As July came to a close, there were “duelling letters” regarding real estate development in B.C., and a response from the premier.
A letter co-signed by a number of prominent developers asked the government to reconsider its restrictions on foreign investment in real estate, citing the urgent need to build additional housing units that were constrained by the challenges of raising enough capital through the presale process.
Ideologically, however, restriction of foreign investment has opposing views.
In another letter, co-signed by 27 “urbanists, urban planners, architects, developers and UBC/SFU academics,” the authors recommended an approach to the housing affordability crisis that centres on non-market housing.
Premier Eby responded to the letter from developers by stating: “That model is dead,” and “we are not going back” when it comes to expanded access of foreign investment capital.
At this point, he hasn’t responded to the letter from the 27 urbanists, urban planners, et al. Which raises an interesting question for the premier. What then is the new model? If there actually is one? If we’re “not going back,” then what’s the path forward?
In March 2025, the premier actually acknowledged that investors have a role to play in meeting Canada’s housing supply targets. But now he seems to be backtracking on this position.
In order to meet the aggressive new housing targets identified by Prime Minister Carney and the federal government, in addition to groups such as the CMHC, we will need upwards of $200 billion of new capital just within B.C.
And that’s a conservative estimate.
RBC estimates the figure nationally at $2 trillion. While Canada is considered a wealthy country, it’s simply not realistic that domestic investors have that much money earmarked for new real estate development.
The stagnation we are now witnessing in the development industry is entirely counterproductive given the need to continue building new housing supply.
The ‘Australia Model’, where foreign money is permitted to fund new real estate projects (that is presales), but prevented from purchasing existing resale homes, seems to be a pragmatic, workable approach to controlling foreign investment. Translation: It’s a practical, real-world option that should be given very careful consideration.
Regarding the urbanists’ letter, while few would argue against senior governments increasing investment in non-market housing, it isn’t the panacea that these writers believe it to be.
According to the National Housing Council, about 3 1/2 per cent of Canada’s housing stock is considered non-market. The council recommends doubling that figure to seven per cent, but that should be independent of efforts to improve the conditions for expansion of market housing. Since most households function on the “market” side of the housing equation, ignoring the production of new market housing is an illogical approach to solving our affordability crisis.
While all three levels of government have (or are planning) to implement measures to assist the production of housing, such as simplified zoning, streamlined permitting/approval processes, boosting the production of prefabricated housing and other policies, there remains a fundamental economic conundrum. The “model” that worked to produce new housing in a rising market has broken down in a stagnant/falling market.
What is the way forward? How can we get to a new model of market housing development that allows us to reach a goal of “more housing options, for more people, in more places”?
One thing I know for sure: We’re not going to get there by retreating into silos and yelling at each other through open letters and media articles (and, yes, I see the irony here). We need a formalized process to bring key stakeholders together to discuss the viability of different policy options, their pros and cons, their potential unforeseen consequences, the need to continuously monitor and improve them, and how to do it by working together.
Perhaps there is a way forward.
This is why the BCREA has, for many years now, been advocating for a permanent housing policy roundtable, where these exact discussions can take place.
Trevor Koot is CEO of the B.C. Real Estate Association.