:55,490 --> 00:35:56,350
Then we need to rethink that.

1156
00:35:56,350 --> 00:35:58,430
So to answer your question, I
think that there is a recognition

1157
00:35:58,690 --> 00:36:00,790
and I just have to be hopeful, but
it's a lot of work.

1158
00:36:00,790 --> 00:36:03,550
I mean, I don't know if I've never
worked so hard or I've never

1159
00:36:03,690 --> 00:36:05,750
worked in such a frustrating,
difficult environment in my

1160
00:36:05,750 --> 00:36:06,450
career.

1161
00:36:06,450 --> 00:36:07,190
It's hard.

1162
00:36:07,190 --> 00:36:08,190
It's really hard.

1163
00:36:08,190 --> 00:36:10,370
And you know what needs to be done

1164
00:36:10,370 --> 00:36:13,650
and that you know it's going to
take time, you know, stuff to see

1165
00:36:13,650 --> 00:36:14,530
people lose money.

1166
00:36:14,530 --> 00:36:15,510
If you could just make...

1167
00:36:15,510 --> 00:36:18,410
One policy change, one rule,
anything like a change that would

1168
00:36:18,410 --> 00:36:19,290
be implemented tomorrow, whether
that's removing current

1169
00:36:19,290 --> 00:36:20,590
legislation policy or, you know,
implementing something, what do

1170
00:36:20,850 --> 00:36:22,230
you think would be the biggest
needle mover?

1171
00:36:22,230 --> 00:36:24,150
Well, in the lower mainland
anyway, I think it would be

1172
00:36:24,290 --> 00:36:26,670
removing the requirement for 20 %
inclusionary zoning, at least

1173
00:36:26,950 --> 00:36:28,490
until things turn around.

1174
00:36:28,490 --> 00:36:30,910
And I think that other big ones,

1175
00:36:30,910 --> 00:36:32,310
certainly in the Okanagan,
Victoria, the costs are associated

1176
00:36:32,310 --> 00:36:33,530
with the new building code.

1177
00:36:33,690 --> 00:36:34,850
There has to be a financial

1178
00:36:34,850 --> 00:36:35,010
offset.

1179
00:36:35,010 --> 00:36:37,570
You can add 10 % to the cost of

1180
00:36:37,570 --> 00:36:40,070
building with government
requirements without compensation

1181
00:36:40,470 --> 00:36:40,610
or offset.

1182
00:36:40,670 --> 00:36:41,610
Well, honestly, this has been

1183
00:36:41,610 --> 00:36:41,870
awesome.

1184
00:36:41,870 --> 00:36:43,490
Yeah, I've really been looking

1185
00:36:43,710 --> 00:36:44,970
forward to this conversation.

1186
00:36:44,970 --> 00:36:46,790
And yeah, you did not disappoint.

1187
00:36:46,790 --> 00:36:48,970
So thank you so much for coming
on.

1188
00:36:48,970 --> 00:36:53,170
Hopefully we'll see you next time
you're up in Kelowna at one of the

1189
00:36:53,170 --> 00:36:53,250
meetings.

1190
00:36:53,250 --> 00:36:54,760
of the meetings.

1191
00:36:54,760 --> 00:36:55,060
Definitely.

1192
00:36:55,060 --> 00:36:55,940
We appreciate this.

1193
00:36:55,940 --> 00:36:58,900
And it was really a pleasure to
talk with you too.