Are Vancouver’s high housing prices and rents ‘a policy decision’?

“The kind-of-good news is that this is a policy choice,” Los Angeles-based urban planning expert Nolan Gray told a crowd in Vancouver Friday. “I wouldn’t be working on this issue if I didn’t think it was fixable.”

Austin, Texas, is a booming tech industry hub often fondly name-checked by Vancouver’s mayor as a fun, vibrant city to emulate.

The Greater Austin area has also, in recent years, seen a phenomenon that seems almost unthinkable to Vancouverites: while the city is growing, rents have been falling.

Starting around 2020, Austin saw rapid population growth, quickly rising rents, and‚ with its liberal land-use policies and fast building permitting processes — a construction boom, Los Angeles-based urban planning expert Nolan Gray told a crowd of local real estate types Friday in Vancouver.

“Because they allowed the flexibility, and they allowed housing markets to respond to demand. … Now, what do you know? Now the crisis has flipped, now the crisis is rents are falling too much. I can tell you, we would love to have a crisis like that in L.A.”

While Metro Vancouver has been adding more housing in recent years than many U.S. cities, Gray said, it’s a far cry from Austin’s recent apartment boom, which added almost twice as many homes on a per-capita basis.

And as bad as the housing crisis is in many U.S. cities, Gray said Friday, the Canadian situation is even worse.

“Whatever problems we have down there, boy, it’s an incredible situation up here,” Gray told a crowd including executives of major Vancouver real estate companies, urban planners, YIMBY housing activists, and City Hall political staff. “It’s not just prices increasing. We expect prices to increase if incomes are increasing. Yet what we’ve seen in certain parts of the U.S. — although not as a whole — is a decoupling of incomes from home prices. In the U.S., this is isolated to what we call our ‘superstar cities’ — the San Francisco Bay Area, Greater L.A., Boston, New York City. In Canada, this is reflected nation-wide.”

“The kind-of-good news is that this is a policy choice,” Gray said. “I wouldn’t be working on this issue if I didn’t think it was fixable.”

In short, Gray argues that governments should abolish rules like those setting minimum parking requirements or prohibiting apartment buildings from certain neighbourhoods, and let the market build, build, and build more until homes are more affordable.

In his introductory remarks, Sullivan mentioned that when he was elected mayor in 2005, he thought he needed to tackle high housing prices.

“I failed spectacularly,” Sullivan said, to laughs from the crowd. “So I thought: ‘Why not try this one more time? I’ll take another look at it from outside City Hall instead of inside.’ So this is a part of all of that.”

Speaking after the event, Sullivan reflected that his own push to make denser communities through zoning reform — a program his office termed “EcoDensity” — was a major reason his own party, the Non-Partisan Association, pushed him out and refused to let him run for re-election, replacing the incumbent mayor with then-NPA councillor Peter Ladner as its mayoral candidate.

While the NPA’s fortunes have dwindled since Sullivan’s term in office, Vancouver voters rewarded the party’s centre-right successor, ABC, with a decisive majority in the 2022 election on a platform that included dramatically boosting housing.

Meanwhile, major zoning reforms are underway around the province, with the B.C. NDP implementing sweeping zoning reforms mandating housing density in municipalities, drawing the ire of some local governments.

Speaking after Friday’s event, Gray said he thinks that type of action from senior governments — similar to what has happened in some U.S. states — is “unavoidable” and will only become more common in the future.

“You’re not going to solve the housing crisis unless every local jurisdiction is doing its fair share to build housing,” Gray said. “I don’t see any other way around it. Of course, the ideal is that every local government sees the light and reforms on their own. But we can’t wait for that.”